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The Philippines as an ideal offshoring destination

I was listening to this August 14 episode of the Chris Pirillo show during my train ride home last Thursday.  Chris and his S.O., Ponzi, were just talking about telemarketers calling in during live airings (or streamings) of the show when a telemarketer selling cable subscription called in.

I almost laughed out loud with what I heard.

And it wasn’t due to the fact that a telemarketer was calling in on a live internet-radio show.  What hit me was how Chris was messing with the poor guy, asking impossible-to-answer questions and posing out-of-this-world client requirements.

It was apparent that the telemarketer was calling from India, judging from his accent and diction.  And it seemed he didn’t know what he was talking about in the first place!  Making sales calls over the phone is difficult enough, and it is more so if you don’t have a clue about the culture and needs of your client.

The telemarketer was calling Chris Pirillo, a well-known media personality in geek and even non-geek circles, who claimed he does not, and could not have internet access from where he lived.  And the telemarketer believed–he offered a dialup Earthlink subscription for US$ 20 (which is considered expensive already even for broadband).  All this time, Chris was airing the audio-cast live over the ‘net at the time of the call (presumably over a super-fast broadband connection).

So much for no internet access, huh?

That makes me think about India’s dominance in the offshoring industry, as opposed to what is still an emerging industry in the Philippines.  Yes, they have brilliant Programmers and analysts over at Mumbai or Chennai.  But still when it comes to communication skills, I would tend to believe Filipinos learn better and more easily in terms of accent neutralization and cultural familiarization.  You’d be surprised how Pinoys sound as American as Americans themselves.

After all, the Philippines was colonized by the U.S. for about half a century.  Many would argue that colonial mentality here would render us still a de-facto colony many years after the Amercan occupation.  So maybe when it comes to offshoring by American firms, I’d say we’re the best to turn to.

In this July 4, 2005 article on Time Magazine, William Green describes how he invested in a company that operates a small call center in Manila, and he was very satisfied with how the center’s agents spoke: Most spoke with an uncanny approximation of an Indiana accent.  He captured the essence of the call center industry here in two sentences:

Filipinos are not famed for their brilliance at telemarketing, which requires pushiness, but they are prized when it comes to the gentler art of customer service. The nation’s other outsourcing edge is more basic: it has a large population of English speakers who will work for relatively meager salaries.

A crucial lifeline, Green calls the Philippine call center industry.  For in difficult times, Filipinos are turning to working for offshored operations because it’s practically the only means to earn good money nowadays that will not always require having an college/undergraduate or post-grad degree.  Many have the skills and the learning ability.  And it’s a good stepping-stone to careers elsewhere that require good communication skills.

And the English?  I’d bet it’s our competitive edge.  And this is why we have to focus well on improving education especially in this area.

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  • Pinoy girls are hot too 😛

  • bit

    Although I would vocally oppose certain aspects of how the call-center industry is going right now, I still believe that there it plays a big part in our current economy.

    And yeah, English education here is spotty at best. I think that I wouldn’t be so wrong to think that at least half of our teachers in the country don’t have a firm grasp on the English language.

  • I think it has more to do with the way our tongue can adapt to the western accent compared to the rest in Asia, esp. India.

  • AnP

    I agree. Our accent is easier to understand.

  • Maybe it’s just me, but I wouldn’t call “sounding American” an advantage. I spent high school in Cebu International School and I have no doubt that Filipinos have an easier time assimilating the English language … but what is the real value of this “advantage”? I’m probably going to get a lot of flak because of this post, but why are we proud of this? If being a leader in the “call center” industry is all we want, then it’s all well and good. But that is not what is important. Microsoft does not have RnD departments in India because Indians sound like Americans (even though a lot of their engineers do, have a look at MS’ Channel 9). “Americanized” accents will come, but the emphasis should be producing bright young minds. Whether those brilliant minds sound like Apu or Indiana Joe is irrelevant. The realities are far different from what is ideal, but I hate it when we settle for something that a lot of Americans don’t want to do, and then go so far as to brag about it.

  • nic

    i’m with vern on this, at least on us touting that our ‘american accents’ will be the saving grace of our economy. while call centers play a substantial part in boosting foreign investment, at least in the short term, it’s still a very low-value add industry. in a few decades, when the chinese learn to speak english properly (we’re sending people over there to teach them to do just that), there’s not much of an edge (well, aside from our closer link via pop culture – if that can be considered an edge). call centers are good, but i just hope we take the next step and have some more value-add.

    as far as overtaking india, they’re still way ahead as far as infrastructure and experience in this industry is concerned. maybe filipinos are easier to teach, but local call centers still hire indian accent neutralization coaches. i guess that speaks for itself.

