Philippines Remain as one of the Top Destination for BPO and Shared Services in the World.

The Philippines has strengthened its position as one of the top destination for BPO and Shared Services in the World. The country was ranked 3rd for 2014 and 2nd for 2015 up by one notch this was according to a report by US-based global real estate adviser Cushman & Wakefield entitled “Where in the World? Business Process Outsourcing and Shared Service Location Index 2015”.

The list may look surprising because India took the 20th spot however; the methods used in the rankings were based on the following factors:

1. Conditions 30 % – conditions like IT infrastructure, education and English proficiency.
2. Risk 20% – the risk factors include economic stability, political stability, corruption perception index, and energy security.
3. Costs 50 % - cost of labor, building costs, inflation, and property cost.

Below is the top 10 list, lower number is better.

Here's the full list.

REGION	Country	RANK	CONDITIONS	RISK	COST	2014 RANK
APAC	Vietnam	1	15	28	6	5
APAC	Philippines	2	34	27	2	3
EMEA	Bulgaria	3	3	17	10	14
EMEA	Romania	4	5	10	12	1
AMERICAS	Peru	5	29	16	5	7
APAC	Malaysia	6	25	9	8	11
AMERICAS	El Salvador	7	36	32	1	6
AMERICAS	Brazil	8	26	15	9	18
EMEA	Hungary	9	9	20	15	17
APAC	China	10	19	13	14	10
EMEA	Lithuania	11	1	30	19	New Entrant
APAC	Sri Lanka	12	27	33	7	9
EMEA	Morocco	13	30	35	4	12
AMERICAS	Chile	14	18	21	16	New Entrant
AMERICAS	Honduras	15	35	36	3	8
EMEA	South Africa	16	28	23	11	15
EMEA	Czech Republic	17	12	8	21	13
EMEA	Poland	18	17	11	20	16
AMERICAS	Colombia	19	24	14	18	22
APAC	India	20	32	31	13	21
AMERICAS	Costa Rica	21	31	26	17	19
EMEA	Russia	22	16	18	22	24
EMEA	Turkey	23	21	29	23	25
AMERICAS	Mexico	24	22	22	24	26
EMEA	Germany	25	8	3	27	29
AMERICAS	Argentina	26	33	24	25	23
EMEA	United Kingdom	27	4	4	30	28
APAC	Australia	28	13	5	29	New Entrant
AMERICAS	Canada	29	14	1	31	32
EMEA	Saudi Arabia	30	20	25	28	New Entrant
EMEA	Serbia	31	23	34	26	New Entrant
AMERICAS	United States	32	6	2	32	31
EMEA	Spain	33	11	12	33	27
EMEA	Netherlands	34	2	6	34	New Entrant
EMEA	France	35	10	7	35	New Entrant
EMEA	Ireland	36	7	19	36	33

With government support and better IT infrastructure Vietnam was able to climb on the top spot overtaking the Philippines. Based on the data the Philippines is attractive to BPO Investors because of its cheap labor and low property cost. 

Philippines could go for the top spot if the government would make a move to improve the IT infrastructure (internet connection) of the country because it’s one of worst in the world.  Based on the report by Netindex the Philippines has an average internet speed of 3.6Mbps which put us at the 176th place in the world and at 21st place when compared to other Asian countries.

According to BSP (Bangko Sentral ng Pilipinas) the BPO industry will overtake the remittances sent by OFW’s as the main source of dollar income within the decade. 

If the BPO Industry would be the leading source of dollar remittance, it may be the right for the government to create an organization that would protect the welfare of BPO employees. This is to ensure that call center companies would be in compliance with labor laws. The created agency may also provide assistance to employees who lost their jobs due to retrenchment or account pullout.  If you look at our list of cases filed against BPO companies, most of it are caused by illegal dismissal. 

Few years ago Vietnam trained in the Philippines to enhance their knowledge on rice farming. With proper government support, the end result was clear; we are now importing rice from Vietnam. I hope that the BPO Industry would not suffer the same fate same as the rice industry, where lack of local talents and less government support may prompt BPO companies to outsource the jobs elsewhere.  
Source: http://www.cushmanwakefield.com/~/media/global-reports/Where%20In%20The%20World_Business%20Process%20Outsourcing_low_2015.pdf