Small and Medium BPO Companies Urge Gov't for More Tax Incentives

Small and Medium Call Center companies urged the government for additional tax incentives to help them compete with the large companies amid the talent war and higher power rates. Among the challenges that small call center companies cited were talent recruitment, high attrition rate, government incentives and rising cost of power and utilities.

New facets of the business process outsourcing sectors are still emerging, such as small to medium sized call centers. Small and medium scale call centers (SMCCs) are flourishing and they can prove to be as strong support sector as the big operators we are seeing today. SMCCs are those operated with a capacity of 200 seats or less, and preferably at least 10 seats to ensure viability. The Commission on Information and Communication Technology (CICT), refer to these as Smites or small-and-medium-scale information technology enterprises. These call centers are becoming are becoming a strong presence in the Philippine call center industry for the up coming years. In fact, they are dispersed in the regions unlike the big call centers, and the average SMCC has 10 seats.

There are over 300 small and medium enterprises call center firms in the BPO industry. Small companies have 1,000 and below employees, medium has 1,000 to 5,000 and large with 5,000 and above. Beaver Lopez Jr., chief executive officer (CEO) of Pacific Hub, said that the incentives to SME should be different from that of the large companies to help them to cope with the challenges. Lopez said the government gives tax and holiday incentives in the first five years of operations whether large or small companies.

Edith Reilly, president of TrecPacific Corp., said the government incentives for the SMEs are not enough as the cost of doing business in the Philippines has been going up. She said the lower foreign exchange rate has also impacted the small companies because when they started, the forex was at P50 but is now down to P 43. Majority of their clients are SMEs in the United States. Aside from the incentives, Reilly also said that the government also needs to step up the quality of education in the Philippines as the English speaking skills of the graduates in the past years have been deteriorating.

CCAP’s Expo Takes on Global Dimension

The Contact Center of the Philippines (CCAP), will organize the International Contact Center Conference & Expo, which sets its sights on the global horizon by creating an avenue that will share best practices and case studies from other countries as well as the Philippines. This is the sixth conference and expo to be organized by CCAP. This year’s event promises to be larger and more exciting as it draws more delegates from all over the world. With guest speakers from different continents to share their insights and experiences from a more global perspective. The International Contact Center Conference & Expo will be held on Sept. 28-29 at the SMX Convention Center in Pasay City.

The International Contact Center Conference & Expo will also mix speakers from diverse backgrounds and various sectors — operations, marketing, human resource management, training, academe, technology, research, real estate, and consultancy — ensuring a rich learning experience. The plenary sessions will highlight special panel discussions, including a Global CEO Forum, which will discuss issues in the global outsourcing market; an Analyst Panel Discussion, which will share international trends; and an SME Panel Discussion, which will tackle how smaller players can build homegrown global BPO brands.

The two-day event also opens up possibilities for international networking for operators and vendors. The exposition is an avenue by which exhibitors and sponsors can target international, or at least regional, markets. There is also a two-day job fair with dozens of call centers looking for new hires. They will accept and process job applications and conduct on-the-spot interviews. In addition, call centers and training companies will conduct free workshops and career orientation seminars for job seekers. It is the official job fair for the call center industry, represented by the some of the biggest call centers in the country, including the 65 CCAP member call centers. This conference is expected to raise the industry to a whole new level, and showcase Philippine depth and range in contact center capabilities. At the same time, building the country as the prime destination for global conferences and promote the Philippines as a world-class business-leisure destination. It will give the international market a compelling reason to come here to learn. And being the number one player in outsourced contact center services with a solid track record and a rich knowledge base is a very good reason.

The R5 (Rant, Rave, Rant, Rant, Rave) Blog: What counts as Ethical SEO?

