BPO sector eyeing high-value services

CEBU, Philippines — With an industry affected by US government’s strong stance in protectionism, the Information Technology -Business Process Outsourcing (IT-BPO) industry in Cebu is banking on attracting higher value services in 2019 and onwards.

“We are strengthening our capability in providing high skilled manpower as we are moving on attracting the non-voice services,” said Cebu IT BPM.Organization (Cib.O) managing director Wilfredo Sa-a Jr.

According to Sa-a while the voice outsourcing services or the call center industry is expected to plateau, Cebu will expect a movement in high-paying job requirements.

Some call center firms are even diversifying some of their services to include non-voice offering in order to manage the slowing voice related jobs.

“Some locators are leveling up their talent requirements,” explained Sa-a.

For 2019, although some BPO companies may hire additional manpower, it is not as many compared to other years.

Policy Changes

Aside from the US government’s threat to discourage American companies to outsource their job requirements outside America, the Philippine’s introduction to new policies and regulations also stimulated further apprehensions among BPO companies.

Sa-a mentioned the issue on rationalizing the incentives of companies, including BPO firms that are currently enjoying perks in the cyber zones.

The anticipated implementation of “Trabaho Bill” formerly known as “TRAIN 2”, is something that is closely monitored by outsourcing firms, both the existing locators and interested investors.

The first few months in 2019, companies will have to adopt a “wait and see” attitude, as the change of policies under the second tax reform implementation still has to be finalized.

Tholons ranking

Amid the sluggish movement of outsourcing that is expected to linger during the entire 2019, Cebu is also putting its foot forward because its improving ranking in Tholons’ Super City survey.

Cebu City has climbed a notch higher in Tholons’ 2018 Services Globalization index, hitting the 11th place in the world’s top Super Cities.

From its 12th place in 2017, Cebu was able to show its improvement, although it has to work harder to recover its previous ranking as 8th most preferred outsourcing destination in the world in 2016.

The 11th spot achieved by Cebu City in 2018 however, is not an ordinary accomplishment, as the City competed against big cities in the world like Banglore(1), Metro Manila(2), Mumbai(3), New Delhi(4) and Hyderabad(5), Krakow(6), Dublin(7), Pune(8), Montevideo(9) and Buenos Aires(10).

This ranking , according to Sa-a, will give Cebu the advantage to get the attention of outsourcing investors, especially those that are not based in America. This ranking will make

Cebu more visible to the world.

Still, unlike in the past, that it was easier to predict, the year 2019 is clouded with thicker uncertainties.

“We cannot speculate [the industry’s future for year,” Sa-a said reiterating that the hanging enactment of Trabaho Bill, and US President Donald Trump’s final stand on outsourcing.

Modest growth

Notwithstanding the issues that battered the industry at this time, Cebu is still anticipating modest growth in the BPO sector, Sa-a assured.

This time, hiring will be more seen in the technology-based job requirements, as well as knowledge-based services like engineers, insurance and finance, legal, healthcare, research and development, particularly in the shared-services sector.

“There is no indication of new big ticket outsourcing investors to come to Cebu this year,” noted Sa-a, however the modest growth will come mainly from existing companies that are expanding and trickles of KPO (Knowledge Process Outsourcing) firms that may open operations here.