Move Over, India: The New Leader in the BPO Scene

Monday, April 29, 2013

The Wall Street Journal (WSJ) reports how India is losing its seat as the premier business process outsourcing (BPO) location in the world.

According to WSJ correspondent Abheek Bhattacharya, India is facing steep competition in the IT-ITeS industry as the Philippines and Mexico, two countries that were once thought of as India's juniors in the BPO scene, are quickly catching up with the BPO giant. In fact, Bhattacharya reveals that a lot of Western companies are turning to the Philippines to outsource their IT and IT-eS needs.

India: The IT Stronghold
India lost 10% of the global BPO market in the last five years. Experts believe that the losses could be attributed to India's firm belief on services that upholds its specializations rather than explore other services and options. Mexico and the Philippines, on the other hand, are quickly broadening their horizons to cater to the growing needs of the Western communities. For one, Bhattacharya points out that majority of Western companies are not looking for someone to provide ordinary server maintenance service. Rather, they need to collaborate with BPO firms that can steer them to a new direction that will improve their bottom lines.

The Competition

Meanwhile, the Philippines grew an astounding 69% in the IT-ITeS sector in the last five years, according to a survey spearheaded by India's outsourcing body, Nasscom. Similarly, the Information Technology and Business Process Association of the Philippines, an authority in BPO in the Philippines, revealed that last year's revenue exceeded expectations. In fact, the BPO industry earned 18% more in 2012 by bringing in $13 billion, in contrast with 2011's $11 billion revenue.

These figures indicate that the demand for BPO services in the Philippines could only go up.