  • bit

    YES! I’ve been holding back on this issue. Thank you, vern for saying that. Kudos to nic as well. I agree with you two 100%. 🙂

    (I have related comment somewhere here…)

  • bit

    Sorry… I have to correct myself. (Can a mod edit my previous comment and delete this one?)

    * Thank you vern for saying that.
    * (I have a related comment somewhere here…)

  • Hi Bit.

    I edited your second-to-the-last comment. Is that adequate? Would you like me to delete your last comment also (I didn’t quite understand how you wanted the edition, so I’m not deleting the last one yet).

    Angelo

  • bit

    Actually, if you could replace the text in the parens with the text in the parens in my last post… but if it’s too much trouble, it’s alright. Thanks. 🙂

  • Hmm … I didn’t expect this post to generate this much discussion. I agree with you, Vern, Bit and Nic. Eventually, other people might beat us in terms of the accent neutralization, but IMHO, it’s the cultural aspect that matters.

    Wouldn’t you agree that Indians are most likely be more comfortable dealing with Britons, given their historcal background?

    In terms of “Americanization,” I can say that the handful of Pinoys working in the outsourced industries have an edge because of the exposre to the American culture, brought about by various factors, including proliferation of American content in the mass media.

    So it’s not just the “sounding American” aspect that can give us a competitive edge. It could be more of the “being Americanized.”

  • Most companies outsource to india for the sheer volume of professionals they produce specifically in the tech industry. Having worked in the Contact Center industry myself; I noticed that companies tend to outsource the customer service or sales part of their call center operations to the philippines and the tech support part to india.

    My company worked closely with a leading US VoIP provider and the above holds true.

  • bit

    The country could use more companies like http://infoweapons.com/

  • Keyser Soze

    Hi everyone. Hi J. Newbie here.

    Apparently, I got Jspot bookmarked on my browser (bet I did it during the Faye fiasco) so I followed the link and eventually ended up here.

    Anyway, in my opinion, Jangelo appropriately narrowed down the topic to focus on communication, and in that regard, “sounding American” is definitely an advantage. Is there an argument to be made against pinning our economic hopes on the call center industry? Sure. Is there an argument to be made against prioritizing speech over our other skills? Of course. But these topics fall under the whole call center issue. It would have been better, I believe, if Vern offered his comment as more of an offshoot or additional commentary on the industry in general, and not, as it appears to me, as a criticism of this particular post. He could have given us a “we should not rest on our communication laurel” message instead of painting the pride we have for our english skills as pointless bragging.

    If we are to talk about Lance Armstrong and laud him for his mountain climbing skills, don’t you think it unfair if somebody comes along and points out that such talents won’t do him any good as an NFL linebacker?

  • Hi Keyser. Thanks for visiting pinoy.tech.blog. I’m sure there are a multitude of arguments we can come up with, in discussing the offshoring phenomenon the world is seeing. This is exactly what we’d been learning about in school (i.e. my own experience during my undergrad econ years). Now that it’s getting to be a very obvious reality, the concept of globalization is giving everyone a loud wake-up call.

    We’re no longer in the 20th century. Things have surely changed.

  • American customers are irate when dealing with Indian Tech support since they are having problems understanding their accent.

  • As a filipino – I wouldn’t focus only on the call center agent jobs that are brought to Philippines as a result of call center offshoring. As businesses move in, there are chances to build expertise in some of the technologies that enable call centers in Phil.

    For instance someone needs to configure the VOIP network that connects calls between Phil. and USA. There’s a high bar for excellence in this area, and even in USA not too many people are qualified experts in the field.

    Manufacturing outsourcing to China has a 20 year advantage on call centers in Philippines – but it makes a good parallel to look at. Right now, if you want to find the real world experts in textile manufacturing technology, who really know how to optimize high volume production, I would suspect the place to look would be in mainland China.

  • riche

    hey, i’m from dumaguete…a small city but look how it is doing. it has attracted big time players such as spi technologies and teletech…isn’t it about time the world notice the usually quiet and gentle dumaguete…?

  • riche

    hey, don’t you know that dumaguete has the highest hiring rate for callcenters in the whole philippines? and do you know that dumaguete, the home of silliman university, is the home of the country’s literature luminaries such as the tiempos, and the first writers workshop in asia? now take a look at dumaguete…

  • Yes, I know, thanks to Dominique Cimafranca.

  • riche

    mparaz, kilala mo si dominique? are you from dumaguete? saan ka ngayon?

