The fast pace of today’s world demands a lot from companies. From start-ups to major players, companies are pressured to generate huge profits while reducing the cost of their operations without sacrificing quality and brand reputation.
Data processing tasks have been a huge burden to many companies as they take time away from more important job functions. Hence, many have turned to outsourcing as a solution.
Outsourcing is a business practice where certain portions of work are being completed by suppliers instead of within the company itself.
Small- and medium-scale enterprises often turn to outsourcing because they cannot afford to hire employees. Many known start-ups today became successful with the help of outsourcing. Skype built their business with the help of developers in Estonia. Klout, MYSQL, and Opera also used outsourced staff from different countries.
The United States is one of the major players of offshoring (outsourcing outside the country), with Britain coming in second. The United States alone accounts for over 70 percent of offshoring business. Big companies are considerably open to moving services and jobs abroad, many of which involve the transfer of call centers.
McKinsey & Company stated in a report that in theory, 11 percent of service employment could be performed remotely. The report also noted that by breaking down the functions and jobs that comprise the eight representative sectors of the global economy (i.e., auto, health care, insurance, IT services, retail, retail banking, packages software, and pharmaceuticals), an estimated 18.3 million jobs can be done by people anywhere in the world.
Moreover, Forbes listed five benefits of outsourcing aside from cost reduction:
To tap into global talent
To build partnerships that both enhance value and reduce risk
To seize new local market opportunities
To get to market faster and boost innovation
To disrupt traditional business models
Western companies are also encouraged to outsource to develop strong connections. Outsourcing is an easy way to build a network outside the home country.
Outsourcing firms mainly started out with low-skilled manufacturing jobs. The good news for many businesses is that now outsourcing goes beyond manufacturing. Businesses can also outsource more critical processes, such as data backup security, data processing, total facilities management, and internal audit, among others.
A good example is the medical industry. There is a growing demand for outsourcing medical transcription. With the Philippines’s immense pool of talented medical professionals like nurses, medical technologists, and specialized medical transcriptionists, the country has been able to meet the demands of U.S. hospitals, which are mandated by law to convert medical records into data format.
SPI Global senior vice president Rommel Reginio said that the Philippine BPO industry has already expanded to include customer retention, upselling, and consultative selling. The business has also grown to include finance, human resources, data analytics, and network engineering. This expansion of outsourcing beyond manufacturing became an opportunity for the Philippines to utilize its high literacy rate and English-speaking college graduates.
Outsourcing in the Philippines
The Philippines is one of the top destinations for companies looking to outsource. BPO giants such as Accenture and Convergys currently have more than thirty-five thousand employees each in the Philippines. According to World Bank estimates, by 2020, the Philippines is projected to generate $55 billion in this industry. In a report by CNN Philippines, the Philippine BPO industry does well in telecommunications, financial services, hospitality, and manufacturing.
The leading position of voice BPO services in the country is attributed to three factors, namely, American English accent, U.S. cultural affinity, and the hospitable nature of Filipinos.
Philippine statistics show lower staff turnover compared with other countries. India’s staff turnover, for example, is at 31 percent with staff tenure at only eleven months. The lower staff turnover and longer staff tenure situation in the Philippines is convenient for outsourcing. Lower staff turnover and longer staff tenure mean fewer problems when it comes to coordination with companies who avail outsourcing services.
The Philippines is ranked fourth among Asian nations in terms of labor quality, according to the U.S.-based META Group. The country is ranked first in the availability of knowledge-based jobs and workers. Overall, the quality of the workforce in the Philippines is higher than that of India. This can be attributed to the impressive 93.4 percent literacy rate of the Philippine workforce compared with India’s 61.0 percent, according to a report by the United Nations Development Programme.
In fact, American, European, and Australian companies that have already outsourced in the Philippines are saving 40 percent to 60 percent. The savings can be translated to a boost in profit and increased capital for expansion.
Benefits of Outsourcing Your Data Processing Needs in the Philippines
Here are only a few of the benefits companies can gain from outsourcing:
A major cut in operation costs— With outsourcing, companies save 15 percent on average. A 2014 Datamark Inc. study claims that a client saved 31 percent in a year because of outsourcing. In a separate survey by Black Book of Outsourcing, 53 percent of companies claimed that outsourcing is the main driving force of cost reduction.
Increased financial returns— A 2010 study from the University of Texas found that a company’s annual sales per employee can shoot up to 14.4 percent if its data usability increased by 10 percent. When information is made available and easier to understand because of data processing outsourcing, the company increases the usability of their data for the benefit of the company.
Improved efficiency and streamlined productivity— Companies can refocus their resources, time, and efforts to other aspects of their business while entrusting their data processing needs to external service providers. By outsourcing data processing services, companies save resources and time.
No staffing challenges and an English-speaking workforce— Data processing involves rigorous and tedious activities such as data collection, entry, and extraction. As such, a client should hire an external service provider or professional services company that can understand the language of their data.
Challenges of Outsourcing
As with any other transaction, the process of outsourcing also has challenges. For starters, you are entrusting data and possibly confidential information from your company to an external entity. Data breach is a security threat that needs to be avoided through additional precautions. Miscommunication or even lack of communication may also lead to delayed completion of projects or, worse, wrong outputs that may incur additional cost for the company.
Another challenge is Internet connectivity, particularly in the Philippines. In the Net Index report published by Internet broadband testing company Ookla, the average download speed in the country is 3.6 Mbps, way below the world average of 23.3 Mbps. Fortunately for the Philippines, the government has already taken steps to address the slow Internet connectivity.
Essentials of an Outsourcing Partner
To achieve a successful outsourcing partnership, a company should partner with a service provider with experience, professionalism, and expertise that can exceed the expectations of clients.
inWrite is a good example of a company that can offer those.
inWrite is a Danish-owned company based in the Philippines that began operations in 2005. inWrite provides services such as proofreading, copyediting, and writing. The company employs English-proficient Filipinos who can deliver promising results. Its team has already worked with authors, publishers, educators, organizations, and multinational companies from across the world. inWrite has clients from the United States, the United Kingdom, Denmark, France, Japan, and Australia, among others.
An efficient five-step workflow is observed in every project. From the client’s order until the client’s final approval, inWrite ensures that a strict quality assurance process is implemented to systematically check and countercheck the document before it is returned to the client.
In each step, the security and confidentiality of the client’s document is maintained. inWrite understands the importance of the client’s work and thus strives to maintain the integrity of the document.
From proofreading and editing to data processing services, inWrite provides the same high-quality work and dedication to clients’ projects.
To know more about inWrite’s services, go to www.inWrite.com.
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