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Benefits of Home Sourcing

Home sourcing, in basic terms, it is outsourcing to people's homes. Many businesses - chiefly, call centers - are jumping on the home sourcing bandwagon to cut costs and reap many other benefits. Home sourcing is a win-win prospect, as these positions allow workers to obtain stable employment while enjoying the advantages of working at home. As stated, both employers and employees can benefit from home sourcing positions. Employers are well aware that many customers and clients prefer to speak with someone whom they can easily understand and vice versa. Outsourcing overseas can result in language and dialect barriers that leave callers frustrated and unhappy. Home sourcing is a solution for this problem that pleases customers while keeping overhead costs lower for the companies they are calling. Employers may even be able to benefit from special tax credits by home sourcing jobs. Many home sourcing employers hire representatives on a contract basis, which cuts the costs of benefits such as health insurance and paid time off.

Since employees enjoy the plusses of telecommuting, such as saving money on gas and no stressful commute, they can pay a lower wage than they would to full-time, on-site staff. Don't write home sourcing jobs off as not worth your time, though. These jobs are still subject to minimum wage laws and most pay substantially more than that. In addition, read Benefits of Working from Home and Environmental and Cost Benefits of Telecommuting to Work to learn more about how you might benefit from a home sourcing position.

Outsourcing has become more attractive in recent years due to improved technology and wage arbitrage opportunities. Expanded broadband access, improved call-routing networks, and cheaper computer technology have allowed outsourcing to accelerate. Wage arbitrage opportunities, buying labor where it is relatively inexpensive, have arisen in industrialized countries with significant labor costs. An American computer programmer is paid between $75-$100 an hour while a similarly skilled Indian programmer is paid only $20 an hour. The same developments that have encouraged outsourcing have also benefited the growth of home sourcing. Improvements in technology can just as easily move work to a call center in Bangalore as to an employee’s home in Salt Lake City. Similarly, the sorts of wage differences that allow labor arbitrage between countries exist within the U.S. as well. U.S. computer programmers in metro areas earn between $75-$100 an hour while similarly skilled programmers in rural areas earn only $35-$40 an hour.

Cost Cutting in the Outsourcing Business

Companies nowadays keep on searching for possible ways to cut costs. Amidst the economic turmoil, outsourcing business became popular and viable to help businesses continue their services while decreasing operational costs. As a result, cost centers, like IT departments, are prime targets for outsourcing and off-shore maintenance. The typical business script is that as the IT organization moves into maintenance mode that cost center with high overhead becomes a prime target for reducing costs. Companies have reduced their spend on IT services and business transformation by almost one fifth by turning to outsourcers, according to a survey.

Michael DeSalles, Frost & Sullivan Research Analyst, said While the U.K. outsourcing market is fully grown and nearly reached dispersion and there are important opportunities in other European countries. Central and Eastern Netherlands proposed new outsourcing contracts that deal with financial services, communications, and information technology. The cost differential in BPO operations is not adequate. The organization must certify the availability of the resources which includes infrastructure and pool of individuals. The service levels can be maintained while deducting the costs. Last year Europe became the world's highest spender on outsourcing, with companies based in Europe spending more on IT outsourcing than those based in any other region of the world. In 2010 UK companies are expected to increase the amount they spend on outsourcing back-office functions, such as HR and finance.

Call centers desire to accomplish their work efficiently in low cost. If a company wants to compete, it must deal with business operations that will be beneficial and less costly. Inbound and outbound services in call centers maintain all types of tensions. Personnel with expertise are hired to have the work done as required by their clients. Customers will be grateful if they are attended with full respect and attention. BPO services are important to make better infrastructure provide good service to the customers. Call Center activities are tedious, cumbersome, time-consuming, extra-strenuous, and demanding. Extra budget is needed in other BPO activities. The workforce handling is another task which involves setting up of individual customer care unit. Outsourcing call center activities will benefit the Company's performance.

Despite The Crisis in Europe Outsourcing Work Expected to Continue

Despite a debt crisis in Europe, are expected to continue and, in some cases, even increase their outsourcing and offshoring work to low-cost countries like India and Philippines. Though Europe is still fragile, we are certainly seeing an uptick in outsourcing, as well as offshoring from European clients. Deals are getting shorter and smaller in duration, but it certainly is increasing. To give you an idea of the 800 inquiries that we received last year from European clients, about 90 per cent asked us about offshoring, explains Gilbert Van Der Heiden, Gartners research director for information technology (IT) sourcing.

