The Outsourcing Week in Review: Wednesday, May 20, 2020

Welcome to Inside Outsourcing: The Outsourcing Week in Review

THE WEEK IN REVIEW

A Japanese company announced its plan to invest in a Philippine BPO to add to their strategic portfolio of companies saying it is “not deterred by the short-term effects of coronavirus”. The company is looking to be an investor and active partner in the business and aims to complete the transaction quickly so it can continue to focus on the job at hand and pursue growth – read more.

Following last week’s announcement of the Modified Enhanced Community Quarantine (MECQ) for Metro Manila, and other ‘hot spots’, the government has now released its functional guidelines. Under MECQ, everyone is still required to stay home, except frontliners and those buying essentials. Employees are allowed to go to work, but public shuttle will be the only mode of public transportation allowed under MECQ. This has caused a problem as employees struggled to go to work on their first day back after the two month-lockdown.  Presidential Spokesperson Harry Roque said that companies should offer shuttle services for the safety of their employees.

While the BPO industry has taken a hit during the pandemic, it is expected to bounce back sooner than other sectors, according to a survey conducted by property consulting firm KMC Savills. The report showed that the BPO sector would likely benefit from multinational corporations’ drive for cost-savings, similar to what was seen during the global financial crisis of 2008-2009. Similar predictions of countercyclical demand were made for Cebu City’s Business Process Management (BPM) industry, in a research paper released this month by property consultancy firm Santos Knight Frank.

Moody’s Investor Services, the credit rating agency, last week projected the Philippines’ Gross Domestic Product (GDP) to contract 2.5% this year – the first full-year economic contraction since 1998. In spite of this, Moody’s is still expecting the Philippines’ real GDP growth to “remain robust relative to peers.” The country’s BPO industry has played a part in that resilience as the sector this week announced $26.3 billion revenue for 2019, or a 7.1% jump from the previous year. According to the IT and Business Process Association of the Philippines (IBPAP), a considerable number of new investors and locators setting up operations in the country contributed to last year’s growth.

Acting Socioeconomic Planning Secretary Karl Chua also believes that the Philippines would remain as an attractive destination for BPOs post-pandemic due to competitive wages and a mature BPO sector. In fact, the local healthcare outsourcing sector is seeing a “new type of growth” post-pandemic. The Healthcare Information Management Association of the Philippines (HIMAP) President Roger Salazar Jr. further supported this view, announcing that the group’s 70 members are seeing a “new type of growth” post-pandemic and expecting a net 10 to 15 per cent growth. To stay on top of the growth, the sector is planning to boost automation systems and further their technological tools.

GET 3 FREE QUOTES: 700+ BPO SUPPLIERS
LEARN MORE

The Indian BPO sector is also showing similar economic resilience. Global technology firm Quess Corp. expects that companies will expand their existing Indian operations due to the ‘proven expertise’ of the industry during the COVID-19 lockdown. However, some IT-BPO companies in the country have either stopped hiring or are deferring hires as a result of the COVID disruption. According to Pavanjit Mane, president of the Forum of IT Employees (FITE), there could be thousands of employees impacted across hundreds of companies.

In response to the growing anti-China-COVID sentiment, the United States government is making plans to transfer their China-based factories to Indonesia. Senator and Chairwoman of the Senate Committee on Economic Affairs Imee Marcos said that this confirms a growing economic trend of Western countries favoring Southeast Asian countries as alternative sites to manufacturing.

A recent report has illustrated the impact of COVID-19 on people’s mental health – especially that of BPO workers. According to the Philippine Mental Health Association (PMHA), 60 per cent of their callers seeking mental health assistance are from the BPO industry. PMHA psychologist Lorraine Jessica Baclig said that mental health problems can be amplified under the conditions of the pandemic since lockdowns limit social interaction, mobility and a source of income which often triggers depression.

In other mental-health updates, on May 8, Facebook agreed to pay $52 million to current and former outsourced content moderators to compensate them for mental health issues developed on the job. “We are grateful to the people who do this important work to make Facebook a safe environment for everyone… We’re committed to providing them additional support through this settlement and in the future.” Facebook said in a statement.

LivePerson’s Rob Locascio said in a CNBC TV interview, that COVID-19 may have ushered in “the death of the call center”. The CEO of the $2.4bn automation company said that increasing adoption of digital communication software is increasing pressure on call center operations around the world. This view was supported by a recent Zacks Outsourcing Industry study, predicting that the adoption and wider application of Artificial Intelligence (AI) will be the biggest industry change due to the pandemic. AI is expected to lower complications and simplify operations and is anticipated to aid the industry as the majority of employees work from home.

A recent Wall Street Journal article warned that callers around the world may be in for a unique experience when they call their bank, utility company or big corporate.  The WSJ explains that due to the largely Filipino-based call center staff having to work from home, Western callers report hearing roosters, pigs, cows, and other pets in the background of their customer service calls. The call centers have taken steps to “rooster-proof” their operations by providing noise-cancelling headsets, while some offices have provided accommodations near the office to avoid unnecessary noise and distractions.

 

GET THE COMPLETE TOOLKIT - FREE
LEARN MORE

Wednesday, May 20, 2020

NEWS THIS WEEK

 

19 May 2020

  • Current crisis results to busier times at call centers – read article…
  • Philippines still an attractive BPO destination despite COVID-19 – Chua – read article…
  • Cebu’s BPM industry may benefit from global recession due to outsourcing – read article…
  • Healthcare outsourcing sector sees a “new type of growth” post-pandemic – read article…

18 May 2020

  • Employees in modified ECQ areas struggle to get to work on their first day back after two months – read article…
  • BPO industry reports $26.3 billion revenue for 2019 – read article…
  • Transfer of China-based US companies to Indonesia an edge to SEA outsourcing industry, says senator – read article…
  • Majority of callers seeking mental health assistance are from BPO industry – PMHA – read article…
  • Japanese Firm Seeking BPO Investment – read article…

15 May 2020

  • ‘Politicizing’ of the BPO industry a cause for concern, says DFNN – read article…
  • COVID-19 ‘to impact’ BPO revenue – read article…
  • BPO companies hold off on-boarding due to pandemic – read article…
  • BPO industry predicted to bounce back two to three months after pandemic – read article…
  • Roosters and other pets chime in customer service calls as agents work from home – read article…

14 May 2020

  • BPOs are taking advantage of low real estate prices, says property consultancy firm – read article…
  • Government releases MECQ guidelines – read article…
  • Globe employees volunteer as customer service reps during pandemic – read article…
  • Facebook settles a $52 million payout for moderators who developed PTSD on the job – read article…

13 May 2020

  • COVID-19 pandemic has ushered in ‘the death of the call center,’ says LivePerson CEO – read article…
  • AI expected to save ‘gloomy’ outsourcing industry during COVID-19 crisis – read article…
  • Tourism industry turns to BPOs to survive business – read article…
  • Quess CEO predicts global tech firms will expand in India – read article…
  • Real estate investment is “still a good idea” amidst the pandemic – read article…
  • PH economy expected to contract 2.5% in 2020 – read article…

12 May 2020

Related outsourcing resources

    Exploring outsourcing? See how we can help you
    EXPLORE NOW
    X
    Transform your business
    Icon
    CONSULT
    Icon
    3 QUOTES
    Icon
    START
    Icon
    FAST-TRACK
    Icon
    TOOLKIT
    X
    Shares