The growth of call centre services in the Philippines has been one of the great economic success stories of the 21st century. Outsourcing had become an increasingly common business practice during the latter part of the twentieth century, but the Philippines had not been considered a player. “By the end of the twentieth century, India was the dominant global provider, owing to its success largely to low prices, which meant many businesses overlooked the communication problems of heavily accented call agents. The Philippines, by contrast, had just a handful of call centre providers,” says Ralf Ellspermann, CEO of PITON-Global, one of the leading call centres in the Philippines.
Government policy lit the fuse of the sector’s explosive growth. The Philippine government created economic zones designed to encourage investment. Foreign companies were offered incentives to locate services in the Philippines. Although not aimed at contact centres, they were among some of the first to take advantage of the policy.
The growth, however, was largely down to factors that made the Philippines a natural home for call centres. The first was the exceptional workforce provided by Filipinos. The country has high levels of English-fluency, but these are enhanced by a strong cultural link with the West and a good educational system. “This meant that Filipinos could often communicate with English-speaking customers with little accent and a good understanding of colloquial English. A customer calling from the Australian outback would not phase a Filipino call agent the same way they might from other countries.
“But this was also combined with low labour costs. This meant that a high-quality customer service function, frequently providing a better service than was previously delivered in-house, was still around 40–50% cheaper,” says Ellspermann. Therefore, call centres in the Philippines were able to compete with the early leaders in offshore outsourcing on cost while typically offering a better service.
Their reputation has grown, and despite the standing start, the Philippines is now the world’s first choice for call centres: more businesses choose a provider there than anywhere else in the world, with even the once-dominant India languishing as the second choice.
The sector now offers a considerable degree of security for businesses looking to outsource. It is a mature sector, and there are Filipinos now at senior levels, having started in the industry when it first arrived. And because of its size, it can rapidly scale to meet the changing demands of its clients, whether responding to predictable changes or surprise surges in demand. And, finally, it continues to benefit from the support of a government that recognizes its economic importance. The Philippine government, for example, frequently aligns laws and regulations with Western standards to ensure contact centres can compete easily for contracts in demanding sectors like finance and healthcare.
“The Philippines has a unique offer for businesses looking to outsource. With a large and mature industry, companies can be confident in forming a partnership with a premier provider that will save them money and help them delight their customers,” explains Ellspermann.