The Outsourcing Week in Review: Wednesday, October 7, 2020

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The two leading global outsourcing destinations, Philippines and India, are joining forces to boost cooperation on telemedicine, health information management, software development, and IT solutions and online learning. At their 13th Joint Working Group on Trade and Investments (JWGTI), the countries’ representatives met and identified sectors where both countries aim to strengthen cooperation. The Department of Trade and Industry (DTI) also invited Indian players in the pharmaceutical industry to tap business opportunities in the Philippines, as the two countries target to strengthen cooperation.

The Philippine economy is on its way to go back to normal, according to the DTI. In a memorandum circular issued by the agency, they announced that the government will now allow 17 business sectors to resume full operations as part of the normalization effort. Trade secretary Ramon Lopez said that there was an increasing need “to provide stability for businesses, re-stimulate the economy amid the COVID-19 pandemic and address the growing number of joblessness, poverty and hunger incidence in the country.” However, healthcare professionals are doubtful about this decision, especially researchers from the University of the Philippines (UP) Octa Research team that monitors COVID-19 trends in the country. The team warned against the 100 per cent reopening of the economy “unless facilities can absolutely guarantee observance of the minimum health standards.”

The World Bank (WB) is seeing the Philippine’s Gross Domestic Product (GDP) shrinking by 6.9 per cent this year — the worst drop in 35 years. WB senior economist for the Philippines Rong Qian told an online press briefing that the GDP would revert to pre-pandemic levels by end-2021, a slower pace compared to neighboring countries such as Indonesia, where COVID-19 cases also remained elevated. The forecasts of the WB as well as most other banks and financial institutions were beyond the government’s projection of a 4.5-6.6 per cent full-year contraction.

For some good news, the Philippine healthcare information management industry is projected to grow between 7.3 and 10.8 per cent in revenues and 6.8 and 10.2 per cent in headcount from 2019 to 2022. This is according to Julian Valenzuela, vice president and chief operating officer of Visaya Knowledge Process Outsourcing Corp. The Philippine embassy in Washington quoted Valenzuela as saying the country offers a wide range of services including practice management, medical coding and quality audit, claims and payment management, clinical document improvement, telehealth, and clinical trials.

The Department of Labor and Employment (DOLE) projects that the country’s unemployment will ease to a rate of about 10 per cent at the end of the year. From 17.7-per cent unemployment in April, Labor Secretary Silvestre Bello III sees joblessness to taper off to 10.4 per cent in end-2020. Further, he cited a number of “resilient” jobs in the National Capital Region (NCR) that withstood the impact of the pandemic. In a statement, Bello said that online job postings for workers with skills in healthcare, logistics, information technology, business process management, education, and construction are rising.

However, a human resource expert said that the pandemic has given birth to new hiring trends. Q2 HR Solutions founder Trixie Whyte said that the oversupply in the labor market has prompted businesses to recalibrate hiring, as employers are looking for candidates with additional skills. She added that they observed a repurposing and redeployment of workers in certain industries hit by the pandemic. Whyte noted that industries that are facing an uncertain future are cautious and are putting recruitment activities on hold, like business process outsourcing (BPO).

The 2020 IMD World Digital Competitiveness Ranking found the Philippines falling two notches to 57th place out of 63 nations. The country also placed 62nd on both starting a business and communications technology, and 61st on enforcing contracts and internet bandwidth speed, all of which are sub-factors under technology. This is why the National Economic and Development Authority (NEDA) is pushing for digital transformation to catapult the country’s growth in the midst of the pandemic. According to NEDA undersecretary Rosemarie Edillon, digital transformation is one of the priorities of the Task Group on Recovery towards having a healthy and resilient Philippines. While putting in place digital infrastructure, she added there is a need to retool and reskill the labor force towards digital skills.

There really is a need to reskill the labor force, as most consumers still prefer talking to contact center agents over chatbots. According to the results of the recent survey conducted by BPO solutions provider Merchants, majority of its respondents prefer to communicate with a contact center agent either via email (68%) or by telephone (62%), rather than resolve a query through a chatbot (35%). While many people might start their query with a chatbot or digital platform, they most often end up seeking human interaction in order to resolve their query as quickly and effectively as possible, notes the survey.

Overseas, data analytics and consulting company GlobalData predicts that the Indian BPO market revenue will drop nine per cent to $7.9 billion in 2020 from $8.6 billion in 2019 due to disruptions caused by COVID-19. According to the firm’s Information and communications technology (ICT) decision-makers’ survey covering enterprises across the country, 44 per cent of respondents revealed that they would reduce their spending on BPO services in 2020 due to the COVID-19 outbreak.

“The uncertainty in the business environment in the aftermath of COVID-19 outbreak caused a considerable decline in enterprise revenues during the year, compelling businesses to take a conservative approach towards their outsourcing strategy,” said GlobalData’s technology analyst Sandeep Kolakotla.


Wednesday, September 30, 2020



6 October 2020

5 October 2020

  • PH shows sustained economic recovery – DOF – read article…
  • Pampanga COVID-19 cases rise as more Clark Freeport workers get infected – read article…
  • PH now pushing hard to reopen and rebuild economy – read article…

2 October 2020

1 October 2020

30 September 2020

Read more Inside Outsourcing Newsletters here:

  1. The Outsourcing Week in Review: September 30, 2020
  2. The Outsourcing Week in Review: October 14, 2020

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About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.