Top Outsourcing Destinations in the World

Outsourcing is synonymous to business expansion.

When a business aims to make it to the top of the food chain, outsourcing is one of the best ways to do so. A perfect example of that is in 1923, General Motor’s CEO Alfred Sloan Jr. used outsourcing to improve the business.

Sloan, Jr. management style is cooperation with different individuals, specialized units, each with different functions, and was responsible for different segment production. Resulting to that, they managed to get 43% of the car market share even against the giant Ford Motor Company.  

A business not already outsourcing is like missing one of the biggest innovations of the human workforce.

For instance, when Ford Motor Company car market share was reduced to 10%, they exhausted all methodologies and realized that outsourcing can help them bounce back. True enough, Ford enjoyed its benefit even up to this day. 

While anyone can hire outsource services, it’s a challenge to find a reliable and proven BPO company as everyone claims to be ‘the best’ or ‘the top’. 

In this article, we have specifically identified several qualifications of top outsourcing destinations to help you make an informed decision based on the output and result you need. So read further below! 

Best Countries to Outsource

Let’s be real. There are a lot of outsourcing companies in the world. Countries are competing to maximize this huge potential to provide quality jobs to its people through outsourcing.

Whether by hiring highly skilled employees to provide top-notch customer services, IT support like troubleshooting of client’s common problems, to offering a wide variety of services like BPO, LPO, KPO, and even Healthcare. 

Countries compete daily to make its mark in the global outsourcing market. This transforms the landscape into a highly competitive business. 

Top outsourcing destinations all share the following factors: talent, skills and quality of the workforce, business catalyst, cost and infrastructure, risk and quality of life, and digital and innovations refer to the open innovation ecosystem and adaptation of digital technologies in the business model. 

1. Philippines

Outsourcing in the Philippines is the lifeblood of the country. 

Filipinos have neutral accents and the ability to adapt to different accents depending on their assigned region or country.

Among the top countries that outsource include the United States, Australia, and the United Kingdom.

On top of their natural-sounding accent and diction, Filipinos are mostly known for their customer-centric approach. Furthermore, the workforce is composed of well-educated individuals graduated from thousands of HEIs and universities in the country.

This provides a stable hiring pool of quality individuals which BPO companies can utilize to deliver quality results to the clients.

Adding to that is that the Philippines was dubbed as the World’s BPO Capital as the country has proven its competency when it comes to providing quality services.

Proving the huge market share of outsourcing in the Philippines is that it accounted for the $26 Billion contribution in the country’s GDP in 2019 alone. 

Outsourcing to the Philippines is proven to be effective and efficient as over 1000 firms provide top notch services to Fortune 500 companies and to small and medium startup companies. 

Competitiveness Level: During the COVID-19 Pandemic, the national government implemented local lockdown and this has affected most of the BPO companies located in Metro Manila.

The sector still thrives in spite of the challenges brought by the lockdowns. On the contrary, most outsourcing companies found new opportunities to provide customer satisfaction even at the work from home setup. 

Workforce Efficiency: Unemployment was among the worst effects of the pandemic. Even so, the Philippine outsourcing managed to keep things up and running. The industry once again proved its power as a top contributor in the local economy.

Adding to that, Everest Group study found that 64% of businesses are projecting to increase their outsourcing in the Philippines. Furthermore, in Tholons Report 2020, Manila is ranked 4th in the Top 100 Super Cities and top 6th in the Top 50 Digital Nations. 

Literacy Rate: UNESCO indicated that the Philippines has youth literacy rate of as much as 99.1% 

Global Literacy Rate: In English Proficiency, the country is among the Top 20 in global rankings and Top 2 in Asia

2. India

The country’s top selling point is its talent pool specialized in IT and software development. Per Tholons Services Globalization Country Index 2020, this country ranked 1st in the Top 50 Digital Nations and it boasts the full support of the government to fully utilize the IT industry. Many well-known companies such as Microsoft, Ford, and American Express outsource some of their services in this country.

Competitiveness Level: The BPO sector in India faced serious challenges due to the pandemic. Major hindrance is the insufficient bandwidth connectivity to support the work from home setup of employees, especially in rural areas.

Although this may be true, experts claim that India still enjoys the trust of big businesses for its outsourcing needs and is expected to recover by 2021. 

Workforce Efficiency: India has commendable IT infrastructure and employees highly skilled in IT support and software development. Over 500 companies in India offer outsourcing services to 66 countries. They have about 1.1 Million people working in the BPO sector.

Literacy Rate: According to UNESCO, the country has 91.7% literacy rate.

Global Literacy Rate: In English Proficiency, India was 35th out of the Top 100 in world rankings and 5th out of 25 countries in Asia. 

3. United States

This country usually outsources and not the other way around. The US is now an emerging key player in providing outsourcing services. In fact, they are popular on tech-support and IT-related services.

The US landed on the top 2 in the Top 50 Digital Nations for 2020 of Tholons Report.

Competitiveness Level: US provides the top-of-the-line technologies and customer support. Plus its proximity to businesses that avails outsourcing services makes it a top choice.

However, they have the highest corporate income tax compared to other countries that offer quality outsourcing solutions which may be quite a hindrance for most businesses. 

Workforce Efficiency: The US government is changing the business landscape by supporting the outsourcing business through pulling back jobs to the country to increase its employment rate. 

