November 29, 2006
Move Over India, The Filipinos Are Coming
--By Priya Jestin, Staff Writer
Well, it’s not yet move over time for India. Rather the country has moved up-market in outsourcing. This means there is a market for customer-service call center businesses. And the Philippines has quickly jumped into the fray It may be a low-end, low-margin business, but for the Philippines it has been an employment boon.
The main attraction when it comes to the Philippines is that it is very cost-effective when compared to India. There is however a bigger advantage here: cultural similarities to the United States and employee loyalty. The country has an exceptionally long history of contact with the United States, which includes several decades of American colonial rule. This means call center employees here can relate better to Americans and are also quick to adapt to a variety of accents.
Another benefit of outsourcing to the Philippines is that the attrition rate in the industry is a quarter of what it is in India. One of the biggest reasons for the rise in Indian BPO salaries is the poaching of employees. According to estimates, in some Indian call centers annual staff turnover has been around 200 percent. In Philippines, the corresponding rate is 40% or lower!
India’s huge employee turnover means that the company has to regularly invest in educating and training new employees. This doesn’t look too good on the company’s balance sheet. The longer an employee stays in one company, the better the quality of service. This means the Philippines has a definite advantage over India with its low attrition rates.
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