(Photo : BPO Philippines: Still the Best Choice)

The business process outsourcing (BPO) industry in the Philippines has become the global powerhouse for contact centers. Despite a relatively modest start at the turn of the century, it had surpassed even India as a destination for call centers in less than 10 years. BPOs in the Philippines now contribute around 7% of the nation's GDP, employing well over a million Filipinos in over 800 companies, servicing customers from around the world.

The rise of BPO companies in the Philippines owes a lot to government policies. Keen to encourage investment, the government set up several special economic zones, offering foreign investors incentives and tax-breaks to set up businesses and create employment. Among the early adopters of this were call centers, but there are several factors that helped propel the BPO industry in the Philippines to its status as a world leader today.

One is an accident of history. The Philippines has long had an association with the West, first with Spain, then with America. The result has been that, despite its geography, the nation has a close cultural affinity with the West, from the education system to the movies people watch. This results in a population who don't just have a high level of English proficiency, they also understand US slang and idioms. Ralf Ellspermann, CEO of PITON-Global, a mid-sized BPO provider in the Philippines, said, "the high level of English is a huge advantage. The biggest cause of complaints about offshore outsourcing is communication difficulties caused by accents or misunderstanding, but industry-leading BPOs in the country hardly ever get those sorts of complaints."

BPOs in the Philippines are part of a mature sector, and with that comes a huge amount of experience and expertise. Those 800 companies are operating in competition, but not all serve the same sectors. As customer demands have become more sophisticated, so too has the offer of BPOs.

While a BPO in the Philippines might conjure images of regimented banks of agents on phones, many are more sophisticated. Frequently operating from custom-built facilities, specialist providers can offer the highest standards of security required to serve clients in the healthcare or finance sectors. The government has even reformed local regulatory standards to meet the stringent demands of Western states to ensure that BPO to the Philippines is a secure destination for customer data.

The outsourcing industry's beginnings owe a lot to the demand for lower prices. And this is an area where BPO vendors in the Philippines can offer significant value to its clients. The low cost of living in the Philippines means that labor costs are also low. Despite being an attractive career option for talented Filipinos, the overall cost to clients is lower. Using a BPO in the Philippines can be as low as half the price of in-house or onshore operations.

However, this saving does not mean sacrificing quality, Ellspermann says, "the educated population, high standards of English fluency, and experienced and specialist operators creates an unbeatable offer. We can not only provide big savings, but maintain, or even improve on the service quality our clients get from their in-house or onshore outsourced operations."

The Philippines has become a world leader in BPO. The combination of quality services and cost reductions make it the first choice for companies - from small businesses to multinationals - looking to ensure their customers get high-quality customer service without having to pay over the odds for it.