The Philippines has a two-decades-long history of call center outsourcing and is widely regarded as the world’s largest and leading call center outsourcing destination. As one of the country’s major dollar earners, the industry employs 1.2 million Filipinos and generates more than US$26 billion in annual revenues, which is equivalent to 7.4 percent of the country’s gross domestic product. Today, there are more than 800 contact centers operating in the Philippines.
Why companies are choosing to outsource to the Philippines
With operations expanding through the years, companies all over the world saw fit to outsource their contact center requirements to third-party call center outsourcing providers in the Philippines. Some have even set up their own captive operations in the country, including Amazon, JP Morgan Chase & Co., Facebook, Google, and United Health Group. This is because labor cost in the country is significantly lower, or about 60 percent lower compared to rates in the US.
High English proficiency?
Aside from the low labor cost, companies are getting the best deal because Filipinos are known to speak excellent English. The American colonization beginning 1898 up to 1946 left a big mark in the country. Specifically, the Philippines’ close cultural affinity to the US is clear until today: signs in the English language, late-night news, movies, etc.
With a high literacy rate of 94 percent, Filipinos—approximately 60 million are working—are clearly topnotch in the labor pool.
But are their English language skills really top-notch?
Proficiency does not only refer to speaking the language but also the person’s capability to listen and comprehend. If you don’t understand what the customer is saying, then you are bound for trouble. Most often than not, the disconnect is the root cause of the majority of complaints and low customer satisfaction levels in call centers in the Philippines.
In the US, it doesn’t matter if your call center is located in Atlanta or in Dallas. Provided that call centers employ native speakers who were born and raised in the country, the English language proficiency of the agents is about the same.
In the Philippines, however, the English language proficiency of call center agents can vary from A+ to F.
Filipinos speak more than one language
Although the large majority of Filipinos can speak and understand English, that doesn’t mean they are native speakers or fluent in the language. A large majority of the population speaks English, but for most, it’s more like a second language than a first. For many, Tagalog remains to be the first language of choice, especially in the nation’s capital.
With a population of more than 100 million, the Philippines is also home to more than 170 languages, including Ilocano, Cebuano, Kapampangan, etc. The government also recently introduced changes to the basic education curriculum of school children, including the introduction of mother tongue-based multilingual style of teaching. Understandably, the diction also varies from province to province, especially for an archipelago that comprises 7,641 islands.
The level of education in the country also varies—but is most often dependent on the economic class of the families or where in the country Filipinos grew up (Metro Manila or in the province). The social environment—again dictated by economic classes—also largely influences the communication skills of Filipinos. As such, Filipino agents have varying skills in the English language.
Co-CEO & CCO
Are you looking for an onshore, nearhsore, or offshore outsourcing solution? Don't know where to start? I am always happy to help.
Success in outsourcing isn't a matter of chance, but rather the result of a meticulously defined process, a formula that Fortune 500 companies have diligently honed over time. This rigor is a significant factor in the rarity of failures within these industry titans' outsourced programs.
Having spent over two decades partnering with and delivering Business Process Outsourcing (BPO) solutions to Fortune 500 clients, John possesses an in-depth understanding of this intricate process. His comprehensive approach incorporates an exhaustive assessment of outsourcing requirements, precise vendor sourcing, and a robust program management strategy.