Earlier European customers started with staff augmentation but as they see the cost advantage, they are looking beyond that and want to partner at a strategic level. Other than the economic downturn and need to cut cost, European customers use a large number of contractors. Due to the immediate cost savings initiatives, they are looking at replacing expensive contractors with offshoring. IT firms also agree that Europe is much more positive to offshoring than it was before the global meltdown hit.

“The Europe crisis will not have much of an impact on Philippine IT service providers. The impact will be on valuations due to the currency movement, but this will not impact the deal flow. Similarly in the UK, the incumbent government is under huge pressure to reduce cost,” says Peter Bendor Samuel, Chief Executive Officer, Everest Group. Much more, Philippine outsourcers have been urged to turn their attention to European customers to expand their markets. European Chamber of Commerce and Industry in the Philippines executive VP Henry Schumacher said the Philippines is still unable to fully maximise the outsourcing market, which is currently being enjoyed by India. Philippines has a huge potential to even grab a bigger share. Since Europe is also aggressively looking at opportunities from emerging countries in the east, Philippines set to explore Europe since it is also the largest business process outsourcing market.

Vikram Gulati, Director of Quantum Step remarks that Europe has some serious challenges. The population is aging, and they are running out of skills. They will have to look at outsourcing and offshoring. Most of the large players have benefited from this. It is for the others, the medium-sized players, to adopt this.

Philippines Urged to Tap Europe Outsourcing Market

Philippine outsourcing companies have been urged to turn their attention to European customers to expand their markets. Now that the country is fast capitalizing on being among the world’s destinations for global outsourcing and off-shoring business, industry stakeholders here are encouraged to continue to taking advantage of the vast European market.

European Chamber of Commerce and Industry in the Philippines executive VP Henry Schumacher said the Philippines is still unable to fully maximize the outsourcing market, which is currently being enjoyed by India. "India is doing well in marketing itself as a growth location for European investors. But the Philippines has a huge potential to even grab a bigger share," he said. "Since Europe is also aggressively looking at opportunities from emerging countries in the east, now is the time for the entire Philippines to explore Europe since it is also the largest business process outsourcing market," Schumacher said. While several European companies have already come to invest in the Philippines, the lack of knowledge in understanding the European culture requires need for waging a more aggressive campaign when penetrating the foreign market. The European culture is not hard to grasp and the European Chamber of Commerce of the Philippines (ECCP) is willing to assist stakeholders here in that aspect, the association can do initial training for employees to businesses like call center.

Schumacher advised that more visibility in the market should be emphasize, including the need for a European or someone with influence speaking for the Philippines and the business environment in the country. Branding, he stressed, is also necessary when capitalizing on the highly elusive European market. The brand should professionalize Filipinos. We believe that everybody in the world has in one way or another been touched by a Filipino. The Filipinos’ individuality is important to market the Philippines to Europe, we just have to focus on the Filipinos’ capabilities.

The ECCP is currently conducting talks with the Business Process Association of the Philippines (BPAP) to pioneer a committee called “Team Europe” to spearhead an aggressive marketing campaign for the country’s O&O industry. The team will also involve other institutions like the Commission on Information and Communication Technology (CICT), CITEM and a number of individual companies.

Outsourcing Packaging of Spices!

Often people associate the idea of outsourcing only with the large scale industries. However even the small scale companies can benefit in their own way by outsourcing the operation of a specific department.

The small companies which process the spices starting from the plucking of spices and then their grinding etc can actually benefit a lot by outsourcing the packaging of their spices. While these companies are known for providing some of the best quality spices they tend to miss out on getting their due as far as sales are concerned because somehow their packaging standards are lower than that of the high end companies and people tend to purchase more of the products which are well packed. By outsourcing their packaging to a company which can provide them with high quality packaging, the small scale spice companies can actually benefit a lot in terms of attracting customers.