Literacy Rate: There is no significant change since the UNESCO 2015 report and the US still enjoys 99% literacy rate

4. Brazil

The signing of the Outsourcing Law in 2017 made the country fully utilize the beauty of outsourcing. As a result of this law, it has made outsourcing more accessible. In effect, Brazil proved its competency in IT-support and was even dubbed as an alternative to India. 

Competitiveness Level: The BPO services of the country earned a total revenue of $4.9 Billion in 2018. BBC even considered them as a rising economic power in Central America due to their growing market share. 

Workforce Efficiency: Economic reforms and better policy is being implemented in the hopes of utilizing the full potential of outsourcing. As a matter of fact, tons of opportunities are opening to improve the service and labor force in the country.

Literacy Rate: Brazil has 99.2% literacy rate as of latest data

Global Literacy Rate: 59th in world rankings and 12th in Latin America

A Top-notch Outsourcing Service Provider

The Philippines is enjoying its huge chunk of shares in the global outsourcing industry. This ensures its top place in the yearly world rankings of the go-to country to outsource. 

Outsourcing in the Philippines is known for its excellent services in customer support, technical assistance, and BPO services. 

Global business leaders such as Google, Amazon, Canva, Citi, Wyndham Destinations, AT&T, and many more outsource their business processes to the Philippines.

Why Outsource to the Philippines?

Businesses based in the United States, Australia, United Kingdom, and New Zealand prefer to outsource in the Philippines to boost their performance due to the following reasons:

*Cost-effective Labor Force

Full tech-support, 24/7 customer service, or IT-related troubleshooting? Outsourcing companies in the Philippines can deliver without a hassle and at a low cost.

With the country’s affordable labor force compared to other countries, its workforce is filled with highly skilled individuals that can compete in the global arena in the outsourcing industry. 

*Technical Infrastructure  

With global innovation in terms of technological advancement, the Philippines is not last in the race as outsourcing companies are all ready to roll-out the latest technologies with the goal of helping businesses grow.

*Cultural Compatibility

The country being colonized by Spain and the United States for hundred years resulted in the affinity of the western culture. The country is also a healthy mix of the South Eastern and Western culture.

This enables Filipinos to reach their full potential to deliver expected results set by the clients.

*Progressive and Solid Government Support

Though the Philippines is once considered as a late bloomer in the outsourcing industry, it proved itself as one of the game changer and the government was quick enough to utilize its full potential.

This was made clear by providing ladderized education related to the information and communications technology through TESDA. 

An attached agency of DTI called the Philippine Economic Zone Authority (PEZA) provides incentives to BPO companies. These are fiscal incentives such as VAT zero-rating of local purchases of goods and services, Income Tax Holiday (ITH) for up to six years, and etc. While for non-fiscal incentives, this includes perks extended to foreign investors and their families.  

Outsourcing to One of the Top Call Center Countries—Philippines

The Philippines has rooted itself as one of the best and a major destination for outsourcing solutions. To demonstrate, Magellan Solutions with its 14 years in the outsourcing industry has served small to medium enterprises to major players from US, Europe, Australia, and New Zealand. In most cases, they outsource contact center services, software development, and other back office tasks.

Why did they choose the Philippines out of all the top outsourcing countries and what are the services they outsourced? Check this list of companies that outsource to Philippines:

• Slack – This application has been launched in the year 2013 by four talented people. But before the official launching of the product, they relied first on an outsourced design firm for the beta testing of the application’s copy and design. This smart move allowed them to gather essential feedback which later helped them to create a tool and give it a unique personality.

• Citi – Citi is one of the many US companies that outsource in the Philippines. As a leading global bank, Citi has been outsourcing its tech operations since 1992. Along with Poland and India, the Philippines also provides IT-related services to this financial giant. Citi’s operations in the country — within the firm’s operations and under the BPO setup — can be attributed  to the Philippines’ “sound macroeconomic fundamentals and skilled workforce.”

• AT&T – AT&T is one of the biggest outsourcers in the Philippines, employing thousands of Filipino workers. As a multinational telecommunications company, it subcontracts its customer service and technical support.

• Google – For years, Google has outsourced work to remote employees and saw wonderful benefits. The company outsources everything development, IT work, email support for AdWords, and virtual assistants. Aside from this, the company also does not discriminate on the people that they hire. In the year 2011, the company has more than 1 thousand representatives from sixty different countries that handle more than 10 thousand calls every week.
  

• AXA Insurance – A French multinational provider of insurance and various financial services, AXA outsourced to a Philippine-based BPO company to improve its learning program. Through outsourcing, they were able to decrease onboarding time and enhance the feedback of their trainees.

• Skype – Skype outsourced the back-end development of their application to three developers from Estonia. Eventually, the company brought in the developers as their partners. Skype originated in Denmark.

• WhatsApp – WhatsApp started as a small firm with around 35 employees. Nowadays, the application is now one of the world’s most popular chat apps. It eventually got sold to Facebook for $19 billion.

• Canva – Today, the Manila team has over 60 employees specializing in graphic designing, customer support, accounting, and many more! The country manager of Canva Philippines mentioned that Filipino artists made 99% of the over 50,000 templates available on their site.

The COVID-19 pandemic posed new challenges in the outsourcing industry of the Philippines but it also opened new opportunities. Notably, it even highlighted the Filipino resiliency and efficiency in providing excellent outsourcing solutions to the world. 

Expect Philippine outsourcing to strive even harder despite the pandemic. Filipinos will continue to deliver results to growth-hunger businesses. Want to satiate that hunger? Contact Magellan Solutions. Now. 

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