A majority of business process outsourcing firms in Metro Manila are projecting modest growth in 2009 despite the global economic downturn, an industry survey revealed Tuesday. 

The survey showed that 82 percent of Business Process Outsourcing (BPO) companies project positive growth. Of that number,  16 percent expect an increase in business by 51 percent to 100 percent while 33 percent expect to increase business by 11 percent to 50 percent.

On the other hand, 14 percent of the companies that participated in the survey said it expects no change in its business this year while four percent said it projects negative growth.

The survey interviewed a total of 158 human resource practitioners of various BPO firms including call centers, back offices and IT-related and software firms in the Makati, Ortigas/Pasig, Quezon City and Bonifacio areas with staff of over 500 employees. The survey was conducted by Outsource2Philippines last month. 

Premiere hub

Frank Holz, CEO of Outsource2Philippines, said most of the larger BPO companies that participated in the survey project positive growth this year. "With all the challenges of economic times, we would be OK if we grew 15 percent or higher this year," he said in a forum at the Ateneo Professional Schools in Rockwell, Makati City. 

Oscar Sañez, CEO of the Business Processing Association of the Philippines (BPAP), said he expects a higher rate of growth this year as many companies see the potential of the country as a premiere outsourcing hub.

"Are we downsizing? Are we looking at declining numbers? The answer is no. We are looking at another year of growth even after a full year of recession in the US. We are now seeing the market potential coming to light as the Philippine value proposition grows stronger," he said.

Hiring rate

The survey also showed that the hiring rate among BPOs remains low with 34 percent of companies saying that they hired five percent or less of the total number of applications they receive while another 34 percent said they hired five to 10 percent of the total number of applicants.

On the other hand, the survey showed a relatively low level of attrition with more than half of the companies reporting less than two percent attrition. "This means that there's been a major move in attrition rate as turnover seems to be manageable and acceptable," Holz said.

He said the survey showed a clear move to higher-value services while English competency and computer skills remain in high demand. 

Management talent

The survey also showed an increase in focus on soft skills (including leadership, teamwork, intiative and customer service) and tertiary training (critical thinking, analytics and problem solving). 

"Some companies are not satisfied with the soft skills that the people bring with them to the job. They are looking for proficient, competent and independent thinkers who can solve problems on their own," Holz said.

Dan Reyes, president of Sitel Philippines Corporation, said BPOs are also concerned about the dearth of management talent in the labor pool, which he said could affect the growth of the industry. He said that of the 400,000 directly employed in the BPO industry, about 10,000 are managers. 

"If we double those numbers, we need another 30,000 supervisors and another 10,000 managers. We appeal to the academic community to help us in training and educating new leaders to appreciate the BPO industry," he said. 

Focus on cost

Barry Marshall of JP Morgan said one way that the Philippines could challenge outsourcing leaders such as India and Vietnam is to focus less on labor arbitrage and more on cost efficiency. 

"At the end of the day, can we find opportunities for our staff to change the way we do business? Labor arbitrage will erode over time but the skills will still be there," he said. 

Dr. Vicente Fabella of Jose Rizal University, meanwhile, said the outsourcing industry could mimic the nursing industry in enticing more students to enrol in universities all over the country. 

“The nursing industry did not have a BPAP that was promoting the industry but universities all over the country were falling all over themselves in providing nursing courses to students. It was because the employment potential hit the parents. For the BPO industry, however, it's usually the graduates who are aware of the job opportunities,” he said.