MORE small and medium enterprises (SMEs) as well as new businesses are now increasingly open to outsourcing which can enhance their savings and business processes.
Juan Paolo Araneta, head of Prople’s business development and project management group, said that based on their clients’ experience, businesses that resort to outsourcing for their business processes save 15 to 20 percent in operational costs and experience “process improvements.”
Araneta said SMEs and new businesses are “more open” to outsourcing in some of their business processes and operations compared to large companies that do not approve of outsourcing right away because of the need for corporate deliberations and board approval.
He explained that businesses may be doing well in certain sectors they are in, but may not have the investments in proper infrastructure or efficiencies for business processes such as finance and accounting, and data management and storage.
In such situations, SMEs tend to tap outsourcing firms that have the technical knowhow and available infrastructure, which can result in 15 to 20 percent savings for these small businesses.
These SMEs also benefit from the technical industry knowledge that outsourcing firms provide, which will allow for “process improvements” such as work efficiency and reduction in the number of full time employees (FTEs) needed for a single project or task.
“Apart from profit, businesses pursue business stability—what they are good at and passionate about. The key here is that businesses should focus on the things they are good at and leave others to outsourcing,” Araneta said.
Mandaluyong-based Prople is engaged in providing value added business solutions to SMEs, new companies, and some large multinationals through outsourcing. These solutions include financial and accounting services, HR & payroll services, and data management services.
The Information Technology and Business Process Association of the Philippines (iBPAP) said it expects the Philippine business process outsourcing (BPO) industry to hit $25 billion in revenues and generate 1.3 million jobs by end-2016.
iBPAP attributes robust growth in the BPO sector to the expansion of services from voice to non-voice services, mainly in knowledge process outsourcing (KPO) and health information management (HIM).
Other segments that show solid growth are IT and engineering services, animation and gaming development, legal process outsourcing, and marketing services.
Other than Metro Manila, BPO companies have also expanded and located to provincial growth areas, mainly in the so-called top 10 next wave cities. These are: Baguio, Cagayan de Oro, Dagupan, Dasmariñas, Dumaguete, Lipa, Malolos, Naga, Sta. Rosa in Laguna and Taytay in Rizal.
“About 15 to 20 companies are inducted every month in iBPAP. A lot of companies are setting up shop in the Philippines. We are now the new hotspot of international countries in terms of non-voice BPO services,” Araneta said.