IT-BPM: Gearing up to sustain global leadership

MANILA, Philippines - The Philippine information technology – business process management (IT-BPM) industry is shaping up to sustain its global leadership amid threat from other countries led by China.

Jose Mari Mercado, president and chief executive officer of the Information Technology and Business Process Association of the Philippines (IBPAP), said in a statement that the country’s IT-BPM industry is carefully monitoring the sector’s global transformation.

Mercado said the IT-BPM industry has unleashed a wave of transformation across the globe, enabling several developing economies to emerge as viable, if not strong contenders.

 â€œThe Philippine IT-BPM industry is taking its transformative role seriously,” he stressed.

In 2012, the industry generated revenues of $13.2 million from voice and non-voice segments and employed 777,000 across the country. The industry road map targets overall revenue of $25 billion by 2016.

 â€œPart of our role is to manage our industry’s potential so that it brings progress to everyone. Because talent is what makes our industry world-class, we are committed to developing our employees as professionals and as individuals,” he stressed.

Recognizing the industry’s employment-generation potential, the Philippine government has identified IT-BPM among sectors with a crucial role in poverty reduction and inclusive growth.

He said IBPAP aims to train a talent base of 1.1 million over the next four years through industry public-private partnerships.

 â€œThroughout IBPAP’s existence, we have focused on developing the country’s capabilities so that we can employ more Filipinos and enable them to build a bright future without leaving the country,” he explained.

In Asia, the Philippines and India remain the top performers in the voice and non-voice sectors, respectively.

IT-BPM is now the “highest impact” sector for India, accounting for eight percent of gross domestic product (GDP), up to 25 percent of exports, and 52 percent of the global sourcing market. The industry is ranked fourth in India’s share of total foreign direct investment (FDI).

Although the Philippines and India have had a dominant share of the market, Mercado said China is also picking up steam.

In the Top 100 Outsourcing Destinations report by Tholons, cities such as Shanghai, Beijing, Shenzhen, and Dalian ranked 11, 12, 14, and 15, respectively.

There are efforts to improve the quality of education in the country, and the Chinese government is investing in infrastructure and increasing the number of English-speakers in the talent pool.

These issues and opportunities will be at the forefront of the 5th International Outsourcing Summit (IOS) with a theme of “Unlocking New Possibilities, Creating New Vistas” starting Oct. 6.

Flourishing economies and niche players in Asia, Europe, Middle East and Africa, among others, will be invited to present their success stories and industry trends and analyze the ways forward.

Countries such as Sri Lanka and Nigeria are also making their bid as IT-BPM hubs.

World Bank data show that Sri Lanka is rising in the ranks of middle-income countries, maintaining at least 5 percent growth even during three decades of conflict. The poverty rate improved from 15 percent in 2006-2007 to nine percent in 2009-2010.

SLASSCOM, Sri Lanka’s IT-BPO Knowledge Services industry chamber, expects export revenue to increase by 182 percent to $600 million this year from $213 million in 2007.

 The chamber reports that the number of companies would reach 220 this year from 170 in 2007 and employment reaching 67,000 from 33,000.

Nigeria is similarly keen on its showcasing its potential in Africa and the rest of the world. Even with economic gains, 62.6 percent or roughly 100 million Nigerians still live on less than $1 a day.

The Institute of Software Practitioners of Nigeria (ISPON) views software outsourcing as a strategy to address massive unemployment and “brain drain”. It believes that Nigeria could generate “over $100 billion if software outsourcing is fully tapped and harnessed.”

Nigerian overseas workers bring in $20 billion into the economy, which the industry hopes can be reversed by strengthening the IT outsourcing industry.