Interview: Travis Coates

How can the Philippines further strengthen its attractiveness as a BPO destination?

TRAVIS COATES: The Philippines’ biggest competitive advantage is its English-language capabilities, especially its ability to serve the global English market. Filipinos also have an affinity for Western culture, which is why they’ve done so well supporting North American clients. Labour costs are also highly competitive. However, BPO in India also does well in English and operates at an even lower cost, so we must continue to improve our customer service through skills and technological advancements, and data analytics. As has been the case for the past decade, multinational organisations are becoming increasingly interested in local BPO services. That being said, it is critical for domestic BPO to deliver higher levels of value-added services, especially over Latin American countries, which are often closer and in similar time zones to most Fortune 500 companies. Many large, third-party BPO firms are hedging their investments by offering services in various destinations.

As captive BPO operations are on the rise, what can third-party firms do to earn back market share?

COATES: Third-party BPO has a longer history in the market and an overall larger footprint, so the key to earning back market share is to use existing assets to retain talent. Third-party BPO firms are often much larger than captive ones and thus can scale by leveraging larger recruiting engines. Third-party operators can also be more flexible with staffing, making lateral movements across departments or adjusting production depending on demand. Being larger and having deeper roots allows these companies to offer more mobility and better leadership development opportunities.

Which new opportunities will emerge from artificial intelligence (AI) and automation advancements?

COATES: The larger impacts of AI and automation will only be realised in the longer term, but it is generally anticipated that more skilled labour will be required. Job responsibilities will be more complex and geared towards problem-solving and comprehending advanced analytics. This gradual transition places an onus not only on the industry to train employees better, but also on the public education system to continue producing competitive candidates. However, multiple studies show that voice will remain a vital channel, preferred by many consumers, especially those experiencing service issues. Because human interaction with simple tech transactions will diminish over time, each human interaction will have to be that much more impactful to build a competitive advantage. For example, there is an increasing push for big data analytics to measure customer sentiment. Customer satisfaction data already exists, but the industry is now focusing on metrics to The biggest risk is the threat to data privacy, particularly in BPO. While data privacy measures can be improved, the public and private sectors are making progress, and the fact that the Data Privacy Act of 2012 shares many similarities with the EU’s General Data Privacy Regulation is a good indication of this.

What potential for growth exists in emerging cities?

COATES: Many BPO firms have been expanding into emerging cities to save costs and expand their recruiting pools. That said, we cannot abandon the major metro locations like Manila and Cebu, as not all clients want their offices outside of these areas due to convenience. Many clients want to be able to fly into Manila or Cebu and go directly to their office or hotel. If the government wants to push growth in emerging cities, infrastructure is a great first step, but these cities will also need international airports with flights from major areas like Hong Kong and Singapore. Many provincial locations including Cagayan de Oro, Davao and Baguio have just as strong a talent pool as Manila and Cebu, which incentivises BPO operators to expand there.