Preliminary Study For The Css Industry Icto 1 Merged

Preliminary Study for the
Corporate Services Segment

of the Information Technology
and Business Process Management
Industry
Research and editing by
George Francisco and Caesar Parlade
____________
Published in December 2013 by the
With the support of the

Commonly Used Terms and Acronyms
BOI Board of Investments, the lead agency under the Department of Trade and Industry
charged with the promotion of investments in the Philippines [www.boi.gov.ph]
BPO Business process outsourcing
BSP Bangko Sentral ng Pilipinas (Central Bank of the Philippines) [www.bsp.gov.ph]
CCAP Contact Center Association of the Philippines [www.ccaponline.org]
COSO Committee of Sponsoring Organizations of the Treadway Commission, a joint initiative

of the American Accounting Association, the American Institute of CPAs, and other
institutions providing thought leadership on critical aspects of organizational
governance, business ethics, internal control, enterprise risk management, fraud, and
financial reporting
CSS Corporate services segment, part of the IT-BPM Industry consisting principally of
finance and accounting, insurance, and human resource services
DOST Department of Science and Technology, the executive department of the Philippine
government responsible for the coordination of science and technology–related
projects in the Philippines and the formulation of science and technology policies and
projects [www.dost.gov.ph]
DOST-ICTO Information and Communications Technology Office, the lead agency under the DOST
tasked to promote the rapid development and improved global competitiveness of the
country’s ICT industry, including the IT-BPM industry [www.icto.dost.gov.ph]
EMEA Europe, the Middle East, and Africa
eTelecare eTelecare Global Solutions, now Stream International Global Solutions Philippines, Inc.
F&A Finance and accounting
FDI Foreign direct investment

GDP Gross domestic product
GIC Global in-house center (also known as a captive or shared services center)
HEI Higher education institution
HIMOAP Healthcare Information Management Outsourcing Association of the Philippines

[www.himoap.com]
IBM International Business Machines Corporation
IBPAP Information Technology and Business Process Association of the Philippines, formerly
Preliminary Study for the Corporate Services Segment 2

the Business Processing Association of the Philippines (BPAP), is the enabling
association for the IT-BPM and GIC (global in-house center) industry in the Philippines.
IBPAP is the one-stop information and advocacy gateway for the industry
[www.ibpap.org]
ICT Information and communications technology
IT-BPM Information technology and business process management
K to 12 Kindergarten and 12 years of basic education (six years of primary education, four of
junior high school, and two of senior high school); the revised Basic Education Program
of the Philippine Department of Education
KPO Knowledge process outsourcing: the outsourcing of core, information-related business

activities which require advanced analytical and technical skills and specialist expertise
LGU Local government unit
NCR National Capital Region of the Republic of the Philippines; also called Metro Manila
Near hire A good candidate for employment who requires additional training to meet industry
demand
NEDA National Economic and Development Authority: the Philippines’ economic

development and planning agency [ www.neda.gov.ph ]
Next Wave Emerging IT-BPM hubs in the Philippines based on talent supply, infrastructure,
Cities™ business environment, risk management, and cost
PFRS Philippine financial reporting standards
PEZA Fiscal incentives granted by the Philippine Economic Zone Authority (PEZA) to qualified
incentives registered enterprises. These include income-tax holidays, hiring of non-resident
foreign nationals, duty-free importation of capital equipment and raw materials, zero-
rated VAT of local purchases, and exemption from LGU taxes, and exemption from the
expanded withholding tax
PDP 2011– Philippine Development Plan 2011–2016 [http://devplan.neda.gov.ph/]

2016
PDS 2011– Philippine Digital Strategy 2011–2016: the Aquino Administration’s vision on how the
2016 Philippines can transform into a competitive force in the global digital economy
Road Map A strategy paper by Everest Global and Outsource2Philippines developed with IBPAP
2016 and commissioned by the Commission on ICT (forerunner of DOST-ICTO). The paper
identified employment and revenue targets for the Philippine IT-BPM industry for 2016
and interventions needed to achieve them. It called for strengthened collaboration
between the private and public sectors to achieve accelerated targets

ROHQ Law Republic Act 8756 providing tax incentives to regional operating headquarters (ROHQs)
setting up in the country
SAP Enterprise resource software to manage business operations and customer relations,
including accounting and controlling capabilities, financial reporting and business
intelligence. Also, the German company that develops and supplies the software
TESDA Technical Education and Skills Development Authority, the agency in charge of
providing technical and vocational skills training and development [www.tesda.gov.ph]
CSS workshop The culminating symposium and discussion group activity conducted for this study to
crystallize consensus on productive corporate initiatives and areas for meaningful
government- and private-sector collaboration

Table of Contents
Commonly Used Terms and Acronyms ____________________________________________ 2
Executive Summary ___________________________________________________________ 6
I. Introduction _____________________________________________________________ 8
II. Global Trends in Outsourcing and Offshoring __________________________________ 9
III. Public-Private Partnership in Developing the ICT industry _______________________ 14
IV. The IBPAP Programs _____________________________________________________ 21
V. The CSS Project: Survey and Focus Group Discussion Results _____________________ 28
VI. CSS Workshop Findings and Recommendations _______________________________ 34
VII. Conclusion _____________________________________________________________ 49
VIII. Appendix 1 – Survey, Focus Group Discussion and Workshop Participants __________ 54
IX. Appendix 2 – List of Figures ______________________________________________ 565
X. Appendix 3 – A Postscript Report to the Preliminary Study for the Corporate Services
Segment of the IT-BPM Industry ____________________________________________ 56
XI. Appendix 4 – About the Publishers __________________________________________ 60