Moreover, since all the employees of the small scale spice company would be focused on their core job of selecting the spices and getting them powdered, the company would be able to further improvise the standard of the spices they retail. By outsourcing their packaging department they would be able to avoid the requirements of having a packaging department. This way they would not have to hire employees who would be solely dedicated to the packing of spices. The company would have the option of either reducing the number of employees or they could even look forward to increasing their production by utilizing the services of those employees in the production section.

While the concept of outsourcing had been introduced by large scale companies, these days even the small scale companies are benefiting by outsourcing specific segments of their company to other companies which provide specialized services in that specific segment.

Advantages of Outsourcing the Packaging of Goods by Small Scale Industries

Most of the small scale companies which manufacture products such as candles and incense sticks etc have to set up an extra department in order to handle the packaging of the candles which are manufactured by their company. While this helps the company in releasing a finished product to the market, the fact is that they can gain a lot by outsourcing their packaging department needs.

Once a candle making company decides to outsource the packaging segment of their company, they can concentrate on their core competency of candle making and can utilize their resources in increasing their productivity. The fact that they do not need to hire extra employees would save them a lot of money annually. Moreover packaging requires the presence of trained professionals who are trained in the art of packaging. Once a company decides to outsource its packaging needs the company does not have to invest any time or money on hiring and training employees to be a part of the packaging team.

The fact that the company decides to outsource their packaging needs to another company helps the main company in avoiding the necessity of investing in machinery related to packaging. Moreover when a company outsources the packing of its candles they increase the productivity by devising best practices that help all the departments in maximizing their efficiency levels.

After outsourcing the packaging segment of the company, the management can focus on picking bigger orders of manufacturing candles because they would have the manpower and space to increase their production. So while a different company is handling the packaging for them they can concentrate on increasing the production in their company. Small scale companies which have been operating for a long time need a business analysis done in order to see what their company can do in order to increase their productivity. Outsourcing will definitely be an option!

Outsourcing and its Benefits for Telecom Industry

Outsourcing is the new key in the present world to expand your business. According to the latest trends, most of the businesses have now started depending on the outsourcing phenomenon in order to succeed in their business.

Amongst all the businesses profiting from the services provided by outsourcing, telecom industry is one. According to estimates, almost 75% of the telecom business companies have already taken to outsourcing. Most of the telecom executives admit to the fact that in the process of making any major financial or technological policy, outsourcing is a major player. Apart from the fact that outsourcing certain business processes is convenient to the company, it is also true that telecom companies save a lot of money by following this suit. For example, about half of the finances within a telecom industry is spent on network management. Other segments that require a lot of time and finances include customer care, billing, recruitments etc. With the advent of Business Process Outsourcing (BPO) though, the telecom industries can easily outsource the above mentioned services and processes.

Especially for telecom industries based in the first world nations or developed nations, where work force is extremely costly, outsourcing their business processes to BPOs based in third world nations like China, India or the Philippines makes for a major cost-saver. With the major processes outsourced, the telecom companies are then better able to utilize their time and management by focusing into expansion and other company policies aiming at expanding their customer base. Apart from this, outsourcing processes like customer care to BPOs also ensure that all their customers get complete and proper attention, hence assuring a loyal customer base. Then again, outsourcing also ensures that these companies get the latest of technological aid, which would have come extremely costly if the company had decided to do it themselves.

The telecom industry finds itself gaining from outsourcing and the trend is only going to dig further into the industry.

Cyber Corridor and its Impact on the Philippines Call Center Industry

As in recent news, the President of the Philippines, President Arroyo has been on a tour of the cyber Corridor. For those uninitiated, the cyber corridor is the site where most of the IT firms and BPO offices are housed. According to the president, the industry needs to bring in more vigor in order to give more candidates jobs and a consecutive boost to the Philippine economy.

