The emerging demand for knowledge process outsourcing in the Philippines

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The emerging demand for knowledge process outsourcing in the Philippines
Shey Paurillo
by Shey Paurillo
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As the Philippines overtakes India in the voice segment of business process outsourcing or BPO, more companies continue to tap our BPO providers for the country’s enormous pool of college graduate English-speaking professionals and for a fraction of the cost in the industrialized English-speaking countries such as Australia, United States, United Kingdom and New Zealand. On the other hand, there has been an emerging trend in the demand for more value-added and non-voice services brought about by knowledge process outsourcing or KPO.

The KPO industry is largely eminent in Europe and India. According to reports, knowledge process outsourcing originated in India when the country increased its dominance in the technology sector in the 1980s. KPO gained its popularity in the early 2000s when multinational companies like General Electric established an offshore facilities for their captive research and analytics and third party knowledge services in countries with technical capabilities and expertise. Some of the central processes provided by KPO are market research, fraud analytics, equity research and investment banking, insurance and actuarial, engineering services, animation, web development, data integration, remote education, research and development, project management, medical transcription and legal processes.

According to TechNavio, a technology research and advisory company, the global KPO market is expected to grow at a composite yearly growth rate of 23.12% from 2013-2018. This is due to the demand from developed western countries such as the UK, US and other European nations where the accessibility to highly trained and specialized professionals is receding.

The Philippine IT-BPO Roadmap 2016 report by IBPAP expects an increase in the entry of higher value KPO services beginning 2014. Local BPO industry is exhibiting a shift in the kind of outsourced services from the usual call center to a more knowledge-intensive services in the fields of research, engineering, accounting and IT in the Philippines. Recent industry reports validate a drop to around 60% from 65% of voice services while the demand for engineering services and knowledge process outsourcing in the Philippines is expected to grow at about 20%.



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