Executive Summary
The Preliminary Study for the Corporate Services Segment (CSS) of the Information Technology and
Business Process Management (IT-BPM) Industry is part of the development of a broader information
and communications technology (ICT) strategy to sustainably increase the Philippines’ share of the non-
voice segment of the global sourcing industry. This project addresses the need to step up the value
chain, especially in the CSS, given the twin threats from the growing number of countries pursuing the
provision of offshore services and increasing protectionist pressure favoring nearshoring.
The Philippines is at the cusp of a demographic dividend. The available workforce (between the ages of
15 to 64 years) will soon constitute an overwhelming majority of the population. This should bode well
for the country’s IT-BPM industry as it aims to double its headcount by 2016 with 1.3 million jobs in
total. The need goes beyond just the supply of an adequate number of graduates. The IT-BPM industry,
in close partnership with the academe and the education agencies of the government, need to ensure
that the incoming workforce entrants are also trained in the right disciplines and in acquiring the
employability skills sought after by CSS firms.
The CSS largely mirrors the imperatives of the larger IT-BPM industry. The workshop participants echoed
the urgent need for a broad and sustainable education strategy that will assure large-scale improvement
in the quality of the talent pool. Although many companies acknowledge the efforts of the Department
of Science and Technology-Information and Communications Technology Office (DOST-ICTO) and the
Information Technology and Business Process Association of the Philippines (IBPAP) as well as their own
initiatives already in place, the clear consensus was that much needs to be done to integrate these
initiatives into real collaboration among government, the academe, and the industry so that the
necessary transformation in secondary, tertiary, and post-graduate education can be achieved.
The near unanimity and the urgency of the call for talent development underscore the gestation and the
scalability challenges of current industry programs on education. Clearly, stop-gap measures are
needed. A clear low-hanging fruit might be the expansion of IT-BPM training programs of the Technical
Education and Skills Development Authority (TESDA) to cover a much wider area where traditional
education has not kept pace with workplace requirements.
The final consensus was on the need for a better orchestrated national IT-BPM strategy. Many
participants admitted that they were not fully aware of some of the DOST-ICTO and IBPAP programs
until these were presented in the workshop. Although this clearly indicates the need to review and
improve the communications plan and program scorecards publication, the participants felt that there
were several key gaps, notably:
 The absence of a central industry information base, freely accessible to all potential
stakeholders—locators, investors, local government units, universities, students planning their
careers, recent graduates, parents, etc.

 Resources that will help in executing programs in the areas of the CSS, specifically in terms of
talent development, marketing, among others.
All told, the abundance of insightful observations in this study has managed to define not just the areas
of concern but also the elements and frontlines of strategy. A broad outline of a strategic framework to
serve as a solid foundation for the CSS road map exercise also emerged. This paper is meant to capture
all the insights from the participants in the project. It is hoped that these insights will mature into a
vision and strategy that will ensure the inevitability of the IT-BPM industry’s growth and also to spur
more active thought leadership and IT-BPM industry scholarship.

I. Introduction
Despite the global economic downturn, the Philippine economy is on the rise. With US$83.8 billion in
gross international reserves as of December 2012, and a series of credit rating upgrades expected to
lead to achieving investment-grade status, the Philippines even recently pledged US$1 billion to the
International Monetary Fund to help shore up the struggling economies of Europe.
The country’s gross domestic product (GDP) is expected to grow by at least 6.5% in 2012, the second
highest in Asia and next only to China. The services sector, which includes the information technology
and business process management (IT-BPM) industry, contributes 54.8% of the country's total GDP. In
2010, the service sector employed 52% of the total workforce. The IT-BPM industry is an important
driver of growth directly and indirectly of services and is projected to continue driving employment and
economic growth under the Philippine Development Plan 2011–2016.
The Preliminary Study for the Corporate Services Segment (CSS) of the IT-BPM Industry was undertaken
recognizing that the IT-BPM sector is composed of diverse segments that in themselves may require
distinct growth strategies and differing levels of government support. The study is an initial attempt at
this more nuanced and differentiated information and communications technology (ICT) strategy to
sustainably increase the Philippines’ share of the non-voice segment of the global sourcing industry. This
project specifically addresses the need of the CSS of the IT-BPM Industry to step up the value chain,
given the twin threats from the growing number of countries pursuing the offshoring of IT-BPM and
increasing protectionist pressure favoring nearshoring.
In the context of a broader ICT strategy, this study is a crucial precursor for the development of a
strategic plan to make the Philippines the primary destination for CSS and was produced to achieve the
following objectives:
 identify the key stakeholders in the CSS of the IT-BPM industry in the Philippines
 identify the issues, challenges, and opportunities to develop and grow the CSS in the Philippine
IT- BPM industry
 identify strategic resources required to further the growth and to increase the Philippines’ share
of the CSS in the global IT-BPM industry
 develop a strategy framework that encompasses the above as well as formulates initial
recommendations for all concerned stakeholders
This study commenced with the conduct of a survey among CSS providers among IBPAP members,
specifically to identify issues and challenges in the CSS. These concerns were later validated through a
series of focus group discussions which were designed to probe deeper into the survey results. The
culminating activity was a workshop, held among the target participants of the study, which gathered
preliminary recommendations on programs and initiatives to address the issues. Finally, these collective
views and outcomes are incorporated in this groundwork study.

II. Global Trends in Outsourcing and Offshoring
As a jump-off point for discussion, some of the global trends that are affecting (and will continue to
affect) local outsourcing companies and global in-house centers (GICs) were presented:
 Maturing offshoring solutions

There is a growing and transforming global value chain that is increasing in complexity from
commoditized support activities to core services to knowledge work. The parts of the services
value chain that can be performed offshore has increased in value and complexity as we
continue to see new types of services being handled remotely and across borders.
 Clients are becoming more sophisticated, meticulous and demanding1

Companies that outsource are becoming more discerning as demonstrated by the following
recent trends:
o Companies are slower in closing large value contracts resulting in the levelling off of the
total value of large contracts. Total contract value of large contracts (i.e., annual
contract value of US$5 million or more is down 13% in the 1st half of 2012. The 3Q 2012
Global TPI Index is down 6% from 3Q 2011 and down 10% from 2Q 20122
o Legal disputes are rising despite some locations (notably China and India) being
nightmarish for litigation
o Some work that used to be outsourced is coming back in-house
o Fewer long-term deals are being closed.
 The weakest growth in offshoring continues to be in Europe

The prolonged recession in Europe will continue to dampen the demand from what was before
a major source of market growth for outsourcing companies. IT outsourcing from Western
Europe is expected to shrink by 2% and that experience is not atypical for many business
process outsourcing (BPO) verticals.3
 Broadening offshore delivery network and nearshoring

The geography of offshore delivery has spread out to include an ever increasing number of
countries, leading to intensified competition. In response to increasing competition in the global
market place, countries have started to specialize in different parts of the service production
ecosystem.
The creation of narrow niches of expertise, in turn, has also given new momentum to near-
shoring. Despite the media attention to nearshoring, it is easy to miss the competitive
1
The Trouble with Outsourcing, Schumpeter, The Economist, July 30, 2011,
http://www.economist.com/node/21524822?zid=292&ah=165a5788fdb0726c01b1374d8e1ea285
2
Outsourcing Market Posts Second-Best Third Quarter On Record, Information Services Group, http://www.isg-one.com/web/media-center/press/121016-US.asp
3
Western European IT outsourcing to shrink by 2% – Gartner, Information Age, August 7, 2012.http://www.information-age.com/channels/it-services/perspectives-
and-trends/2115118/western-european-it-outsourcing-to-shrink-by-2-gartner.thtml

