Client News

Manila, Cebu in Tholons’ top 10 global outsourcing destinations

(Manila, Philippines, January 31, 2013) — In the latest annual ranking of the top 100 global outsourcing destinations by Tholons, a services globalization and investment advisory firm, Manila (NCR) claimed the number three slot, following Indian cities Bangalore and Mumbai. Manila, ranked No. 4 in 2012, has overtaken Delhi (NCR), India. Cebu City, formerly at No. 9, also went up one rank and pushed Dublin, Ireland from the eighth spot.

More Philippine IT-BPO hubs were also included in this year’s ranking. Although Davao slipped one rank to No. 70, Sta. Rosa City in Laguna climbed two spots to No. 84 while Iloilo is No. 93. Bacolod City re-enters the list at No. 94 and Baguio City is a new entrant at No. 99.

According to Tholons, the Philippines enjoys a more vibrant IT-BPO industry than either Indonesia or Malaysia. These three countries are considered the most promising Southeast Asian destinations in 2012. The region’s “maturing outsourcing brand, improving macro-economic environment, and expanding domestic markets” were cited as the reasons why large service providers prefer Southeast Asian markets, hence their upward movement in this year’s ranking.

Tholons reported that in 2012, “the Philippines IT-BPO industry was fueled by increased new investments from large and mid-sized foreign providers, as well as greater expansions of established locators and captives across many of the country’s established delivery locations.”

“The Tholons’ rankings and report overview only reaffirms the Philippines’ position as a destination of choice for outsourcing services. In 2012, we saw impressive growth across all sectors of the Philippine IT-BPO and GIC industry. The year 2013 promises to be even greater as we expect revenues to increase to US$16 billion to provide employment to 926,000 Filipinos,” said Benedict Hernandez, president and CEO of the Business Processing Association of the Philippines (BPAP).

Tholons also acknowledged the efforts the Philippine IT-BPO industry has been exerting to maintain its global leadership in voice BPO services while also expanding into other outsourcing sectors—including software development and IT outsourcing, animation and game development, and healthcare information management (HIM) outsourcing—and looking to penetrate markets outside the US.

“Based on the events of 2012, the Philippines continued to garner interest from large, Western providers, not only as an offshore delivery location, but likewise as a potential rich domestic market for IT Services,” the Tholons’ 2013 Top 100 Outsourcing Destinations said.

Among the events in 2012 that were catalysts for significant investments and expansions in the country’s IT-BPO space and were noted by Tholons in its report were Teleperformance’s decision to establish another delivery center in Mandaluyong City over Canada; Convergys’ 18th call center in the Philippines in Mandaluyong City; and IBM’s continuous growth in BPO services with focus on higher value analytics and high value customer support services.

Because of the market demand created by the US Patient Protection and Affordable Care Act, healthcare BPO in the Philippines was the fastest-growing sector in 2012. US-based healthcare provider UnitedHealth established back-office operations for healthcare in Taguig City while EXL plans to open its third center in Cebu City to deliver healthcare and insurance-related services to US clients.

Tholons also noted that a forum jointly conducted by the Philippine Embassy to the UK, the Philippine Trade and Investment Center-UK, Sitel, and UK National Outsourcing Association marketed the Philippines as a destination of choice among potential UK-based IT-BPO investors and clients.

“IT-BPO will remain the fastest-growing industry in the Philippines as we continue to address challenges and embrace opportunities in new service areas and emerging markets. We are steadfast in ensuring that the industry will achieve its targets of US$25 billion in revenues and 1.3 million full time employees by 2016,” Hernandez said.

About the Business Processing Association of the Philippines
The Business Processing Association of the Philippines (BPAP) is the enabling association for the IT-BPO and GIC (global in-house center) industry in the Philippines. BPAP serves as the one-stop information and advocacy gateway for the industry. With approximately 300 industry and support-industry members, including five associations—the Animation Council of the Philippines, Contact Center Association of the Philippines, Game Developers Association of the Philippines, Healthcare Information Management Outsourcing Association of the Philippines, and Philippine Software Industry Association—BPAP plays a pivotal role in sustaining rapid growth of the IT-BPO and GIC industry by working to ensure an enduring supply of high quality labor, supporting service innovation, and providing country visibility.

BPAP assists investors in setting up operations easily and quickly in the Philippines. Relevant research, introductions to key government and industry officials, and a series of briefings at each step of the investment process ensure a seamless development process. On-going support is provided through a wide variety of initiatives, including programs for HR development, business development, and on-going knowledge sharing and networking opportunities.