  • Wait, there are call centers in dumaguete already?

  • no I’m from Manila… know Dominique from the Linux community.

    yup, Dominique posted about Dumaguete call centers, though they weren’t set up the time of post.

  • riche

    teletech is hiring for its dumaguete operations, which will start, hopefully, before the year ends. epixtar was supposed to be there almost two years ago, but it was not pushed through…my God, look what happens now. dumaguete was spared from the epixtar bankruptcy…

  • That’s good news. My father side is from Negros Oriental too 🙂 buhay pa ba yung Garahe bar? Lots of good memories there 🙂

  • riche

    read about dumaguete at the website of philippine business magazine, a publication of the makati business club. all the facts are there…

  • riche

    Garahe bar is still there…and there are now many more bars that have sprouted in the last two years…we are expecting more yuppies to converge in the city as the callcenter and bpo businesses start to pitch their tents in the city. there is already one IT park, and another one, a bigger one, will be built soon with a huge mall and hotels, etc. night life will even become more vibrant. and the good thing, dumaguete remains a very friendly city with lots of good memories to make and lots of nice, educated people around…indeed dumaguete is the place to be in the future…

  • riche

    am actually working here in up los banos at searca. but am still a dumagueteno at heart, because it has given me some of my best memories so far…

  • angel

    hi there.. i just love reading the comments! yeah, it’s true that filipinos speak better english than indians. by the way, im from dumaguete but right now, im working here in fairview. riche, teletech will start its operation maybe next year.. but im not so sure of that yet. meaning, graduates of SU and St Paul will automatically be absorbed by teletech and no other companies can benefit our skills. (Thanks to the City Council and the Provincial Gov’t for approving the “First-Move Policy”..)

    i believe that u’r a sillimanian because u have the sillimanian pride.. at least u’ve shared how good we are in this particular industry especially that most of our young students have been hired for call centers in manila or cebu.

    when teletech opens it’s 5th site in dgte, i’m gonna be back to my hometown.. there are 5 of us here working for teletech and soon, we’ll go back home still for teletech..

    i don’t have any regrets that i’ve been hired by this great company!!! the bosses are super cool and they really do look forward to its official operation in dumaguete..

    so dumaguete, wait for us!! wait for teletech!!!

  • riche

    what batch are you? what course did you take up? yes, am a sillimanian, and also a former iskolar, but am now working here inside UPLB. Hey, there are lots of good news from dumaguete recently. a number of bpo companies are planning to locate there. me, i want to be back in dgte once there are already jobs suitable for me there…by the way, who are the sillimanians you know of here in manila? can we get in touch?

  • riche

    Teletech Holdings Inc., a multinational provider of customer management and transaction-based Business Process Outsourcing solutions, has announced that it will operate a customer management center in Dumaguete City early next year.

    Craig Reines, vice president and general manager of Philippine operations, said their expansion to the provinces is intended to sustain a strong labor pool.

    “Our business planning team believes that additional expansion in the Philippines will be best supported in the provinces,” Reines said in a press release.

    He added that Teletech is currently working with local governments to expand into targeted regions outside of Metro Manila.

    Aside from the Dumaguete expansion, Teletech is also setting up another CMC in Metro Manila, giving their company the distinction of being the customer management provider occupying the largest amount of space in the country.

    With the addition of its new capacity, Teletech expects to employ more than 7,000 professionals in the Philippines by the second half of 2006, positioning the company as one of the largest employers of outsourced services in the country.

    Looking ahead, Teletech expects that the new business will support additional growth, and plans to continue to significantly increase employment in the country through 2007, Reines said.

    “Teletech is very optimistic that the Philippines will continue to provide high quality solutions and value for our clients,” said Ken Tuchman, chairman and chief executive officer.

    “Its highly educated workforce and advanced telecom infrastructure make it a very attractive location for Teletech to expand its English language capabilities.”

    Javier Fortunato, Jr., provincial director of the Department of Trade and Industry in Oriental Negros, hailed the announcement of Teletech as the fruit of their efforts to position the province as an alternative site for Information Communication Technology business in the country

    Teletech will be the second multinational ICT in Oriental Negros in a span of 12 months, in addition to the SPI Publisher Services, operating in the town of Bacong.

    The Teletech site in Dumaguete City will be located in Barangay Calindagan.*AP

  • That is a long post… please just point a link to the source instead.