imperative because, if we take the individual country view, there are very few countries that can
match the talent pool size in China, India, and the Philippines. To appreciate the intensity of
competition in the new paradigm, the correct view is to look at nearshoring clusters. East
European countries in close proximity and clustered between the Baltic Sea and the Black Sea
(Estonia, Ukraine, Latvia, Lithuania, Belarus, Moldova, and Bulgaria) are attracting a lot of the
high value IT work. These countries have a combined population of about 72.5 million—quite
comparable to the 2012 estimated Philippine population of 97 million. While this geographical
outsourcing market cluster still bears substantial operating cost disadvantages compared with
the Philippines, its proximity to the host countries in Western Europe (allowing for better
resource sharing) and the cultural affinity often more than makes up for operational
diseconomies. When viewed through the lens of nearshore clusters, it is no surprise that the
Philippines has mere 1% of the global IT market.
 New methods of control, Editors Notes

communication and guidance Is the Vertical BPO the Shape of Things to
Companies seeking to grow their Come?
outsourced functions have started to
realize that without organizing In the post-2007 world of banking and finance,
concerted networks that introduce regulations governing data gathering and reporting
new methods of control, standards have become increasingly complex. In
communication, and management, the US, the Dodd-Frank Act revised a wide swathe
problems with staff pipeline, of financial statutes and fundamentally altered the
outsourcing partnerships, and change scope of data collection and the manner of
management inevitably arise as early reporting.
as the process transition.4 Local
To keep pace with the changes in regulations
companies’ capability to collaborate affecting different operating jurisdictions, global
well will be an important
banks and financial institutions require the ability
differentiator mirroring the increasing to produce reports according to the requirements
sophistication of host companies in
of the different regulators. Unfortunately, many
managing their value chains. The
banks still have mainframe-based legacy systems.
challenge cannot be downplayed by
Significantly revised compliance regulations and
thinking that Philippine firms will be
reporting requirements have the potential to push
naturally more collaborative given
these systems to the breaking point.
that Filipino culture is by nature much
less individualistic and more In this evolving regulatory environment and
relationship driven than the Western unburdened by legacy systems, a BPO with deep
cultures. Collaboration skills domain knowledge and integrated industry-
encompass both know-how as well as specific tools and processes can extract the data
behavior and attitudes requiring both and produce the required compliance reports
training and experience. requisite reports at a fraction of the cost and time.
4
Outsourcing: The Rise of Fragmentation, Ernst & Young, 2008. http://www.cel-logistica.org/upload/2008%20E&Young%20European_outsourcing_survey_.pdf

Editors Notes
The Importance of Business Domain Modeling
一圖勝萬言
One picture, the Chinese proverb goes, is worth ten thousand words. In no case is this more valid
than in Business Domain Modeling. The use of the Universal Modeling Language allows every
business activity and concept to be expressed in a reasonably language faire graphic form.
Business Domain Modeling is a key functional competency associated with IT business analysts.
The role of the business analyst is to capture business requirements for IT solutions in order that
customer needs can be met, consistent with a firm’s objectives and strategy. The business analyst
role requires marginal IT applications development expertise but demands excellent
communications skills in soliciting and documenting the needs of the business users. It is
acknowledged that many IT projects fail because of the failure of analysts to accurately translate
business needs for the benefit of the IT programmers.
For BPOs, the power of such a tool is immediately apparent. Interrelated processes can be
expressed in more readily understood graphics to give a holistic view of the business. Employing
domain modelling improves the BPO’s ability to document processes accurately and shorten
process migration lead times. Landed processes that are related or similar can be more easily
integrated or aligned.
There exists a Business Analysis Body of Knowledge and there are at least two certifications
associated with it: Certified Business Analysis Professional (CBAP) and the Certification of
Competency in Business Analysis (CCBA). If the industry promotes these certifications to aspiring
local business analysts, the benefits can be two-fold:
 The ability of local BPO companies, particularly those in the CSS, for change management
will improve considerably
 More IT services work can be outsourced to the country
Against this backdrop of global trends and developments, the workshop participants raised the following
key points which will be revisited later.
WORKSHOP DISCUSSIONS ON GLOBAL OUTSOURCING TRENDS
 The labor force as consumers

China is viewed as a formidable competitor in the outsourcing industry with an insurmountable
advantage in being an oversize market for consumer products. Hence, offshoring serves a dual
purpose by providing companies a foot in the door into the Chinese market. The same could be
said of India’s domestic market. Could the Philippines capitalize on the back of its healthy
consumer sector attract outsourcing contracts from global retail and consumer companies?

 Partnering with other outsourcing centers
The growth of new centers for outsourcing could also be an opportunity for the Philippine
companies to act as sub-contractors or partners to firms in these new hubs and vice versa. The
Brazilian government, as a notable example, pushed its financial services companies to
outsource technology infrastructure early on. As a result, more than 70% of a billion-dollar BPO
industry is in IT services. There might be opportunities for the comparatively immature local IT
services industry to partner with Brazilian firms, seeing that there would be very little
competition between our two countries. Would there be similar opportunities with Russian and
Eastern European firms as well?
A real live example of an outsource partnership in document services between an Indian and a
Philippine firm (with documents being shuttled back and forth between the two countries) was
recounted by a participant.
The sentiment expressed was that there is need of an overall strategy for such collaborative
partnerships to flourish.
 Moving up the value chain

There should be an explicit strategy to move up the value chain. China and Russia both
appeared to have a cultural bias toward high technology and research and development, quite
apart from plain production and, as such, leapfrogged rapidly into the knowledge process
outsourcing (KPO) space. India’s was a more deliberate climb up the value chain into KPO
services and which at times appeared to be driven largely by competitive pressures.
 Selling niche services

Only China and India have the ability and labor pool to compete in nearly every area. These
countries may not serve as useful benchmarks for the Philippines.
The relative disadvantage of the Philippines in distance and time zone is substantially offset by
the demographics of a steady supply of labor. Consulting firms such as Gartner do not fully
appreciate this and this only demonstrates the country’s challenges in marketing and branding.
If the Philippines will follow the lead of other countries in differentiating its services and in
promoting carefully selected competitive niches, the question would be how to decide, as a
country, which niches to promote? Would finance and accounting (F&A) services still be too
broad an area to be a meaningful competitive niche? Finally, there was mention of travel
services as a natural niche for the country.

