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DFA raises RP profile as global supplier of BPO/ICT Outsourcing services
The profile of the Philippines as a supplier of business process outsourcing and ICT services in the global market was raised to a higher level as a Philippine ICT Outsourcing Mission visited New Delhi, Mumbai, Hyderabad, and Bangalore in India from 18 to 26 September 2006. Department of Foreign Affairs Undersecretary Edsel T. Custodio and Ambassador Benedicto Yujuico, Special Envoy of the President for Trade Relations, served respectively as Head and as Deputy Head of the 11-member Mission, which was mainly composed of BPO and ICT outsourcing executives in the Philippines. The Mission conducted high-level meetings with India’s National Association of Software Services Companies (NASSCOM) and other Indian ICT associations, encouraged India-based BPO and ICT companies to set up operations in the Philippines, as well as invited them to create strategic partnerships with Philippine companies, including forwarding of excess job orders to the Philippines. The Mission’s program of activities included Site Visits (Infosys, Tata Consultancy Services, Satyam, Wipro, Larsen & Toubro, Birla Transworks, GE Services, Color Chips, Worldtech, and MPhasis), Meetings (Hyderabad Software Exporters Association, and ICICI One Source), as well as Networking Receptions (NASSCOM-Hyderabad, Federation of Indian Exporters Organization, Confederation of Indian Industry, and International Crops Research Institute for the Semi-Arid Tropics). The meetings between the Mission and several Indian companies revealed that Indian companies are slowly recognizing the strategic value of establishing a presence in the Philippines due to the increasing demand of end clients of Indian companies for (1) non-IT professionals (accounting, finance, human resources, medical and legal) that are abundant in the Philippines, (2) Filipino voice-based services, particularly in front line operations such as call centers, and (3) established offshore disaster recovery and/or business continuity facilities to support India-based operations. The various Indian companies that the Mission visited have recognized the strategic value of the Philippines to their existing operations. WIPRO regards the Philippines as the ideal offshore site for the company’s disaster recovery and business continuity infrastructure. Larsen & Toubro has included the Philippines in its global service delivery network to support the multinational operations of Chevron. ICICI OneSource and GE Consumer Finance Services have conveyed their end clients’ insistence on services being provided by Filipino professionals. Color Chips recognizes the high productivity and quality of Filipino graphic artists. Transworks and Worldtech recognize Philippines as a more sustainable source of non-IT professionals, particularly in the medical, legal, accounting, finance and human resource areas. Indian companies are currently examining three approaches to enter the Philippines. The first approach is to invest directly into the Philippines with a wholly-owned subsidiary. This would mean access to the manpower base of the Philippines, hiring from a larger pool of non-IT professionals than what is available in India in order to augment their existing operations in India. Among the companies considering this approach are TransWorks, which is planning to set up an operation in Manila to handle finance and accounting work orders, and Worldtech, which is now encountering difficulties in ramping up its workforce due to a declining supply of qualified Indian medical transcriptionists. In the case of GE Consumer Finance Services, ICICI One Source and Larsen & Toubro, the desire to establish a Philippine subsidiary is driven by demand from end clients. WIPRO is considering this approach for the purpose of integrating satellite operations to service a disaster recovery and/or business continuity strategy for its end clients. The second approach is to acquire a Philippine company or partnering with one. This would mean the acquisition of unique competencies and technologies already developed by existing Philippine organizations. Color Chips is considering this approach as it has interests in project management processes for game development on a co-production basis. The third approach is to outsource to a Philippine service provider. This would mean taking advantage of the available service capacities in the Philippines that are comparable in quality and performance to that of Indian companies. Worldtech is also considering this approach with a view to forwarding excess medical transcription orders to the Philippines. One of the challenges to these approaches is the ability of the Indian businessmen to freely travel in and out of the Philippines. The Philippine government has promulgated in February 2006 guidelines that afford greater mobility to legitimate business persons wishing to conduct business in the country as well as fast-track the processing of pre-arranged employment and special non-immigrant visa applications filed by Indian nationals who are employed and hired by Philippine-based companies. Before these guidelines were promulgated, the process and procedure for the issuance of pre-arranged employment and special non-immigrant visas for Indians by any Philippine Embassy or Consulate are prone to delays on account of the transmission of relevant documents to and from the Bureau of Immigration, the Department of Foreign Affairs and the Philippine Embassy or Consulate. To effectively reduce this lengthy processing period, the guidelines promulgated in February 2006 instituted a fast-tracked procedure that allows all Philippine Embassies and Consulates to first issue a temporary visitor’s visa to a qualified Indian national and his family members, that could later be converted to the appropriate pre-arranged employment and special non-immigrant visas when the Indian national and his family members have already entered the Philippines. This procedure applies only to the following categories of Indian visa applicants: Indian nationals who have pending visa applications with the Bureau of Immigration (BI) and the Department of Justice (DOJ) for employment-related purposes, submitted by Philippine-based companies, including technicians, consultants, and professionals, and for which a visa category other than a temporary visitor’s visa must be secured by the concerned foreign national under pertinent laws to be able to fulfill the purpose of his/her stay in the Philippines; and Immediate family members of Indian nationals who fall under the preceding category. Indian nationals whose primary purpose of entry is to pursue trade and business activities that do not require a long-term stay in the Philippines (i.e. less than 6 months) shall continue to apply for the appropriate business visas and comply with prescribed standard requirements under existing visa rules and regulations. Dependents of these Indian nationals must apply for and comply with the prescribed requirements for temporary visitor’s visas for pleasure. For more information on these new guidelines and other visa categories, the public is encouraged to visit the website of the Philippine Embassy in New Delhi at www.philembassynewdelhi.com. The Mission helped forge closer ties between the private ICT companies in the Philippines and in India, which is the world’s leading exporter of ICT outsourcing services. It showed that the Philippines and India need not be mere competitors in the ICT Outsourcing market; they could also be strategic partners who together could enlarge their respective shares in the global outsourcing pie. The DFA is planning to build on the gains of the Mission by (1) promoting closer business-to-business relations through exchange of missions and cooperative participation in trade fairs and conferences; (2) reviewing the policy of the Philippines to liberalize visa for legitimate business travelers as well as dependents; (3) supporting the implementation of the MOU between the Business Processing Association of the Philippines (BPA/P) and NASSCOM; and (4) facilitating the signing of the proposed MOU between the province of Cebu and the Hyderabad Software Exporters Association. It is hoped that these initiatives would enhance Philippines-India partnership in outsourcing on a long-term basis. |