  • riche

    sori bro…maybe we can edit that? i’ll provide the link…

  • riche

    ClientLogic choosing between Cebu, Dumaguete for new site

    Callcenter firm ClientLogic Philippines is choosing among the cities of Cebu and Dumaguete and other university towns in the Visayas for its third site in the Philippines.

    The facility, with at least 300 seats, will cater to new clients engaged in technology, telecommunications and travel, country manager Danilo Sebastian L. Reyes said in a recent interview…

    BusinessWorld, Nov. 15, 2005, p S1/9

  • riche

    Dumaguete competitive as BPO hub

    BANGALORE, India — neoIT, the leading offshore advisory and management firm for BPO and ITO, issued a capabilities assessment of the Philippines as an information technology ITO and business process outsourcing (BPO) destination.

    The newly released neoIT white paper, titled “Outsourcing to the Philippines: Metro Manila and Beyond,” provides a snapshot of the maturity and competitiveness of Manila and eight other Filipino cities that are rapidly emerging as ITO and BPO destinations.

    The report provides practical answers to the question of how the Philippines stacks up to global competitors such as India, China and Russia and gives insights into the transformations that have occurred in recent years in the Filipino outsourced services market. While Manila has long been the country’s leading outsourced services hub, the government has fostered the growth of alternative cities in order to provide a diverse portfolio of outsource-ready Filipino destinations.

    The report examines, in detail, the cities of Cebu, Davao, Clark, Cagayan de Oro, Iloilo, Bacolod, Baguio, and Dumaguete as well as Metro Manila. Each city was assigned a city competitiveness rating and ranking based on the location’s current ability to provide ITO and BPO services.

    Manila Bulletin, Business Section, Nov. 16, 2005

  • nharra bubier

    I would like to ask if you happen to know where is the location of their recruitment office. I am interested to apply. Thank you so much

  • dimples

    HI RICHE!

    am glad to hear that TELETECT is opening in DUMAGUETE real soon. Currently, I am employed here in Cebu and is very much interested to apply a call center job right in my hometown, Dumaguete. Please tell me their location as to where i can apply.. thanks so much!

  • Hi to all the Dumaguete folks out there. Thank you for your encouraging support. Teletech is opening, finally, so that’s another feather in our cap. But there’s so much more to do so we have to forge ahead carefully yet audaciously.

    Angel, it’s not true that SU and St Paul graduates will automatically go to Teletech. It’s still up to them where they want to work. What we want to do with the FMA is to give Teletech time to grow the contact center business in Dumaguete first. Other BPOs are definitely most welcome.

  • riche

    For more details about teletech, go directly to their website at Careers at Teletech. You may also visit ACSAT or DTI in Dumaguete. Keep looking up fellow Dumaguetenos…

  • angel

    hi dominique.. i keep on visiting your site. ur not aware of it but lately, i keep on reading your articles. thanks for the updates.. when will teletech dumaguete start its operation? we still do not have any updates here.. we want to go home na.. 🙂 and hopefully, spend christmas with our family. dominique, will u be part a big boss there? hhhhmmmm… gotta login now!!

  • Hi, Angel. Thanks for visiting. Post ka naman ng comment so I’ll know 😉

    Teletech is already hiring for local positions. I think it’ll start early next year. For now it’s mostly groundwork. I won’t be part of the company, though, as I prefer to work on my personal projects for now.

    Looking forward to getting you guys back here!

  • Angel

    Dominique, thanks for the info. So you got a new job and will soon move here in manila. 🙂 I’m so happy for your achievement. I don’t know you that much but I believe that you’re such a great man!! Keep it up.. I read your article (Something about revising your resume and including your achievements for the past 10 yrs). I just can’t post a comment there.. My pc won’t let me.. I.T. has already barred me from getting more access with my system. 🙂

    I thought you would be part of TTech-Dgte.. I was hoping you will be..

  • Triple Play is being pilot tested in Dumaguete.

  • Bayantel Pilot Tests triple play in Dumaguete

    BayanTel chief executive consultant Tunde Fafunwa revealed recently that commercial application of a triple strategy (or the ability to deliver voice, video and Internet to households from a single pipe) approach between BayanTel and Pilipino Cable Corporation (Dumaguete), an affiliate of Sky Cable, is now being completed in Dumaguete City, one of the most progressive cities in Visayas.

    Dumaguete presents an exciting area to roll out the triple play service, considering the area is a major destination of business process outsourcing companies (BPOs) like call centers that is expected to grow the economy in the region. It is also a strategic area for BayanTel as it is a major point of presence for its NDTN network and where Sky Cable through PPC and BayanTel has a significant market presence.