Editors Notes
Legacy Insurance and Other Potential Niches
Some types of insurance have what are called long-tail liabilities because they remain liable for
potential claims well into the future, sometimes even after the premium payment period. Insurance
companies have to keep such policies, also called legacy insurance products, on their books and
need to keep servicing them, usually at a loss.
Traditionally, insurance companies solved this problem by selling their portfolio of legacy insurance
products but, of late, market prices and regulatory changes have restricted or prohibited such sales.
Outsourcing the servicing of legacy insurance policies to a low-cost service provider is the logical
solution to this problem.
Going forward, the high cost and shortage of onshore talent will motivate companies to
disaggregate complex jobs with the end in view of outsourcing tasks with lower risk profiles and
lower skills requirements to low-cost service providers, captive or otherwise.
According to Patrick David, from the global BPO and call center company, Coracall, which has global
operations across South Africa and the UK, “The [Philippine health-care outsourcing] industry has
matured considerably from initially delivering medical transcription services to now offering various
services, including clinical data management, disease management, revenue cycle management,
pharmacy benefits management, electronic medical records, medical claims recovery, patient
education, insurance processing, and quality assurance. The country’s health-care outsourcing
sector is expected to generate US$433 million in revenue and employ 43,000 by the end of 2012.”5
5
Healthcare Outsourcing Sees Sharp Growth in the Philippines, Free Press Release
http://www.free-press-release.com/news-healthcare-outsourcing-sees-sharp-growth-in-the-philippines-1353067871.html

III. Public-Private Partnership in Developing the ICT industry
POLICY FRAMEWORK
Recognizing that ICT plays a key role in the growth and development of the Philippine economy, the
Philippine Development Plan (PDP) 2011–20166 has identified the IT-BPM industry as a priority sector
with the highest growth potential.
A national policy framework for Industry and Services has been developed around three goals: to
improve business environment; increase productivity and efficiency; and, lastly, enhance consumer
welfare. Enabling industries and services to contribute significantly to economic growth and
employment requires addressing a number of constraints to their development. The government thus
intends to pursue strategies to raise the competitiveness by improving the business environment,
supporting productivity and efficiency initiatives, and inculcating the importance of ensuring high-
quality output among manufacturers and producers to produce goods and services that are comparable
with global brands.
The key role of ICT was also described in the Philippine Digital Strategy (PDS) 2011–2016.7 The PDS
describes the Aquino Administration’s vision on how the Philippines can transform into a competitive
force in the global digital economy. The PDS also laid down four strategic thrusts for the private sector
and the government to work as partners:
 transparent government and efficient services delivery
 internet access for the entire populace
 investments toward achieving widespread digital literacy
 ICT industry and business innovation for national development
Partnership efforts must be directed toward supporting programs that promote entrepreneurship, as
well as those that encourage companies to be more innovative and finally those that leverage the use of
ICT to improve their products, services, and exports while promoting employment. Realizing that
continuing innovation is core to the sustained global competitiveness of the country’s ICT industry, the
Department of Science and Technology-Information and Communications Technology Office (DOST-
ICTO) was tasked to serve as the lead implementing agency of the government in its ICT-related efforts,
particularly in thrusts such as ICT Industry Development, eGovernment, ICT policy development,
Internet for all, and Cybersecurity. The DOST-ICTO is tasked to formulate, recommend, and implement a
policy and program framework to promote the rapid development and improved global competitiveness
of our country’s ICT industry through research and development as well as through effective linkages to
6
The Philippine Development Plan 2011-2016, http://devplan.neda.gov.ph/
7
The Philippine Digital Strategy, http://www.icto.dost.gov.ph/index.php/philippine-digital-strategy

industry. Under the ICT industry development program of the DOST-ICTO, there is focus as well on the
development of the IT-BPM industry.
OVERVIEW OF THE IT-BPM INDUSTRY AND THE ORIGINS OF ITS PUBLIC-PRIVATE PARTNERSHIP
In 1994 the Philippine government adopted incentives for foreign investors to set up locally and employ
from the country’s plentiful and skilled labor force. Soon after, companies slowly started locating their
operations locally. By the period 2006–2012, the IT-BPM industry’s revenues and headcount were both
growing rapidly to the point that, today, the Philippines is recognized as one of the world's top IT and
BPM offshoring destinations. The Everest Group has reported that the Philippines is also among the
mature global locations for IT-BPM services (Figure 1 below). As of end 2012, IBPAP and its partner
associations have reported revenues amounting to some US$13.2 billion and direct employment
totalling about 777,000 staff.
Figure 1: The Philippines is a mature IT-BPM location

Currently, voice BPM still continues
to hold a large share of the global
offshore BPM market. However,
the non-voice BPM is gaining a
foothold as its depth and span
inexorably expands. Demand and
opportunities in the non-voce BPM
segment have shifted to more
complex and vertical-specific work.
The breadth of the services and
clientele of the non-voice BPM
now extend from banking and
financial services to insurance,
health care and media and even
engineering and creative services.
According to some industry analysts led by the Everest Group, the global offshore services market is
bound to continue to grow in double digits from 10 percent to 15 percent with a potential of translating
into a global IT-BPM industry that will double in revenues between 2011 and 2016 to as much as
US$250 billion. IT services as well as non-voice BPM will account for the lion’s share of the global
growth, the latter accounting for about half or US$122 billion.
The 2012–2016 Philippine IT-BPM Road Map published by the DOST-ICTO with IBPAP and TeamAsia
identifies key drivers for outsourcing to emerging economies within Asia Pacific. These include the
demand for new services such as social customer relationship management and mobile services for
customer management BPM, the capacity to scale operations, the prospect of infusing best-of-breed
processes and technology that will enable, among other things, faster time to market and improved
quality of administrative service to both internal and external clients. The road map further mentions

that cost and talent supply considerations continue to stand out amid the aforementioned drivers in the
global offshoring market. Finally, new and emerging geographies have sprouted specifically within
Europe, the Middle East, and Africa and vendors are proceeding to take advantage of heretofore
untapped talent, favorable business environments, and declining risk levels.
It is expected that the local IT-BPM industry will grow to US$25 billion in revenue and directly employ
around 1.3 million Filipinos by 2016. To achieve this, however, a number of conditions must be in place,
and programs must be implemented across the areas of talent development, industry capability,
marketing, and research, involving various stakeholders.
THE CSS AS ONE OF THE HIGH-GROWTH SEGMENTS OF THE IT-BPM INDUSTRY
The IT-BPM Road Map recognizes that global leadership in this industry requires that the non-voice BPM
segments must be enhanced even while the current supremacy in the voice BPM segment is sustained.
Further, the study recognizes that industry-specific services in banking and financial services, health
care, telecommunications, and utilities will drive market growth. The size and the quality of the
country’s pool of professionals as well as of graduates produced by the educational system in business-
related fields, medical and allied fields, social sciences, and engineering, among others, may provide an
avenue to expand into more complex, higher-value, and vertical-specific services (for example,
insurance claims processing, and credit underwriting).
The IT-BPM Road Map identifies the CSS (F&A, insurance, and human resource services) as an area of
growing global demand that the Philippines can exploit. This Preliminary Study on the CSS is one of the
projects that industry, through IBPAP and the DOST-ICTO, have undertaken to help determine the needs
of said segment as well as the opportunities for growth.
ONGOING PROGRAMS FOR THE IT-BPM INDUSTRY
Figure 2: The programs of the DOST-ICTO for the IT-BPM industry

