Philippines vs. India: The Call Centre Giants of the World

It has been years since the Philippines snatched the title of being the Call Centre Capital of the World from India. While India is still a close rival, it has lost a significant sum of call centre market share to the Philippines. From Filipinos’ neutral accent to their extensive knowledge of the western culture, it is not surprising why international companies prefer to work with Filipino agents. Between the two destinations, it is a wiser business move to outsource a call centre to the Philippines than to India.

But why?

Near-native English Proficiency

Accent is very vital when it comes to catering to English-speaking demographic. While Indian English is laced with a thick accent, most Filipino agents speak with a neutral accent. This makes them a lot easier to understand. Moreover, Filipinos possess an extensive English vocabulary. Because English is part of the curriculum as soon as they start school, you can be confident that they are heavily exposed to the language. They can carry business English conversations, sustain casual ones, and even understand culture-specific references.

Speaking of culture-specific references, customers will not have a problem with mutual intelligibility when it comes to slangs and idioms. As mentioned, most Filipinos have near-native proficiency of the language. Most customers say that they feel like they are talking to people who are raised in a western country because of their cultural affinity. Lastly, if customers carry a heavy accent, there is still a high chance that Filipinos will understand them. This is because of their solid exposure to western media. Aussie, British or South American accent? Not a problem!

On the other hand, a huge number of Indian call centre agents have a hard time understanding western customers, and vice versa. Aside from this, Indian English can be very different from standard English. There are strings of words and vocabulary which make sense to them, but can sound weird to English speakers (e.g. to pass out = to graduate).

Low-Cost Business Expenses

You’ve heard this a thousand times: Philippines offers quality labour with very economical costs – even cheaper than that in India. Although low-maintenance, you can be confident that the Filipino workforce offers expert pool of talents.

Aside from the wage, operational costs in the Philippines can be cut down to almost 50% compared to India, and 75% compared to the US. From construction, lease, utilities and permits, companies enjoy economic freedom when they choose to operate in the Philippines. Government incentives for BPO companies make call centre thrive even more in the Philippines.

With these benefits, it is clear to see why corporations choose Philippines as their call centre hub. Huge savings on operational costs? High-quality service? Low risk, high return? No sane businessman will turn down such a great deal. As the BPO industry continues to grow exponentially, call centres in the Philippines are set to go only bigger.

The Call Centre Outsourcing Industry in The Philippines

It’s well known (perhaps supported by the movies cliché) that customer service is an increasingly used branch of call centre outsourcing around the world, mostly in Asia. But have you ever wondered why this is so?

In fact, ask yourself, why is it increasingly common for U.S.-based companies to be betting on call centre outsourcing services to Asian BPOs, specifically the Philippines? Why the Philippines?

Well, to provide the clear reasons for this business trend, first you have to understand in depth why the Philippines is one of the ideal (if not the most) places to outsource services such as call centres, customer service, software development, engineering and process assistance involving telecommunications.

The Philippines, leading the call centre outsourcing industry like no one

The astronomical growth of the Asian nation in the call centre outsourcing market, which has led it to be seen by many large companies (such as T-Mobile, Wells Fargo, Amazon, among others) as a paradise for telecoms and opportunities to further boost business, has been occurring since the ’90s.

In 1995, the Philippine Congress passed the Special Economic Zones Act, which establishes the Philippine Economic Zones Authority. This law provided lower area requirements for developments and tax incentives, which consequently attracted foreign investors.

So the 21st century opened the doors for the expansion of a new market in the country, business process outsourcing (BPO).

Since 2000, the Philippines have been incorporating hundreds of thousands, even millions of jobs as foreign companies address customer service, sales tasks and other industry sub-sectors such as administrative offices, hardware and software assistance. 

The cases of multinationals such as Accenture Global Resource Center and American Express, companies that have joined the trend of setting up offices in the Asian country; have served as an example to understand the main purpose: globalization.

