Philip Lew – How I started outsourcing in the Philippines
Last updated August 28, 2019
Phillip Lew is the co-founder of C9 digital and it’s been going since 2018. Phillip is a US guy based here in Manila, Philippines. He’s been outsourcing for many years prior to that and in this episode, he talks about his journey into outsourcing and the realization of how massive the industry is. He explored outsourcing both as an outsourcing supplier and also in terms of seeing it from a business opportunity perspective. So a really good conversation with Philip Lew. I really enjoyed it and learned a lot myself and I’m hoping that you will too.
Derek Gallimore: Welcome to the Outsource Accelerator podcast. This is a short format podcast where we explore business and outsourcing mastery. My name is Derek Gallimore and I am really excited to bring you the leading podcast in outsourcing.
Derek Gallimore: Hi and welcome to another episode of the Outsource Accelerator podcast. Today I am talking to Philip Lew of C9 digital. My name is Derek Gallimore and this is episode number 222 so Phillip Lew is the founder, co founder of C9 digital and it’s been going since 2018. He’s a US guy based here in Manila in the Philippines. But he’s been an outsourcing many more years prior to that. And in this episode he talks about his journey into outsourcing and the realization that outsourcing is, you know, really kind of a massive thing and much more than kind of the whole VA thing and I really relate to his journey. He explored outsourcing both in terms of an outsourcing supplier, but also in terms of seeing it from a business opportunity perspective. So a really good conversation with Philip Lew. I really enjoyed it and learned a lot myself and I’m hoping that you will too. If you want to know any more about this episode or go to the show notes, go to outsourceaccelerator.com/222 enjoy.
Derek Gallimore: Hi and welcome back everybody. Today I am joined by Phillip Lew who is one of the co founders of C9 digital, which is say outsourcing supplier here in empty polar, which is just, on the peripheries of Metro Manila. Hi Phillip. How are you?
Philip Lew: Good. How are you my friend?
Derek Gallimore: Absolutely fantastic. And thank you for your time and thanks for joining us. Philip, we crossed paths a couple of times now. The outsourcing community has suddenly small your based out there in Antipolo, your other cofounder is also American. Can you give us a brief introduction about you and how you found yourself in Antipolo?
Philip Lew: Yeah, that’s, I’m still trying to figure that last piece out. It’s been a very interesting journey. I’m rather counterintuitive, but I think that’s sort of the sweetness of life is that sometimes, the things that happen, you can’t perfectly plan, but then in hindsight, you realize how everything came together in such a fantastic way. So my story actually was I, when I first graduate university, I went to Boston University and I studied entrepreneurship and I was always passionate about starting a company, starting a business but for me, and I think a lot of people can connect with this I didn’t, I knew I wanted to do something. I just didn’t quite know what I wanted to do. AndI had actually spent some time in Costa Rica and I was doing a lot of meditation and mindfulness and it was actually at that moment in Costa Rica.
Philip Lew: I met a friend who became a future business partner of mine, in this person’s name was James Rick. And he was actually the CEO of a company called Global Sky and what was interesting about him was he had basically built his own business and he was a very successful entrepreneur. And, I had met him in Costa Rica doing these meditation, seminars. And when I asked him what he did, he said he did all sourcing it. And at that time I had no idea what outsourcing was. I, I understood the word, but in terms of connecting it to an industry and understanding the, intricacies and, the scope of what this industry actually entailed, I had absolutely no clue. And so, but I was curious. And so he invited me to the Philippines. And this was about five years ago, so this was in 2014 and I arrived in the Philippines.
Philip Lew: And that, what I was blown away by when I came to the Philippines was just how developed the outsourcing community was and how big the industry was. And I would literally see just mountains of just a call center workers. Working the streets, you know, at midnight, 1:00 AM going to lunch, taking their lunch breaks, and they had their call center badges. And it was a very colorful experience for me. And, and, and I was thinking to my, and I knew in that moment when I first came to the Philippines, I said, I said, I want it to do something in outsourcing. I believed in the growth of the industry. I believed in what the industry it was capable of doing, how, how, when outsourcing is applied, I think correctly, how it really empowers the individual, business owners too, to do something really remarkable and their businesses.