TM
Figure 3: The Next Wave Cities
The Public-Private Partnership (PPP)
programs of DOST-ICTO for the IT-BPM
industry are shown in Figure 2. These
programs aim to: ensure the sustained
growth and competitiveness of ICT industry
segments and firms; formulate and
implement an integrated and comprehensive
program to support the growth of the ICT
industry in the regions; undertake the
development of an industry-relevant
curriculum in coordination with the industry,
government, and academe to enhance the
competitiveness of the ICT workforce; and
formulate, recommend, and implement a
comprehensive and harmonized ICT
promotions and advocacy program. Some of
the programs are briefly described below.
Stepping Up the Value Chain
Developing the different IT-BPM segments is

the focus of the Stepping Up the Value Chain
Program. This program is part of a long-term
strategy to strengthen the country’s global
positioning in high-growth segments of the
IT-BPM industry including healthcare
information management outsourcing; F&A
and insurance services; HR; multilingual
BPM; IT outsourcing and software
development; creative process outsourcing
(includes animation and game
development); engineering services
outsourcing; and, voice BPM.
Among the key projects that will be

undertaken is the conduct of a baseline
study on the IT-BPM segments to capture
industry data and information. Among the
indicators that will be gathered include profile of companies, employment, geographic markets served,
and portfolio of services, among others. Such compiled information will serve as key inputs to the
development and formulation of a strategic growth plan for the near term (5 years) for the IT-BPM

segments. This study will also help define the CSS’s global market share and market share in the main
sourcing geographies, headcount, revenues, service offerings and capabilities, contribution to the
Philippine economy, and other relevant metrics. The study will likewise develop milestones and strategic
recommendations on how the Philippines can achieve its global leadership position.
The Next Wave Cities™
The growth of the IT-BPM industry will translate to more jobs created not only in the urban areas but
also in the Next Wave Cities™. For several years now, the DOST-ICTO and IBPAP have been assessing
locations outside Metro Manila in terms of their readiness to host ICT investments. The Next Wave
Cities™ scorecard was developed to measure such capability, specifically on talent availability and
profile, reasonableness of cost, availability of infrastructure, and state of business environment and risk
management.
The Next Wave Cities™ program not only aims to spread the economic benefits of the growth of the IT-
BPM industry but also to decongest the existing locations to help mitigate the impact of increasing
competition for talent. Various stakeholders from the academe, private sector, and the government in
each of these locations are convened to form multi-stakeholder, private- sector-led ICT councils that
play the critical role of charting their strategic directions in the area of developing their respective ICT
and IT-BPM industry. These ICT councils, numbering to about 45 as of end 2012, have formed a national
organization, the National ICT Confederation of the Philippines (NICP), which interfaces with various
stakeholders at the national level.
During road shows conducted in the Next Wave Cities™, representatives from various industry
associations and other stakeholders travel to these areas to help increase awareness about the
opportunities in the IT-BPM industry. Research on enabling growth and innovation in these cities are
also pursued. Figure 3 illustrates the Next Wave Cities™ mapped according to the identified Centers of
Excellence, the Top Ten for 2012, as well as emerging cities.
Industry Public-Private Partnerships
The role of government in enabling the growth of an industry is clearly demonstrated through the
support it extends. Several government agencies have in place various programs to ensure that the
administration of President Benigno S. Aquino III achieves inclusive growth. This means that for the
IT-BPM industry, it has to be able to generate investments that would translate in the employment of
Filipinos in the Philippines. However, the private sector cannot do this task alone. Nor can government
pursue reforms without inputs from the industry. The expertise and resources of both the public and
private sectors were forged into what is called industry public-private partnerships. Such collaboration
has catalyzed the formation of key programs and the implementation of strategic initiatives, across the
areas of developing talent, enhancing the ecosystem, and promoting industry brand.

WORKSHOP DISCUSSION ON THE DOST-ICTO PROGRAMS
The country possesses an adequate ICT infrastructure and policy framework that is geared toward
growth and development of ICT tools, infrastructure, and knowledge. The human capacity development
programs of DOST-ICTO are aligned with the IBPAP’s own programs. The challenge is in keeping the
country’s momentum and preserving market share. There is a consensus that the IT-BPM Road Map has
set ambitious targets for the industry and that achieving the baseline scenario in that study will not
necessarily be a bad result.
Editors Notes
Approaching an Inflection Point
The Global Talent Index (GTI) Report: The Outlook to 2015 written by the Economist Intelligence Unit
and published by Human Resource advisory firm Heidrick & Struggles reports that even with the
global economic downturn and the temporary talent surplus in the West, the “talent wars” will
continue to rage on. Emerging economies with large and young populations have a singular
opportunity to fill the inevitable talent supply gap that global demographic trends will bring about.
The GTI rank of the Philippines for 2011 is 44th place. By 2015, the country is expected merely to stay
in place. The study offers a simple formula for success: follow the example of the US and the Nordic
countries where almost one in three universities consistently churn out graduates who are well-
equipped with the intellectual rigor to prosper in a competitive knowledge economy. Achieving this
will necessarily mean higher spending on education but more importantly, improved industry-
academe linkages.8
Success in improving tertiary education may not only mean outperforming the targets of strategic
growth plan 2016, it may well mean reaching an inflection point in the country’s economic
development as multinational companies move not only their back office or customer care roles but
also more of their research and analytics.
Some of the activities and future plans of the DOST-ICTO were discussed. (Among the activities
discussed included the update of the Road Map 2016 which was completed by DOST-ICTO, IBPAP, and
TeamAsia in 2013 and trade missions and a road show of 10 Next Wave Cities™ were held in 2012 and
2013.) F&A and HR services, creative services outsourcing as well as multi-lingual BPOs were also
identified as target areas for development. Engineering services were classified as an unserved area of
need, there being no industry association and only 1 or 2 IBPAP members from this field.
The importance of the Next Wave Cities™ initiative was highlighted. The aim is not only to spread the
economic benefits of the growth of the IT-BPM industry but to decongest the existing IT-BPM hub
cities and mitigate the impact of deleterious competition for talent. Branding is a top concern and
during road shows, representatives from IBPAP member associations marketed the IT-BPM industry to
8
The Global Talent Index Report: The Outlook to 2015, Economist Intelligence Unit and Heidrick& Struggles, 2010,
http://www.heidrick.com/WEF2011/Pages/gti-infographic.aspx.

