MANILA, Philippines — The information technology and business process management (IT-BPM) sector posted a double-digit growth in revenue last year, mainly driven by pent-up demand from global customers and higher confidence for work-from-home (WFH) setups by clients.
Figures from the IT and Business Process Association of the Philippines (IBPAP) showed the industry recorded a 10.6 percent increase in revenue last year to $29.49 billion.
This also surpassed the $29.1 billion target the group earlier set for 2022.
Similarly, the group reported a 9.1 percent increase in full-time employees (FTEs) to 1.44 million, which also exceeds the 1.43 million employee headcount target for this year.
“This double-digit growth validates what we had projected – that 2021 performance was beyond recovery; it marks a resurgence for the Philippine IT-BPM sector,” said IBPAP president and CEO Jack Madrid.
“Preserving jobs, driving investments, stimulating countryside development, and creating demand for real
estate – these are the unequivocal contributions of the industry to nation-building,” he said.
IBPAP attributed the industry’s growth to three factors: pent-up demand from global customers, higher confidence in WFH setups by clients in contact centers and business process services, and growth in emerging sub-segments like e-commerce, fintech, healthcare and technology.
It added that more and more organizations in global business services (GBS) are also incorporating offshoring and outsourcing into their strategic initiatives to improve efficiencies and optimize costs in multiple geographies.
“This will spill over into 2022 and continue to boost demand for IT-BPM services across the world. We should not miss out on this opportunity to capture a bigger slice of the global market,” Madrid said.
IBPAP said that sustaining growth of the sector would be defined by several factors, stressing that further reliance on offshoring and outsourcing will be spurred by next-generation business models and assets, the talent and skills shortage, and competitive pricing models.
“Expansion across select horizontals and verticals and increased digital adoption by traditional players will also be key drivers of growth in 2022,”he said.
Meanwhile, the IBPAP identified three factors that industry stakeholders must carefully navigate to maximize the country’s growth potential and reinforce its global competitiveness in the year ahead.
“Supply chain resilience from a talent standpoint will be critical amid the intensifying talent war that’s exacerbated by higher attrition rates and growing requirements for emerging and niche skills such as automation, cloud, data and analytics, and cybersecurity,” it said.
It also stressed that integration of hybrid work models in business strategies would also become more prevalent.
The group pointed out that globally, 70 percent of IT-BPM enterprises are saying that they would be implementing hybrid work arrangements. Locally, 80 percent of Filipino IT-BPM employees have expressed their preference for a hybrid work model over returning fully onsite.
Moreover, it emphasized that location diversity has also become a priority in the aftermath of the pandemic.
“Given this, companies will need to leverage off alternative locations and adopt small-scale centers or microsites to achieve more robust business continuity plans (BCPs),”
IBPAP said.
The industry group said the future of the Philippine IT-BPM sector will be dependent on the country’s ability to take advantage of emerging trends and circumvent mounting threats on a global and local scale.
“A sustainable talent supply, predictable regulatory environment, and more enabling infrastructure are just some of the top considerations of potential investors and locators that the Philippines will have to nurture and support,” IBPAP said.
In line with this, IBPAP said it is set to publish the Philippine IT-BPM Industry Roadmap 2028 this year, which will serve as the blueprint for the sector’s priorities in digitization, talent, policy shaping, infrastructure, and country branding over the next six years.
“Foremost among these imperatives is legislation that will allow the long-term implementation of hybrid work given its rapid adoption in competing locations such as India, Poland and Malaysia. This has been a focus area of IBPAP in the last few years when it proved meritorious beyond its initial purpose as a BCP,” the group said.
Although recent efforts have been on facilitating a smoother transition back to the office through the extension of the WFH arrangement until Sept. 12, 2022, IBPAP said crucial work has been put into ensuring that the incoming administration understands why work-from-anywhere (WFX) is essential to the country’s enduring competitiveness and readiness for higher global market share.