Philip Lew: So this was five years, five years ago, and my first dabble and outsourcing was, I was actually hired to do sales and to actually bring in clients and this was for my friend’s company at Global Sky. And so I had developed a reputation in the industry from taking, the, the customer service center that I had worked at. Like, Global Sky from a hundred seats to about a thousand seats. And we did that in less than two years. And I got a lot of experience during that process of meeting a lot of CEOS, a lot of business owners, a lot of customer service executives and other, managers who were sort of involved in this space and understanding what was important to them, what are they trying to accomplish and also what were they not aware of, what were the mistakes that they were making in the process. And, I did that for a little while and, after doing sales for a bit, I decided to, it was kind of time to branch off and company, so to be one step back, after doing sales like Global Sky, I was actually offered into position, which was funny enough, this was a position offered to me by one of my own clients. So this was a client that I had brought into the customer service industry. It was a company called Propel, which is the second largest makers of drones in the United States and the CEO of Propel, this is a man named Darren Matloff. He had basically hired me to actually set up a whole customer service infrastructure in house for their company. And at the same time I was hired as an executive in charge of their customer service for three countries as well as I opened up four offices sales offices for them around the world. So I had a unique opportunity. I’ve traveled throughout Europe and Asia, setting up customer service offices and setting up sales law offices and doing a lot of fun stuff. So, long story short, after doing Propel, I decided to join forces with some of my colleagues and we started a company called a C9 digital and that’s where I am today.
Derek Gallimore: Wow, that’s a, that’s a journey and there’s a lot to unpack there. I want to go back to 2013 were you first introduced to this kind of concept of outsourcing? you had been through entrepreneurship,which, you know, a lot of us in a lot of the listeners, you know, and, and there’s now a big thing, you know, kind of 20 years ago, entrepreneurship was really a niche where everyone is now kind of worshiping at the altar of entrepreneurship. One of the big influences in that is Tim Ferriss, of course, the four hour work week, the which popularized the kind of freelancer and VA’s. Were you aware of that kind of aspect of outsourcing and initially way back in 2013, is that kind of what you perceived as outsourcing?
Philip Lew: Yeah. You know, it’s actually, it’s actually interesting. I remember reading Tim Ferriss’s book while I was in Costa Rica and I remember sitting on the beach, I’m listening to the sounds of the waves and the, and the beautiful white sand and the sunset. And I had my, my iPhone in my, in my, headset and I was listening to this concept of the four hour work week and on a very intuitive, visceral level. Everything he said made a lot of sense to me. And I said, you know what, this is definitely an approach to not only business but an approach to life. That makes a lot of sense and, and, and you could really sort of ascertain from some of the ideas in that book of what outsourcing is ultimately about. You know, I’m, I look at, you know, I had always looked at it and especially after reading that book, I began to look at outsourcing as a way to, to liberate one and to achieve certain things that would normally be impossible by by creating leverage for yourself and for your business. So, yeah, totally.
Derek Gallimore: And how, when you then visited the Philippines, what, what was the contrast between what you expected? Because you know, I’m on a bit of a mission to tell people that kind of VA’s and not work of fine, but, but you can take it so much further with professional services of outsourcing. And there’s quite a, you know, the, the, this, they’re almost worlds apart. The sort of project based work you get done on upwork for five bucks versus the kind of professionalized services where you know, you’re building a team of a thousand people when you came to the Philippines, kind of what was your experience when, when you were standing on the street and you saw everyone out you know, on their lunch break at 3:00 AM and you saw that this wasn’t kind of a few people doing some freelance work, but it’s actually an industry if, you know, a million or 2 million people what were your feelings about it?
Philip Lew: Yeah. You know, I think when I first came to the Philippines, my, my first impression was, wow, this is, this industry is much larger than I could have ever possibly imagine prior to come to the Philippines. Because you’re right, actually when it, the mental picture in my mind was, you know, just, you know, call center offices with agents basically, you know, on their lap, on their computer terminals. Maybe a little depressed, just kind of, yeah.
Derek Gallimore: Work in bit of a sweatshop. Yeah,
Philip Lew: yeah, yeah, exactly. And it wasn’t until I actually started going into offices and meeting with teams and management teams and team leaders and subject matter experts that I started to actually notice. I think there, there’s two insights I had. This was literally within the first six months of being in the Philippines. The first insight I had was that the industry is incredibly diverse. And what I mean by that is not just diverse in terms of industries and sculpts of work because you have all kinds of outsourcing, everything from you know, IT outsourcing to knowledge, outsourcing to a consulting outsourcing, to, you know, such a huge scope of the types of processes that one can outsource and, and, and, and, and how to go about doing that. So it was the diversity of the industry that struck me. And then the second thing was just how different companies are.