students and teachers in an attempt to eliminate the very shallow understanding of ICT in the
countryside. Finally, DOST-ICTO aims to create a strategic growth plan for each of the industry sectors
but funding is still being worked out.
Editors Notes
Areas for Future Study
A number of possible areas for further study were identified during the course of the DOST-ICTO
programs discussion but which, unfortunately, were not considered more fully due to time and scope
constraints:
 There was a general sense that the industry can be more aware of the progress in DOST-ICTO
initiatives. Improved awareness should then allow for wider private sector participation and
support for the DOST-ICTO programs. That said, how could the DOST-ICTO communication effort
(and network) be improved to engender the awareness, participation and support of a wider
spectrum of industry participants?
 The Philippines’ share of the global IT services market was a mere 1%. The country’s initial goal is
to double that market share. Nevertheless, in light of the importance of an IT infrastructure and
ecosystem to the industry as a whole, perhaps it was better to view IT services not just as a
standalone industry sector but also as a strategic element in boosting the attractiveness of the
entire BPM industry. In this context, the desirability of a more ambitious target (say, a 3%5%
market share) needed further study and evaluation, especially in the context of the possible
multiplier effect of growth in IT services.
 The challenge to dramatically ramp up the growth target for IT services begs the questions: do we
have an adequate skills base within the various IT disciplines to support the entire BPM industry?
What does the Corporate Services Segment, including the F&A service providers need from IT as
growth enabler?

IV. The IBPAP Programs
The Philippine IT-BPM strategic growth plan 20112016 was developed to outline how to dramatically
enhance the country’s value proposition through a concerted effort between industry and government,
to increase the industry’s visibility internationally, and to enhance awareness of the range of non-voice,
complex services that the Philippines is able to provide. The strategic growth plan put forth a revenue
target of US$20 billion to US$25 billion for the IT-BPM industry and the generation of a total of
3.1 million to 4.5 million direct and indirect jobs (Figure 4). Participants took note that the industry
generated sufficient tax revenues from IT-BPM Industry salaries and wages, alone, that was said to be
equivalent to 4 times to 6 times what it received in PEZA and other incentives. It was suggested that the
IBPAP could enhance the industry’s negotiating position with government by quantifying and
documenting its beneficial impact on the country’s GDP as well as the government’s fiscal position.
Figure 4: The goals of the IT-BPM Strategic growth plan 2016
Source: BPAP. 2012. “Accelerating Global Leadership in IT-BPO and Job Creation by Transforming Our Public-Private
Partnership.” (PowerPoint presentation.)
The workshop touched on the current role of the IBPAP in meeting the goals of its strategic growth plan
2016 for the industry and of the need to continually revisit and update that role in order to better
address the evolving landscape of issues and challenges facing the industry. Based on the results of the
survey and the focus group discussions (FGDs), the key areas of concern were:

 rising attrition rates and, consequently, staff costs
 sourcing scarce specialist staff and executives
 rising relative cost versus India, mostly due to a strengthening Philippine peso and energy costs
 infrastructure challenges, principally in the Next Wave Cities™
 incipient threat of changes in government policies
Figure 5: The IT-BPM initiatives being orchestrated by IBPAP to achieve US$25 billion in revenues
Source: BPAP 2012
About 90% of the IBPAP’s time and resources is spent on talent development. Over a million university
graduates need to be hired over the next 5 years to make the industry’s programs scalable. This
translates to a net increase in talent supply of 530,000 new entrants over the current projections
(Figure 5). The looming talent supply gap in the industry, defined as available supply versus total
demand is increasingly significant (Figure 6).

Figure 6: A widening talent supply gap will accelerate cost and quality pressures
Lastly, the current IBPAP programs on talent management presented in Figure 7 below were discussed:
 The Global Competitiveness Assessment Tool (GCAT) is an industry-developed assessment tool

benchmarked to the skills of those currently employed in the industry. IBPAP tested over 15,000
students and 3,000 IT-BPM employees using GCAT and documented a serious gap between the
competencies of students compared with the employees in key areas identified by industry for
basic employment. These areas include learning ability (verbal and numerical), English
proficiency, perceptual speed and accuracy, computer literacy, and service orientation.
 The Advance English Pre-employment Training (AdEPT), based on then eTelecare’s (now Stream
International Global Solutions Philippines) in-house courseware and created in partnership with
the Coordinating Council of Private Educational Associations (COCOPEA) is cornerstone of
IBPAP’s English-development program. A concrete example of this 100-hour course taking root
and becoming self-funding is in Far Eastern University–Fern College where the course
(abbreviated to 80 hours) is offered to graduating students as part of their practicum or
internship. Further, a Basic English Skills Training (BEST) course has been developed to augment
AdEPT in areas where even basic English skills are lacking, including some of the identified Next
Wave Cities™.

Figure 7: IBPAP Talent Development Programs
Source: BPAP 2012
 The Industry Training for Work Scholarship Program (ITWSP) with the Technical Education and
Skills Development Authority (TESDA) for near-hire training successfully scaled because of the
investment that government has poured into it over the years. The program includes the TESDA
train-the-trainers (T3) program. In late 2011, TESDA allocated ₱500 million for IT-BPMrelated
training. By March 2013, in partnership with IBPAP and its partner associations, 65,000 had been
trained and 46,000 had been employed.
 IBPAP’s Service Management Program (SMP) is a specialization track for business and IT courses
offered in colleges and universities. Competencies taught are aligned with GCAT and include 3
units of business communication, 3 units of system thinking, 3 units of Fundamentals of BPO
101, and 3 units of Fundamentals of BPO 102. To complete the track, SMP students must also
undergo a 600-hour internship in an IT-BPM company. In academic year 20112012, SMP was
piloted in University of Makati, University of Santo Tomas (UST), Lyceum of Laguna, and Asia-
Pacific College. In 2013 to 2015, through a partnership with the Commission on Higher
Education (CHEd) and IBPAP, SMP will be rolled out in 17 state universities and colleges (SUCs)
throughout the country. CHED has allocated ₱125 million for the implementation of the initial roll
out of SMP in the selected SUCs.
The presentation on IBPAP Programs ended with some forward-looking concerns that IBPAP sought to
address:
 attainment of leadership in new markets
 achievement of sustainability, that is, how do the programs become self-funding?
 devolution of the development programs to the school and company level

WORKSHOP DISCUSSION ON THE IBPAP PROGRAMS
The discussions about the IBPAP programs centered on a few themes:
a. Long time-fuse for IBPAP programs

