Keeping costs under control without sacrificing quality can be challenging when running a business. Businesses are constantly looking for methods to help them strike the perfect balance. To achieve this, many companies acquire quality workers from around the globe in niche labor markets that provide highly qualified, educated individuals without compromising quality. This process is referred to as outsourcing.
When a company is transitioning through its many growth stages, outsourcing is a great approach to support it.
It helps recruit quality employees in lower-cost economies to leverage their cost efficiencies. And when it comes to lower-cost economies, businesses from all over the world consider the Philippines to be one of the greatest countries for outsourcing, as it has one of the fastest-growing economies in Asia.
In this article, we will walk you through the major benefits of outsourcing talent from the Phillippines. But first, let us have a quick look at what outsourcing could mean for a business.
What is Outsourcing?
The practice of recruiting a third party from outside a business to carry out tasks or manufacture products that were previously done in-house by the business's own employees and personnel is known as outsourcing. Outsourcing helps businesses reduce labor expenses, such as staff pay, overhead, equipment costs, and technology costs.
Companies can utilize outsourcing to cut back on non-essential processes and concentrate on their core competencies while transferring the less important ones to third-party companies.
Business process outsourcing (BPO) refers specifically to firms that contract out several facets of their operations to a third-party provider. The manufacturing sector dominated the outsourcing business for many years, but today it encompasses a wide range of products and services.
Organizations may outsource a variety of operations and tasks, including human resource management, customer support, accounting, manufacturing, content writing, research, shipping and logistics, IT operations, and more.
The top countries for outsourcing services include India, the Philippines, the United States, Poland, Brazil, Malaysia, Ukraine, and South Africa. The Phillippines ranks among the top three countries and has retained the title of "The BPO Capital of the World" since 2010. Also, being a former Spanish and American colony provided them with cultural compatibility with more developed countries.
Below are a few reasons how outsourcing to the Phillippines can help avoid the time-consuming process of acquiring and training new employees while allowing firms to expand.
Reasons for Outsourcing to the Phillippines
1. Larger Talent Pool
Even though it's a common misperception that business process outsourcing in the Philippines is only available through call centers, there are many companies that offer talent in a wide range of industries, including customer service, financial services, human resources, accounting, eCommerce, web development, digital marketing, and administrative support.
Organizations can easily and rapidly hire a ready and willing workforce. The country holds a 97.5% literacy rate, and every year, a large number of highly qualified employees pass out from universities. If you put together a talented team abroad, you will have more access to talent at a fraction of the expense of building the same team domestically. You can check out profiles of highly skilled Filipino virtual assistants and virtual employees here.
2. Lower Employment Costs
When compared to services offered by other nations, the Philippines offers a top-notch workforce at a reduced cost. The cost of employing labor in the Philippines is nearly half that of the United States or the United Kingdom. A more economical workforce enables businesses to make significant financial savings and lowers tertiary costs associated with office space, legal and HR costs, latest equipment, taxes, etc.
In addition, outsourcing to the Philippines enables companies to customize employee benefits that are reasonable for the workforce but less expensive than they would be for in-house employees. The hiring and training of employees can be handled by the outsourcing provider, allowing business owners to focus on important tasks of their operations.
3. Superior Linguistic Abilities
When it comes to outsourcing services, one of the most important criteria for diverse organizations is their capacity to communicate effectively with their clients. For the company's offshore employees to effectively engage with clients and meet and outperform business goals, they must have excellent English skills.
The Philippines ranks second in Asia in terms of English competence and there are approx 60 million English speakers in the country. Because of this, they are a potential choice to provide call support and assistance to Western nations. Additionally, they have the ability to use terminologies and accents that appeal to a wide range of clients.
4. Reduced Legal Liabilities and Management Issues
One drawback of operating a business is being exposed to legal obligations and trivial claims made by internal employees. In light of this, many companies choose to outsource in order to reduce their legal obligations and management concerns. Outsourcing service providers can help your company lessen the chance of risks like workplace hazards and compromised data.
By outsourcing to the Philippines, you can avoid lawsuits while also saving time and money on the hiring and management processes. The services also come with a dependable HR and administration team that can support with task delegation, tax returns, and setting up and allocating training projects.