Philip Lew: And there are some companies that are very organized and that were very professional and they had the infrastructure, the resources, and I said to myself, wow, you know, this is the kind of company that I would want to either work for or work with or partner with. And then there were a lot of companies that I wasn’t very impressed with. And I think a lot of it is, at the time was just the, the, the monster is growth of the industry. So you have so many people who are looking to enter into outsourcing. They’re looking to do something with outsourcing. So again, the diversity of, of, of what outsource team is capable of doing and just the kinds of people and their backgrounds and their experience levels. We’re also very, unique as well.
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Derek Gallimore: Yeah. Yeah. It you know, we encourage, and unfortunately, you know, not enough people do, but we encourage people to come to the Philippines because it’s just the difference between night and day in terms of kind of conceptualizing the thing and seeing the full potential of what outsourcing can do for your business. Now, and as you say, I think people then realize the broader scope and potential. So many people still think that outsourcing is call centers or outsourcing is a part time VA but really, you know, it’s kind of, you can build entire corporate structures here, for kind of like 30% of the cost and, and, you know, with as good a qualified people, you know.
Philip Lew: Yeah, exactly. And, you know, and to your point about, you know, like upwork and versus a managed solution, you know, as a, as someone, you know, who else sources myself. I can tell you I actually use both, both services and I, and I think in large measure, understanding one of the, one of the most important things that you want to do is to really actually understand what you need and what you’re trying to accomplish. Because to me, when you get clear on what you want and what you’re trying to do, then that provides a lot of the necessary insights into what is the right strategy, what it and what is the right method to actually outsource properly. Because, that was actually one of the things I noticed too when I first came to the Philippines and I was meeting with, a lot of different kinds of individuals who were, who had come to the city for the purpose of outsourcing was a lot of them thought they knew what they want it, but, but when it came down to further, investigation and, in question going back with questions and, and learning and diving deeper into their businesses, it actually turned out that, a little bit more strategy was necessary in order for them to really understand what was the appropriate, thing that they should be doing, in order to outsource correctly.
Derek Gallimore: Yeah, I completely agree. And I don’t want to complete your brighttalk, upwork and freelancer, but, you’re absolutely right. There’s, there’s kind of like a, a range of tools out there and you know, you pick and choose, it’s a little bit like a buffet. And of course, if you want to get a logo done, then you’re not going to hire someone full time for that so you’re absolutely right. And you know, I think as well as you met these people, it’s, this, there’s a big learning curve without sourcing isn’t there. And you know, even after you’ve been doing it a one, two, three, five years, they’re still learning and there’s still kind of evolution, because it’s ultimately just employment and its operations and, and that can always be refined and tweaked and, and it evolves doesn’t it? It’s kind of like a living organism. And this is also why I tell people that the, that the partnership you have with your BPO, with your outsourcing supplier, it really is a partnership. And the truth, so census, it’s, it’s almost more like a marriage because you’re really kind of sharing the operational burden and obligations of the business. Yeah.
Philip Lew: Yeah. And that’s exactly right. And, and to me, you know, to me, you know, one of the most powerful aspects of outsourcing is this idea of leverage and getting leveraged for yourself and gain leverage for your business and of course, driving down costs. But we also have to recognize that, you know, we live in a very competitive business landscape it’s, it’s sort of a double edged sword in a sense because week stay that number one, this is the most abundant time in human history in terms of business opportunities, in terms of entrepreneurial opportunities, in terms of bringing a business or a product or a service to market and you see all kinds of people who are now who have access to the global economy due to increasing internet speeds and decreasing costs for mobile devices. And this is all good.
Philip Lew: I think for the global economy, but with that being said, it puts a burden on businesses. It puts a burden on businesses because they have to, become more competitive in their pricing. They have to compete with consumers have more choices, there’s more transparency. So outsourcing now I think, has actually accelerated and it’s even more important than it was 10, 20, 30 years ago but with that being said, the communication I think between you and, and, and who you outsource with is so vital. And so important. And you know, out of every, I think every single relationship I’ve ever seen, whether it’s a relationship that I’ve personally, had from now sourcing standpoint or just ones that I’ve observed casually, I would say the one unifying theme that makes these outsourcing relationships successful is a combination of having the right talent and the right communication with the partner and, and those that communicate effectively and they have that level of trust and rapport. Those are the relationships that truly shine. And I think create those, those those favorable financial metrics for companies. And the ones that fail are often ones where either the trust and rapport wasn’t established at the beginning or the communication broke down over time and so those are always things that you want to watch out for.
