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20 April 2008

Manila calling

MetroNow headline on 14 April 2008

MetroNow headline, 14 April 2008

UNTIL THE other day, Manila seldom landed in Indian conversations about Southeast Asian cities. Most of my local friends are not even aware of the city’s close proximity to Bangkok, KL, or Singapore, three favorite Indian travel destinations. (For the record, Manila is a 3.5-hour flight from Bangkok.)

Now, however, that the Delhi newspaper MetroNow has headlined Manila on its front page, the Philippine capital city is famous . . . for call center reasons. On its 14 April 20, 2008 issue, MetroNow reported: “Filipinos take the shine out of NCR as BPO giants shift business to cheaper Southeast Asian cities.”

India’s low manpower cost has made it the world’s top business process outsourcing (BPO) destination, with targets of US$50 billion revenues by 2013 from the current US$11 billion. However, as MetroNow reported, the Philippines has an edge in telecom, infrastructure, safety and security, cross-cultural relations, the support of the government in developing the call center industry, and—most importantly to me as an often-frustrated call center customer— proficiency in English.

I’m glad that MetroNow has picked this up. It’s time Indian call centers learn how to communicate with the most understandable words in the least number of syllables in the shortest possible duration!

Manila vs Gurgaon : the heat is on
by Joel Joseph and Manish Adhikary

  • EXL expands global footprint, commences operations from Philippines Centre, April 8, 2008
  • WNS to drive BPO Services in Philippines, April 4, 2008
  • Accenture launches BPO operations in Philippines, February 4, 2008

If you’re wondering what point we are trying to drive home, let’s kill the suspense. The lines you read above are a few news headlines signaling the rise of Philippines in the outsourcing world. Manila and Cebu in Philippines are beginning to take the shine off cities like Gurgaon and Noida in India. And the livelihood of not only industry staffers but millions of Indian graduates eagerly waiting to join BPOs after college exams in June is at stake.

So, what does Manila have that Gurgaon and Noida don’t? “Lots of things—from work culture to safety and security,” says the CEO of a Gurgaon-based BPO giant.

Sanjay Mehta, managing director of Gurgaon-based Teleperformance BPO also chips in: “An Indian BPO has to deal with four things—transportation, catering (food), security and power generation—before it can sit down and get on with the real business. What’s more, BPO jobs in Manila don’t come with frills attached. The work environment, unlike in India, is similar to that of any other industry. You don’t have to spend a fortune in placating your staff and giving them additional privileges like we do in India.”

Manila also scores higher than India in infrastructure. “The city has better infrastructure with rail networks like the Metrostar Express. The companies there don’t need to waste their resources on safety and security,” says Mehta. Agrees BPO guru and Quatrro CMD Raman Roy, “From airport to roads, from water supply to education, Philippines is far ahead of India. And with the tax advantage they have thanks to their government, more companies are setting up shops there to reap higher profits,” says Raman.

Another interesting and significant area of difference is culture. The HR head of Convergys who takes care of recruitments in Manila as well as Gurgaon, Tim Huiting, narrates a story to explain the difference between Indian and Philippine agents.

“After every presentation, I show the new-hires a picture of a helmet of a popular American football team. No one in India has been able to identify it yet. But when I put the photo in front of Philippine agents, almost all of them shout—Green Bay Packers—the correct answer,” says Tim. “Philippines is more attuned to the Western style of living. They have a better understanding of the customers they talk to over the phone,” says Tim.

Another striking fact was revealed by Mehta. He said, “In Manila, you don’t generally get pickups or drops. You sleep in the office dormitory after your shift ends. Companies don’t spend too much on food and similar such facilities that are a given here.”

Speaking about the Philippines government’s role in helping the industry take off, Nasscom vice chairman and Genpact president Pramod Bhasin says, “The Filipinos are pretty excited about outsourcing. Their government has only recently sanctioned over USD100 crore (USD1 billion) for educating people to help them get a BPO job.” This is in contrast to the Indian government’s kill-the-golden-goose mission, say industry experts.

In an exclusive chat with MetroNow after joining EMRI as member of the governing board, former Nasscom president Kiran Karnik had said that the government had failed to acknowledge the headroom for growth our industry has. “The silence on extension of STPI scheme is very disappointing,” he had said.

Another important element is command over English. The English that Philippinos (sic) speak is superior to ours, which means you have to spend less to train them. BPOs in Manila don’t need to offer the traditional benefits we get working in a Gurgaon BPO like lunch, breakfast, or dinner.

So, the BPO industry in India—already under a lot of stress, what with the slowdown in the US, the depreciating dollar, talent crunch and an insensitive government—now finds itself in a tricky situation.

“It’s more serous than a tricky situation,” says another CEO, who did not wish to be named. “EXL, a big Indian BPO success story, is not eating the proverbial pie in the sky when it opens shop in Philippines. There are concrete reasons behind the move,” he says.

The trouble is many in the US believe that South East Asia is the place to be. And if the industry concerns are not addressed soon, our BLP dream can very easily turn into a nightmare.

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