It’s no secret that business process outsourcing has been surging forward in recent years, passing some impressive milestones along the way. What is surprising, however, is the pace of this growth. The BPO market is repeatedly accelerating beyond the expectations and predictions of even the most optimistic industry commentators.
The global BPO market is a dynamic and varied one, so it can be difficult to put an exact dollar value on how much this is worth. However, the market was commonly valued at around US$92.5 billion in 2019 —the year before the global pandemic.
Business Process Outsourcing Remained Strong During the Pandemic Phase
While other industries were ravaged by the effects of this pandemic, BPO was not — in fact, the nature of outsourcing administration and other tasks meant the industry became a lifeline for lots of different groups during the worst of the COVID-19 period.
This included Western businesses struggling to connect with affordable and high-quality services, as well as workers in traditional BPO hotspots such as Southeast Asia and Eastern Europe.
As a result of this reliance on BPO, the market grew significantly over the COVID-19 period. Estimates suggest the market was valued between US$232 billion and US$245 billion by 2021, as increasing numbers of businesses and organisations grew to rely on BPO as a way to thrive even during difficult and tumultuous times.
Figures from the beginning of 2022 suggest that growth will continue at a faster rate than previously anticipated. A 6.63% compound annual growth rate (CAGR) had been suggested between 2022 and 2027, but this has been revised to a CAGR of more than 8.5% as the global market is expected to hit an astonishing US$620 billion by 2032. Things really are looking bright for the global BPO market.
One of the most important nations for business process outsourcing and remote staffing is the Philippines. The Southeast Asian country is proving to be one of the key sources of positive energy in the global market.
We’ve examined this in previous articles, looking at factors such as a highly-skilled, well-educated and supremely motivated workforce, as well as reduced labour costs compared to Western Europe, North America and Australasia.
These aspects have helped the Philippines achieve a formidable BPO market, but what other factors are fuelling growth and development in 2022 and beyond?
Diverse IT Capabilities
One of the key benefits of outsourcing to the Philippines is connecting not just with talented IT teams but also with specific services across a diverse array of IT fields.
For instance, Filipino BPO firms are experiencing growth in fields such as Big Data and Analytics (BDA), Internet of Things-enabled devices and the data these devices provide, Artificial Intelligence (AI) and Machine Learning (ML), automated processes and software, and cloud computing structures.
These aspects are all critical to IT success for modern businesses, so they are all in high demand. The Philippines’ ability to meet this demand is proving valuable as BPO firms in the Southeast Asian nation become leaders in the global BPO market.
Healthcare and Digital Entertainment Surging Forward
The IT market is certainly not the only area in which the Philippines is pushing the global BPO market forward. Increasing numbers of businesses — across a broad variety of markets — are waking up to the benefits of outsourcing, and the Philippines appears ready to meet those challenges.
The healthcare service delivery segment is one of these growing BPO sectors, and this is providing significant successes for outsourcing firms within the Philippines.
To illustrate the diversity of businesses seeking outsourcing opportunities, another key growth segment is the video game development industry — a world away from the healthcare services market.
The Philippines has been part of the game development landscape for many years, and software giant Ubisoft opened a studio in the country back in 2016. Today, Filipino BPO firms are increasing their market share in the outsourced development field.
Offshore and Nearshore Potential
The Philippines represents an offshore opportunity for businesses in North America and Western Europe. For these businesses, nearshore outsourcing locations are found within the Central and South American markets, or within Eastern Europe, respectively.
However, the Philippines does offer nearshore opportunities for other organisations, namely those in Australia and New Zealand.
Businesses in Western Australia are in the same timezone as the Philippines, while those in Adelaide and Sydney are only 1.5 and 2 hours ahead, respectively. New Zealand, on the other hand, is four hours ahead, but this is still a workable time disparity.