Derek Gallimore: Yeah, absolutely. And it’s, you know, I think, there’s, there’s another popular book which, which you’ve maybe read, that you might, which, makes, a turnkey operation of a lot of things. And I think a lot of people can start outsourcing. I’m hoping that basically all of their operational issues, all of the operational friction, all of the, business difficulties they’re facing can actually be outsourced and they can basically just press a button, pay an invoice at the end of the month, and you know, have their business ticking along perfectly. And it’s never really liked that is it, you know, it’s the kind of, as you said, it’s the relationship, it’s the blend of figuring out the problems and kind of developing and empowering a team to work through those problems. And that’s why it’s a, it’s an ever evolving kind of relationship.
Philip Lew: Yeah, I think you’re absolutely right. You know, Michael Gerber, who was the author of the EMS, was that w was actually someone that I admired for, for quite some time. And I remember reading that book actually, when I was really young and, I remember thinking to myself, okay, biggest takeaway is, you know, who am I? Am I the entrepreneur? Am I the manager? Am I the technician? And I knew early on I was the entrepreneur and you know, to me knowing what, what is the core focus of your business? What, what is it because you know, Jack Dorsey, the CEO of Twitter says something that to me was, was really profound in an interview and they had asked them, you know, how do you stay focused running Twitter and running square and all these billion dollar companies? He said, you know, every single day I ask myself one question, what is the most important thing that I should be doing to take this business to the next level in order to move the dial on the, on, on, on the, on the needle, in order to actually make a measurable impact in my business?
Philip Lew: What is the one thing that I should be doing? And I focus 100% of my time on that and everything else I delegate. And to me, you know, we’re talking about outsourcing. It’s in word shore, off shore. Whether you’re in the states or you’re in the Philippines or anywhere in the world, every single time you delegate, any single time you, you, you, you have someone on your team support you and help you do your, you’re technically outsourcing. And I think what’s, what’s unique about the Philippines is, is you’re outsourcing to a place in the world that is, you know, very far away and so because of that, it, what it does is all the, you know, the, to me, the core fundamentals of what makes a business successful, good communication, good teams, understanding the strategy sharing and the strategy you know, all those kinds of fundamentals are important when you outsource or when you delegate. But what makes it unique as it becomes even more important because of the distance and because of the time zone, differences. So, you know, if, if you’re really good at delegation, you’re really good at communication inside your organization. It’s, it’s, it’s a question of how do you take that and marry it with another company in the Philippines that kind of shares that same mindset in that same perspective. And then if you can do that, then you can unlock some really incredible opportunities.
Derek Gallimore: Yeah. And it is, you know, BPO, we try and remind people of is business process outsourcing. And as you say, it’s about taking those processes, identifying the processes and then working together to make them more efficient. Now in that, that I suppose is in tune with the myth and, and those kinds of philosophies and that it’s kind of developing processes and making them more efficient and more automated. And so, you know, you, you have built a team of a thousand people. You’ve been down this journey quite a while now. When did you start, C9 digital? Exactly. And what I suppose in a really brief summary were kind of three of the key learnings that you, that you really found critical to, to sort of insuring high quality delivery.
Philip Lew: Yeah, it’s a great question. So I co founded C9 digital actually in 2018 those, it was the middle of 2018 so around June and the purpose of why we want it to create [inaudible] digital was because we actually had a lot of successful relationships that we have cultivated over the last few years. Even going back to my days of doing sales, that Global Sky. And I, I’ll have colleagues and friends that would message me and say, Hey, what are you up to? You know, what are you working on? Can you help me with this? Can you help me with that? And you know, we decided to really kind of pull our resources together. And my co founder, David Borden, who is from Wyoming, we’re, we’re both Americans. And, we had both been living in the Philippines for quite some time. And so, you know, we said to ourselves, you know, what, what are we passionate about?
Philip Lew: What do we love to do and what do we have the ability to execute well on? And what we realized, was it was call centers services. It was digital marketing and so these were sort of the two areas that we really wanted to do something together. And so we had co founded C9 digital and I think, you know, as far as, you know, what are the three things that that come to mind, you know, having done this in terms of getting a good result? I think the first and most important insight I’ve had is to really, inquire, when, when working with a potential client in terms of what do they really want, why did they think they want that? And how does that add to the overall strategy of their organization? Because sometimes I think, when people have an idea of outsourcing, they’ll, you know, they’re very quick to contact of a few companies and, and get some quotes and they just want to go ahead and move forward and do something.