The long lead time required for the incubation, maturation, and expansion of some of the IBPAP
programs presented a significant challenge for many expanding IT-BPM companies struggling to
meet current deadlines to recruit manpower, especially against the backdrop of a 10% pass rate
for candidates:
 It was going to take at least a couple of years before BPO Fundamentals (BPO 101) course
takes root, particularly in the provinces. There could also be an opportunity for the
IBPAP to undertake brand building to create awareness of career opportunities in the IT-
BPM industry beyond contact center work. This would reinforce any academic programs
along the lines of BPO 101. [IBPAP response: IT-BPM career education was done through
print and online media releases, career road shows with DOST-ICTO, and, for a limited
time, through social media. The SMP roll out with CHEd funding also includes resources
for career marketing.]
 The telecommunications infrastructure has managed to keep in step with the emerging
opportunities for the IT-BPM industry. However, educational institutions and local
governments have not been able to provide both the English and BPO 101 skills critical
to potential locators. The universities and the local government units (LGUs) in the Next
Wave Cities™ urgently needed blueprints and plans to put the educational building
blocks in place. In this context, IBPAP’s programs could prove effective in building
capacities for these universities and Next Wave Cities™. [IBPAP response: SMP is being
rolled out in the Next Wave Cities™ and ITWSP is a nationwide program.]
 Furthermore, the private universities and other SUCs need the resources to execute on
their plans and, in the absence of a game-changing intervention (such as additional
funding or a sustainable business model), these institutions might be unable to bridge
the training resources gap. [IBPAP response: CHEd has provided funding for the first 17
SUCs to offer SMP. However, private higher-education institutions must fund SMP and
other programs if they would like to offer them. Funding will also have to be provided
for rolling out SMP in the balance of the SUCs.]
 English skills training is difficult for individual companies to independently offer. Often,
technical skills are less of problem to teach than English education. Is there anything
that the IBPAP can offer in the form of flexible, modular, and effective online English
courses to be taken by individual employees? Or, is there an alternative way to
otherwise employ computer technology in English education such as web-based
learning? [IBPAP response: IBPAP’s programs have online and web-based components.
Others are being developed and many are already commercially available.]

 Leverage on the partnership with CHEd to promote SMP in other education institutions.
[IBPAP response: SMP is being rolled out in 17 SUCs under the current IBPAP-CHEd
partnership.]
b. Demand for generic skills

The need for generic (as opposed to technical) skills was a prevalent perception across the
verticals in the CSS:
 Multi-lingual services has great potential but generic skills are needed:
o Mandarin Chinese and European languages in particular were identified as necessary
to communicate with the clients
o targeted culture and history lessons to understand and relate better to clients
 The demand for experienced HR professionals has always been high. Multi-lingual skills
for these HR individuals would highly improve their value proposition.
 Technical skills training provided by the IT-BPM companies through their internal
development programs needed to be complemented by training in service values.
 A more extensive version (i.e., longer than 100 hours) of English-proficiency training
(AdEPT) should be made available in the short-term. The Department of Education
invited IBPAP to provide inputs to the K to 12 Basic Education Program and, as a result,
it is in a unique position to craft a more permanent and sustainable solution to the poor
quality of English skills.
c. TESDA
Can entrepreneurs be enticed to partner with TESDA to offer skills training other than English
proficiency, e.g., SAP user training or other foreign languages?
d. IT-BPM Industry Brand

Increasing the attractiveness of the industry to the labor force is a challenge. People join
IT-BPMs not as a career but instead either for the (relatively high) salaries or as a stepping
stone. The industry is still synonymous with contact centers. Because of that contact center
stigma, parents of graduates are disappointed when they learn that their children are joining a
BPO. The wider implementation of SMP will create the awareness and appreciation of the
industry. Next Wave Cities™ will bring the jobs to other areas.
e. Effective Tripartite Partnerships

The collaboration among the academe, the IT-BPM industry, and the government agencies for
education (led by CHEd) is necessary for the improvement of curriculum for CPAs. Accounting
remains a very traditional profession and accounting courses are geared too much towards
external audit. This is despite the global sea change in the F&A stemming from such
developments as the international global convergence of accounting standards (principally
revolving around International Financial Reporting Standards), the Sarbanes-Oxley and the
Dodd-Frank legislation in the United States, new technological tools for business intelligence

and data analysis like eXtensible Markup Language (XML) and eXtensible Business Reporting
Language (XBRL) tags (see box below), and Committee of Sponsoring Organizations of the
Treadway Commission’s (COSO’s) internal control and risk management standards, among
others. How do you start the collaboration process between academe and the industry? Where
government will not have a direct hand, it should consider pump-priming like allowing triple tax
deductions for experimental type courses.
Editors Notes
Is XBRL a Disruptive Technology?
XBRL or eXtensible Business Reporting Language is a standards-based means of exchanging business
information between systems built on XML (eXtensible Markup Language) protocols. XBRL allows data
to be tagged and enriched to allow the reader to understand the business facts being reported. For
example, data tags for Foreign Exchange Reserve accounts could contain, among others, information
regarding the company or trader involved and the time period for which the data is valid.
Because the data reported contains imbedded information that uses a standard set of definitions or
taxonomies, this allows the recipient to automate the extraction and exchange of data. These
interactive data taxonomies allow reported data to be identified, in the same way that bar codes
identify products, and feed these to the appropriate analytical tools. Using XBRL will allow individual
investors, for example, to quickly sift through financial reports without having to deal with voluminous
footnotes and disclosure statements.
In a major development US Federal Reserve Bank and the US SEC has adopted XBRL as the standard for
reports filed by large listed companies.
This will have an enormous impact on the business models for the finance and accounting and audit
segments of corporate services and will most likely consign a large number of lower-skilled roles
currently outsourced to the Philippines to obsolescence. On the positive side, the next few years will
see a large demand for accountants with the expertise to apply XBRL tags to the data in innumerable
financial reports.