    With the service, Mr. Fafunwa said Dumaguete City residents can enjoy VoIP, broadband Internet and Sky Cable TV channels from a single line into their households. The service is expected to be launched by next month as monthly fees and other commercial issues are finalized.

    Mr Fafunwa highlighted existing partnerships between ABS-CBN, BayanTel and Sky Cable that leverages on synergies in technologies from the sister companies.

    Fafunwa has mapped out a triple play strategy for BayanTel by leveraging on its synergies with other key Lopez Group subsidiaries ABS-CBN and Sky Cable.

    The strategy was borne out of the directive of BayanTel and ABS-CBN CEO Eugenio Lopez III, who believes the Lopez Group is the only entity at present that has the content and distribution capabilities to execute a triple play strategy.

    http://www.bayantel.com.ph

  • reading this article really wanna makes me cry.. william green (whoever he is) sees us filipinos as an art in the customer service dept, didnt PLDT read that issue of time magazine?! f*ckers!

    working from the “sunshine industry” myself, both in the call and the IT department, i say we are indeed an ideal offshore destination.. however, i believe we have a lot to offer than being a cheap alternative; i cant pinpoint it all out but just thinking about it, sure does feel nice..

  • lei

    hi! i heard so much about teletech that is soon to open in dumaguete. i am recently working in cebu in another call center company but i am interested to apply and work in dumaguete coz its near to my hometown in siaton. can anybody tell me what positions are available and what are the requirements?
    thanks a lot! dumaguete will surely go a long way..

  • same as other callcenter companies. better yet, call or visit teletech office at the back of mart one, beside YL marketing in Dumaguete City. you could also search in the web, particularly jobstreet.com, about the positions available, and the requirements. dumaguete has indeed gone a long way in attracting investors, not just in the callcenter and bpo services, but in other areas as well…

  • I would like to apply in Dumaguete Teletech and want to be a part of your call center…

  • CHR

    We have almost completed the construction of our temporary location and looking forward to our permanent location which will be finished later this year. Cathy, you can apply through Hirepoint.com or through any of our recruiting offices. We have 2 client programs that we will be hiring for and we are very excited to get started. Just hang in there!

  • legend

    we’ve been waiting for info about ttech – dgte. we keep on hoping that the remaining 4 dumaguete reps here in ttech – nova will soon be transferred to dgte. we’re not expecting but just hoping.. 🙂 we’ve already forgotten that we submitted our applications for dgte.

  • Hey Angelo, congratulations for such a nice and wise blog! I agree with you in your post “The Philippines as an ideal offshoring destination”. By the way, me and my wife are running a new project about Process strategic planning and many other business opportunities. I find your work interesting and you may have the professional skills we need. Keep writing, we will contact you!

  • Hey Angelo, congratulations for such a nice and wise blog! I agree with you in your post “The Philippines as an ideal offshoring destination”.

    I find your work interesting and you may have the professional skills we need. Keep writing, we will contact you!

    Thanks for the comment, sir. Will expect word from you, then.

    Angelo

  • legend

    hi guys.. im in dgte now.. yehey!!! thank God.. people here are super cool and it’s so nice to think that im back to my home sweet home..

  • SPI to transfer some Manila operations to Dumaguete

    Business process outsourcing firm SPI Technologies, Inc. is set transfer some publishing operations from Metro Manila to its facility in Dumaguete City, in Central Visayas.

    “Manila is getting extremely crowded with players, there are so many players right now. And this results in labor shortage and inflation,” Mr. Cu said.

    More about this story here or here.

  • SPI to transfer some Manila operations to Dumaguete

    Business process outsourcing firm SPI Technologies, Inc. is set transfer some publishing operations from Metro Manila to its facility in Dumaguete City, in Central Visayas.

    “Manila is getting extremely crowded with players, there are so many players right now. And this results in labor shortage and inflation,” Mr. Cu said.

    More about this story here or here.

  • emac

    visit http://www.pinoycallcenter.com for call center in the Philippines. Find jobs. discuss. business process outsourcing.

  • That’s true! The Philippines is an ideal offshoring destination in Asia. The outsourcing industry here is rapidly booming. Thanks for the blog.

  • Excellent article, I couldn’t agree more! Without much fun fare, global marketing and globe trotting, the Philippines became a natural choice and a preferred destination by Global Business Process Outsourcing (BPO) companies today. This phenomenon came about just through word of mouth from existing BPO players in the country. After setting their back offices in country BPO global players learned from their back office experiences how world class the Filipinos were when it comes to the voice services. BPO companies realized how Filipinos were excellent in their command of fluent English with a neutral accent.