The BPO industry was first launched in the Philippines in the year 2001, with a mere 2000 workers population. Today, however, the BPO sector alone contributes to around 5 to 6% of the total GDP of the Philippines. The year 2009 saw incoming revenue of US$7.3 billion alone from the BPO industry. According to projected estimates, it is further expected that the figure will rise to $13 billion by the year 2011, and by the end of year 2020, the figure is expected to cross the $100 billion mark! This will amount to almost 20% of the total business that is generated universally in this sector.

With TESDA’s developmental plans and the P500 million fund by the Arroyo administration out there to bring out more trained professionals in the field of business outsourcing, the future of the BPO industry in Philippines looks extremely bright. Though it is presently just a notch behind India in rankings, with a number of people joining the outsourcing business, it is soon expected to overtake its competitors and become the first choice for those looking for outsourcing services. Apart from the trained staff and multi-skilled labor, the Philippines is also a strategically located geographically, offering it an edge that no other nation in the business has. Then again, as more high-end outsourcing units opening up catering to legal services, design, web, software, medicine and lots of other fields, the BPO industry only stands to gain further ground amongst the entire business outsourcing market. Overall, the future of the BPO industry in Philippines looks good and is bound to give the nation a strong economic boost.

Astute Solutions

Philippines is known to be a world leader in the outsourcing industry. The number of call centers coming up in the country bears testimony to this fact. However, in order to move forward, these BPO units need to employ the latest technologies. Today, old contact center softwares are being replaced by new, dynamic products. One such product is the RealDialog e-service application made by Astute solutions.

Effective communication is the key for any business to function properly and this principle holds strong for the call center industry. This new software claims to take a giant step forward in the world of virtual call centers. This will happen with more efficient responses to customer queries. RealDialog analyzes customer inquiries word by word and is an intelligent system which learns from every user conversation. It enables customer interaction through a wide range of channels, which include voice contact center systems and websites. It can deliver messages to the customer in a variety of forms. Astute claims that this technology will enrich the whole customer experience by responding to their inquiries with 99% accuracy!

This new application is definitely going to take the market by storm and major call centers in the Philippines are bound to deploy this software on their systems. By doing so, they will be able to facilitate better interaction with their clients and will be a step ahead of their competitors. Technologies such as these will affect the call center industry in Philippines tremendously by reducing IT costs and improving productivity.

The future holds a lot for call centers in the Philippines if they are able to deliver the goods required of them. Employing newer technologies will help these upcoming firms to be up to date with the latest market trends. The RealDialog application is one such technology which will take them towards their goal faster and more efficiently!

$100 Billion by 2020: The Filipino BPO Industry is on its Way

Indian outsourcing officials recently stated that the BPO industry in Philippines is poised to become a $100 Billion industry by 2020. This is a big compliment coming from a country which has proved itself as a top BPO destination of the world.

Philippines has become a favored outsourcing destination in a very short span of time. The call center industry here has also flourished due to the majority of English speaking population. Outsourcing experts in India feel that Philippines has great potential and that their small population is not a drawback. However, for outsourcing to grow here, emphasis should be made to explore the KPO industry which deals with logical and analytical products. Along with this, the Filipino organizations should train their workforce to be able to deal with such products. Frankly speaking, this applies to every line of work. One needs to keep re inventing himself to stay ahead in the race!

Partnering with countries such as India and China will also be very beneficial for BPO units in Philipinnes. This is mainly because they are established players in the field along with having a huge, experienced workforce. Business Processing Association of the Philippines (BPAP) officials have stated that they are on course to make such dealings and that they are working towards developing a strong workforce to meet future challenges. They are also hosting the first International Outsourcing Summit in October this year.

With the amount of business expected from outsourcing, the call center industry in the country will grow exponentially in the years to come. With great developments in “next wave” cities like Cebu, Iloilo and Davao City, a great number of call center jobs will be created. Philippines is on its way up to become a leading hub for established contact centers and the time is just right for investors to make profitable investments in the country.

