There are two prominent countries in the face of outsourcing – The Philippines and India. Accordingly, these two lead the way for the rise of the BPO sector in Asia. But now’s the time to answer the age-old question: which is better in the outsourcing game, the Philippines or India?
Before we determine which is the cut above, let’s take a look at the outsourcing background of both developing countries.
Philippine Outsourcing Industry Landscape
The BPO sector in the Philippines was first introduced during the early 90s. Although Western companies didn’t fully invest in the Philippines until the start of the year 2000. With these companies that started to set up shop in the Philippines, the Philippine government created a framework for outsourcing in the Philippines. Moreover, this framework called the Special Economic Zone Act further opened the doors for global outsourcing to the Philippines. To date, the Philippine outsourcing industry already had a growth rate of 10% and is predicted to achieve a total income of $55 billion this year. In addition, the Philippine BPO sector will generate 1.3 to 1.5 million new jobs in the years to come. If the Philippines continues this growth for outsourcing, it will surely give India a run for its money.
India Outsourcing Industry Landscape
Outsourcing in India came a decade earlier compared to the Philippines. In fact, the BPO industry in India started in the early 80s. After the establishment of outsourcing, US-based companies started to capitalize on India. Consequently, this paved the way for robust and world-class outsourcing services that India now offers to the world. Much like the Philippine government, the Indian government also intervened and created policies that benefitted economic growth and made India a credible outsourcing destination. Currently, India has more than 1.1 million workers under the BPO industry. Also, more than 500 companies in India offer outsourcing services on a global scale. With a 35% share of market in the global BPO industry, the Indian BPO industry is projected to become a $54 billion industry by 2025. With all this progress, the state of the outsourcing industry in India is looking positive.
Battle for Outsourcing Supremacy
Customer service is always one of the major tasks that’s outsourced. This means that companies looking to outsource core activities like customer service don’t need to exhaust time and money in building facilities and staff training. All of those will be dealt with by their chosen outsourcing partner. With that in mind, now’s the time to determine which country will better suit your outsourcing needs.
For so long, India was globally recognized as the leading outsourcing hub. While India excels at facets such as IT services and SaaS, there are plenty of factors as to why the Philippines takes dominion over India in the customer service field.
The Customer Service Advantage
First, one advantage of the Philippines is the 92.5% English proficiency rate. This is the main reason why native English-speaking countries such as the US, UK, and Australia prefer to outsource in the Philippines over India. Unlike India, the Filipino accent becomes neutral after some training which makes it more understandable and clearer to native English speakers.
Another contributing factor is culture. Both the Philippines and India have been colonized by the US and the UK respectively. However, only the Philippines integrates Western culture to this day. Because of this, Filipino customer service agents easily understand certain expressions of their Western clients. Furthermore, Filipinos by nature are very welcoming and this contributes to the globally-recognized customer service culture of the Philippines.
In terms of education, the Philippine education system is patterned to that of Western countries. To add to that, the Philippines produces 30% employable graduates compared to that of India’s 10% rate. Supported by the Philippine government, students undergo through a comprehensive training program that prepares them for the BPO industry.
Lastly, labor cost in the Philippines is marginally higher than that of India. Yet, when it comes to outsourcing customer service, the Philippines certainly provides the best talents and quality for the job.
All in all, India definitely has some advantages in terms of outsourcing software and technology support. However, if you’re looking for excellent customer service skills, the Philippines should be your choice. And if you’re looking into the Philippines, check out Telework PH for a scaled-up customer service experience.