5. Cultural Compatibility
The lifestyle as well as many western cultural customs have been embraced by the Filipinos. They are able to converse about common interests like sports, politics, television, news, or professional issues with their international business partners because there is hardly any language barrier.
Because Filipinos are compatible with various cultures owing to their acceptance of western lifestyles, they have an advantage over other countries when it comes to offering upper-edge customer service. They are well-known for their friendliness, hospitality, and generosity of spirit.
Thanks to centuries of influences from Asia, Spain, and the United States, the Philippines has a varied cultural heritage. This makes them very open and simple to deal with; they are social, hardworking, motivated, and customer-focused.
6. Robust Government Support
The Philippine government acknowledges the potential of the outsourcing industry as one of the economic foundations and major sources of revenue for the nation and has established strong infrastructure and support for outsourcing firms and enterprises putting up an outsourced team.
To ensure that the Philippines remains one of the top outsourcing destinations, the government has formed partnerships with the country's universities to develop business process outsourcing-specific programs that would prepare the future BPO workforce.
Additionally, it involves the establishment of TESDA (Technical Education and Skills Development Authority), which assisted in funding call center training facilities and has a distinctive voucher system, tax incentives, and SOPs to support international investment, as well as the founding of the National Information and Communication Technology Council to promote the industry's expansion.
7. High-Quality Deliverables
Numerous reputable research publishers claim that when global client surveys are done to gauge the quality of service delivery, the Philippines' BPO sector consistently comes out on top. Performance effectiveness was essential in enabling the nation to hire 1 million BPO workers during the span of the last 4 years. Thus, if consistent quality deliverables is what your business is looking out for, the Philippines is the right place to look up to.
8. Data Privacy and Security
By ensuring that appropriate legislation and policies are implemented to aid the BPO industry, the Philippine government has played an important part in ensuring that it can flourish and grow in the country. The data privacy legislation, passed by the Philippine government in 2012, ensures that privacy requirements are in line with international standards because outsourcing activities frequently include the sharing of personal data.
Due to the tight laws set out by this act to safeguard sensitive data from unauthorized access, the healthcare sector is also increasingly considering the Philippines as a potential outsourcing location.
9. Customer Service Skills and Hospitality Values
The Philippines' ingrained hospitality culture is one of the reasons other nations have become more interested in establishing enterprises there. The courtesy of Filipino personnel, which comes across as more natural than forced, is what draws foreign nations to it in speech and action. Such a customer-centric strategy engages prospects, increasing the likelihood that they will become loyal clients.
10. Increased Customer Satisfaction
Businesses that outsource jobs to the Philippines are more likely to increase their customer satisfaction rates thanks to improved operational efficiency and expert knowledge, abilities, and values. This provides the companies with several options to develop and thrive over time.
Effective company processes also increase client satisfaction, which encourages repeat business. Business expansions promote better competition within the sector and act as effective role models for others to follow.
11. Strong Work Ethics
Filipinos are inherently respectful people, and this comes through in how they deal with their coworkers, bosses, and of course, their customers. Since they maintain their composure under pressure, even in the most difficult conditions, working under pressure is not a problem. Filipino employees are renowned for having a sense of responsibility and ownership over their work. Filipino labor is in high demand not just in the outsourcing sector but also in other industries due to these excellent work attitudes.
Top Outsourced Business Functions in The Philippines
IT services (54%) finance (44%) payroll services (32%) and customer service or contact centers (22%) are the most often outsourced services from the Philippines. Apart from that, below are the ten most outsourced business functions:
In a Nutshell,
Outsourcing has numerous advantages, including significant cost savings, improved access to talent, enhanced flexibility, and reduced risk of legal complications. The Philippine market is a very trustworthy option for any organization seeking significant growth. With a clear competitive advantage over countries in the outsourcing sector, this archipelago has demonstrated its ability to withstand transformations.
You can begin your outsourcing journey and hire workers directly using a Philippines outsourcing marketplace like VirtualStaff.ph, where you can find, recruit, and pay workers without any middlemen while being confident that you're offering them the actual salary rates!