This is where the real reasons come up in why U.S. companies are moving their call centre services to the Philippines (which, if that were not enough, surpassed India in this market many years ago, according to IBM’s Global Locations Trend).

Why are U.S. companies outsourcing their contact centre to the Philippines?

In 2014, the Philippines reached an all-time high of employment in the BPO industry (over 930,000), positioning itself as one of the leaders and powers in Asia, as this growth has been supported by the Philippine government, through a BPO Development Plan as one of the highest priority areas.

One of the secrets, which is also presented as a solution for foreign companies that want to reduce the maintenance costs of domestic outsourcing, which involves infrastructure, market competition and the human resource (poor training, high employee turnover rates), is that the Philippines offers programs to foreign investors.

These programs include tax exemptions and simplified import/export procedures, as well as training for BPO applicants, which means assistance in a market that can be a huge expense.

However, although the costs of outsourcing business processes in contact centre paradises such as the Philippines are visibly lower, the main reason it’s a big business decision that, due to globalization, call centres and services are increasingly specialized in the markets they cover.

This means, first and foremost, greater breadth of communication, technological advances and, most importantly, an increase in efficient operations that really help customers with their problems. The Philippines offers personnel training far superior to that of many other territories, which goes beyond the technical knowledge and support to be a call centre operator, it also includes dealing with customers, qualification in the area of sales and advice.

Government support with development programs (increasingly modern and adapted to market needs), staff training, infrastructure and more profitable labour are some of the factors strongly considered by companies in the United States and abroad, which have the purpose of seeking a solution for their needs in telecoms.

The call centre outsourcing services in the Philippines, whether internal or external to the company, have to go hand in hand with economic and profitability aspects while remaining logistically functional.

Call Centre Philippines

A call centre handles almost all customer service problems in the UK. The services include credit card handling, appliances’ warranties, and flight cancellations, just to name a few. So companies commonly outsource a subdivision of their call centres to outside specialist countries. This has now become a business practice to contract out call centre services.
Companies outsource their call centres in order to save money and reduce costs. They consider it to be cost-effective, and that is why they do outsourcing in those countries where the cost of living is low. This is a smarter technique to pay their workers less. But to stay secured from any natural disaster, they need to make sure that they have strong telecommunication networks.
Why Should You Outsource your Call Centre to The Philippines?
There are three major reasons why you should outsource your call centres to the Philippines. These reasons are as follows:
• Reduce costs
• Handling by professionals
• Expert management of opportunities.
Many companies believe that outsourcing their call centres to the Philippines will lead to drastic effective results.
Reduce Costs:
To create a dedicated department with highly skilled professionals for telecommunication is extremely costly. For this, you need to ensure that you have all the high tech equipment in your telecommunication department to get the results more easily and efficiently. This will make the task easier to accomplish.
In big organizations, there are limited professionals at a particular time which result in the performance to be low at the peak time. Therefore, the amount paid will be unfair for the professionals as well as the company where the cost of living is high.
Therefore, call centre outsourcing to the Philippines is done to reduce the amounts to buy new equipment and software and, this will also decrease the cost of labour for the company. The company will be able to save money by reducing the major costs. The accumulated number of professional employees is also excessive.

Handling by Professionals:
The difference in performance level will be pretty clear when you have an in-house contract, and when outsourcing is done. There are more chances of having experts and professionals in the call centre industry of the Philippines. They will have better knowledge and high experience on how to communicate and deal with the customers. They will know all the techniques on how to retain and engage the customers. These experts will have updated and latest equipment and software to ensure a perfect and a brilliant customer experience.
Expert Management of Opportunities:
As call centres deal with a wide range of different customers, they are named as ‘Special service providers’. They need to make sure that they are always staying at the highest level on the curve. This then demands for opportunities and growth for skills development.
The major reasons that why Filipinos are required is that they come from a diverse cultural background since their workforce is mostly multicultural. They are then able to easily deal and satisfy different customers from almost all around the world. Secondly, they have fluency in speaking English, so they are able to serve the best customer services.