Philip Lew: But sometimes taking a step back and having this mindfulness of, okay, know, let’s talk about what is your company, what, what is this overall mission? What is this overall goal? What makes your company different? And more importantly, you know, how does this outsourcing relationship as strategic value to your company and you know, what and what are the major things that we can do together to, to really give and really create that world class result? Because I think if you really understand that together at the very beginning than it lays the foundation in terms of developing, whether it’s workflows or business processes or, deliverables and KPIs that are going to help you get there. So I think number one is clarity. And then I think number two is it’s super important to invest as heavily in your human resources and your recruitment capabilities as is in your marketing or your sales or anything else as far as your business.
Philip Lew: And so, I think, you know, one of the differentiators with, I think the great bpos versus the good bpos is I think the great bpos have great talent. And what I found is, you know, it’s really easy to assume that, what makes a great talent come to your organization is a more money. What I’ve also found is that it’s also about creating a great culture. So one of, one of the insights we’ve had at C9 digital is how important it is to create a culture that rewards excellence and that pushes people to excel. So we invest very heavily in mind sciences and Personal Development and coaching and and self education and, and pushing people to constantly increase their body of knowledge and I think that when it really, when it really comes down to it, BPO, especially if we’re talking about the outsourcing of labor, is really what we’re talking about is talent and an access to great talent.
Philip Lew: And so, I again, I can’t underscore how important that is. And I think to your other point, you asked, you know, you know, what’s kind of, you know, what’s the difference between that $5 an hour versus that $10 an hour kind of BPO center and I would actually go back to talent again because what I have found is that generally speaking, you know, one of the great things about outsourcing is a cost reduction but you want to find that sweet spot between cost and quality. And that really comes down to talent. So generally speaking, what I, what I’ve found is, you know, when it comes to picking a good center is you don’t want to pick, you definitely don’t want to pick the cheapest, vendor out there. You may not want to pick the most expensive, but you do want to find the ones that have that world class talent in generally speaking.
Philip Lew: When you talk to a company, and they’re a little bit more pricier than you might’ve expected, that’s usually because embedded into that pricing structure are the necessary margins for that mid, mid level leadership for the team leaders for the quality assurance specialist for the kinds of, for the kinds of exhilaration services that are necessary to produce a great result. And so again, you know, the great thing about outsourcing is cost saving, but you just want to be mindful of, of getting that world class talent. So, yeah. Yeah. And then the last thing I would say, the, the third insight I’ve had, in terms of getting real good result too is you have to know what you’re good at and yet you have to know what you can execute on. And so sometimes, you know, if you are really eager to, to work with, to work with the client, it’s, that’s great.
Philip Lew: But it’s also important to know your strengths, know your weaknesses. And there’s been many times I can’t tell you how many times I’ve had businesses reach out to us through our website or, or to do my own network. And they’ve said, hey, can you do this? Can you do that for us? We’re really trying to accomplish something. And I have come back and said, you know what, I think your idea is great. It’s not really what I do, but I can help you find someone that I think would be, would be the good fit. So, sometimes, it is, in other words, I think it’s important to find an organization that that really can execute well and what your, what your business is specific plea trying to accomplish.
Derek Gallimore: Absolutely. I try and remind people not to try and save every penny. You know, if they’re coming over to the Philippines and they’re saving 70%, then they need to take that as a win and not necessarily, you know, kind of scrimp and save so that they save 71% or 72%, because it might be a dollar cheaper. But then there’s, there’s obviously a lot of intangibles as the quality. There’s the output that people really can’t so easily measure and I caution people against, you know, just just looking at the price because as you say, like bpos are really good bpos, good outsourcing partners. They’re almost like a management consultancy thrown in because they’re helping develop the processes and operations. And so the things, so much for your insight, if people want to get in touch with you and I want to get you back as well so that we can actually really deep dive into C9 digital and specifically where it and what it does but in the meantime, if people want to learn more or get in touch with you, how can they do that?
Derek Gallimore: Fantastic. That’s great. Thanks for that.
Derek Gallimore: That was Philip Lew of C9 digital. If you want to get in touch with Philip or know any more about this episode, go to our show notes, which is an outsource accelerated.com/two to two. And as always, if you want to drop some email, ask us anything, then just email [email protected] see you next time.