Philippines - 7th Most Favorable Outsourcing Destination

A.T. Kearney’s Global Services Location Index (GSLI) is a respected index that ranks attractive outsourcing destinations around the world. Its latest edition explicitly states that destinations in Asia, Middle East and North Africa are beating traditional Central European countries in the highly competitive BPO industry. More and more companies are looking to ship their jobs to these locations as they provide good quality and cost effective solutions. Philippines is also a key member of the outsourcing world and it has been ranked the 7th most favorable outsourcing destination by the index. This is great news for the Filipinos as the outsourcing industry in the country is growing at an alarming rate!

Philippines is slowly becoming one of the most favored destinations for outsourced jobs. GSLI’s latest edition is a good indicator of the changing market trends and news such as this will provide a great boost to the already flourishing BPO units here. With more and more call centers being set up in the country, it won’t be long before this archipelago makes its way into the top 5!

India, China and Malaysia have maintained their top three spots, a clear indicator of the dominance Asia has in the outsourcing world. Western European countries such as Poland, Hungary and Slovakia, which were once top outsourcing destinations, have dropped several places in the latest rankings. The index is a good indicator of the business trends as a lot of research goes into it. Each country’s score is made up of a weighted combination on 43 different measurements! Hence, there should not be too much debate on the ability of the index!

GSLI has been an efficient index since its inception in 2004. They have keenly followed market trends and have provided accurate results! Their latest edition has surely given much needed motivation to upcoming call centers in the Philippines. The future looks bright and it is the right time to capitalize on the opportunity!

Increase productivity with Outsourcing

Outsourcing – being the object of interest of most companies to further propagate their business these days, businessmen mainly target call centers as their marketer or vendor of their product or service. Their main advantage is in saving time, labor and money as they benefit from cheaper labor rates in different states and countries.

A call center is an office where a company's incoming calls are received or outgoing calls are made. It is often staffed with representatives who are experts and skilled to give support in customer service, technical functions and to help generate sales. Outbound call centers centralized on making outgoing calls to office and home numbers on behalf of a client. Outbound calls can be a telemarketing, sales or surveys where an agent's success can be measured by the total number of calls made, number of successful leads for sales and telemarketing calls, and tasks completed. On the other hand, inbound call centers focused only on receiving calls from the customers of the company they are supporting. Inbound call centers often use automatic call distribution or by call monitoring by the Quality Assurance staff to ensure that customer service representative was able to assist customer's concern and meets customer's need.

Performance of customer service representatives are being monitored and observed to make sure that they provide excellent service that meets customer's satisfaction. To determine if a call center is achieving good results and accomplishing goals based on the contracts and agreement signed, Company management often use metrics such as customer surveys, retention and sales data.

What Is Outsourcing? Why Outsource?

Size doesn’t matter – all it takes is the correct management of resources for your business to grow, I tell you. Many of the companies now are turning several branches of operations of their business to third-party experts. That is called outsourcing.

Outsourcing is seeking and hiring services of another company to do a particular function for you and for your company. Among these is Virtual call center services such as customer service, billing and data entry and technical support. This allows the owner to focus more of his precious time to other more important aspects of his business to save time, money and infrastructure. Why? Since the purchasing the necessary tools and facilities needed for your operation is now handed off to third-party professionals. You can get expert and skilled services on outsourcing too thus; you can save on manpower as well.

A good businessman thinks of the consequences first before leaping into a final decision. Outsourcing has disadvantages too. One of these is that outsourcing often eliminates direct communication between a company and its clients. Lack and delay of communication jeopardizes the control of the company. Once dependent to outsourcing, the company, itself, missed building solid relationship with their subscribers or customers that sometimes bring dissatisfaction to them for they can't address their concerns directly to the company. This is where a spontaneous communication should be fitted in. You miss this one factor for outsourcing and this will end up to losing your valued customers and eventually losing your business.

Are you a good businessman? If you want to engage in outsourcing, choose the right vendor to market your product and services.