V. The CSS Project: Survey and Focus Group Discussion Results
A survey was conducted in September 2012 in order to obtain an understanding of the broad
opportunities and threats facing the CSS. Subsequently, two focus group discussions were held in
October 2012 to discuss the survey results, build a consensus on the nature and extent of the
preponderant issues facing the CSS, and develop the preferred strategic approaches to addressing these.
Although the small sample size does not guarantee a statistically accurate result, this may however still
provide a good directional gauge of the industry trends and circumstances.
Profile of survey participants

The companies that participated in the survey have been operational in the Philippines for an
average of 9 years and employ an average headcount of 2,200 staff. While the survey respondents
appear to be slightly skewed toward the more established companies, what the respondents
profile does underscore is that the IT-BPM industry in the country is at mid-maturity and should
rightfully be formulating a more targeted strategy.
Nevertheless for purposes of this survey, the majority of companies invited to participate were
global in-house centers (GICs) because these companies tend to perform more corporate
services. Consequently, the GIC respondents naturally tended to predominate (Figure 8).
The survey shows that the single most important market for the Philippines is the United States
(US) with 70% of survey respondents providing services, although this percentage is ostensibly less
pronounced compared with the past. The Philippines (54%), UK (46%), Asia (46%), represent
equally significant markets after the US. Business with the rest of Europe lags behind, reflecting
among other things how the local fluency with the English language (and the lack of fluency in
European languages) affects our geographical market share.
Figure 8 Profile of survey participants by business model
To better disaggregate the business of companies in the CSS, we adopted

a similar services categorization, shown in Figure 9, as that employed by
Gary Gereffi and Karina Fernandez-Stark both from the Center on
Globalization, Governance, and Competitiveness of Duke University for
their 2010 Policy Research Working Paper for the World Bank entitled
“The Offshore Services Value Chain: Developing Countries and the Crisis.”

Figure 9: Offshore Services Value Chain
Most of the survey participants do not offer horizontal or vertical services exclusively. It is notable that
in a survey population that is predominantly composed of GICs, horizontal services would still constitute
the greater bulk of service offerings (Figure 10). F&A is the most significant horizontal service, offered by
62% of the survey respondents.
Except perhaps for financial services (38%) and to some extent, health and pharmaceutical services
(15%), the potential of GICs in the Philippines to offer higher-value vertical work remains to be a work in
progress. Another observation that can be made is that because of the relative scale of the local IT-BPM
companies, these tend to have some degree of in-house IT support. That foot in the IT services door,
however, does not appear to have translated to full-fledged, autonomous business units.

Figure 10: Profile of Survey Participants by Services Offered
Survey participants were asked to rate the twelve factors that influenced their company’s decision to
locate or expand in the country from a scale of 1 to 5, 1 being the lowest (no impact) and 5 the highest
(major impact). Fifty four per cent (54%) of the respondents indicated that the availability of English-
proficient and skilled labor had a major impact on their decision while 38% said that it had a significant
impact, for a rating average of 4.31. The second-most important factor was the legal and regulatory
framework and policies (excluding taxation and customs) with a rating average of 4.15. The summary of
location decision factors is shown in Figure 11 below.
While cost arbitrage opportunities are important, this factor does not drive the location decision.
Cultural adaptation ranks almost equally with cost considerations. This indicates that the range of
strategic options available to attracting more locators into the country is not limited to ones that are
driven by cost.

Figure 11: The significance of location decision factors
The survey also sought to explore the so-called hygiene or maintenance factors by asking the
respondents to rate the issues and challenges that could trigger a decision to discontinue or downsize its
operations in the Philippines (Figure 12).9
As expected, legal and contractual enforcement as well as data privacy figure very highly as critical
hygiene factors. Despite the recent appreciation of the Philippine peso (against the backdrop of the
depreciation of the Indian rupee), only 25% of the respondents have signified that escalating costs have
a major impact while another 33% have indicated that the peso appreciation has significant impact.
While the rating average of 3.67 indicates serious concern, this is still surprisingly muted despite the
11.4% appreciation of the Philippine peso versus the US dollar from year-end 2009 and the 6.4%
appreciation from year-end 2011 to year-end 2012.
It is almost paradoxical that the single biggest attraction to locating in the country is also the most major
hygiene factor. There are several possible explanations, all of which eventually translate into higher
labor cost:
 Growth in the talent pipeline is not keeping pace with demand growth (demand vs. supply
changes)
 Changes in the talent needs particularly as firms mature and the talent needs become multi-
layered (demand changes)
9
Freely adapting Frederick Herzberg’s Two-Factor Theory to organizational motivations for outsourcing and offshoring .

 Market inefficiencies impeding timely access to the right talent in a fragmented pool is
manifesting in, among other things, the longer than five weeks that it takes to fill up a
professional vacancy (talent market maturity).10
Figure 12: Issues that can lead to business discontinuance or downsizing
Majority of the local service companies remain optimistic about favorable conditions in 2012 continuing
on in 2013. Beyond a one-year horizon, however, there are a number of issues that can reverse this
outlook (Figure 13). Note the markedly higher average rating for a number of factors foremost of which
is the continued availability of technical staff (with an average rating of 4).
The negative impact of a continued appreciation of the Philippine peso against the US dollar is a major
concern indicated by the average rating of 3.92. The depreciation of the Indian rupee has also
contributed to the widening cost difference between Indian and Philippine IT-BPM offerings in favor of
Indian suppliers. Where cost is a significant consideration in locating services, Philippines suppliers have
seen work being moved to India that would otherwise have been done in the Philippines. GICs were less
affected since availability of skills is of primary concern over cost. In any case, a strong peso should be an
underlying premise of any strategic growth plan for the CSS.
10
Skilled Labour Shortfalls in Indonesia, the Philippines, Thailand, and Vietnam, Economist Intelligence Unit, July 2012,
http://www.britishcouncil.org/labour_market_shortfalls_in_sea_eiu_final_18_july.pdf.

Figure 13: Factors that impact the outlook of operations

VI. CSS Workshop Findings and Recommendations
This preliminary study on the CSS of the IT-BPM industry tackles four elements of strategy, as shown in
Figure 14 below, stopping short of defining a strategic vision and values as well as carrying out a full-
scale strategic planning process:
 current and emerging needs of the IT-BPM industry in the areas of talent management and
development
 strategic objectives that need to be met in relation to the needs expressed
 competitive conditions that need to be considered
 priority areas for action and development
As such, the value gaps expressed as current and emerging needs here are necessarily anecdotal and
intuitive but still fundamentally valid.
Figure 14: Elements of strategy in the CSS study

CURRENT AND EMERGENT NEEDS
The CSS strategic growth plan will need to effectively address the following needs articulated by the CSS
firms in relation to talent sourcing and talent development:
Need to improve employability of university graduates
The issue has been deliberated numerous times: although many Filipinos apply for work in IT-BPM
companies, the hiring rate is presently just 5 percent to 10 percent. Most applicants do not make
the cut because they lack the necessary qualifications, skills, and professional expertise. Some
companies are even reported to be logging a dismal 3% hit rate.11 Outside the IT-BPM industry
however, employability in the country was registered at around 46% according to a UNESCO study.12
Another point of comparison is India. It is reported that 25% of technical graduates and 10%-15% of
general college graduates are employable in the BPO industry in India.13 (There is some dispute
about this particular statistic. Other reports disclose that this is true only for metropolitan hubs.
Outside of the hubs, the averages drops down to 5%.)14
What seems clear is that even BPO powerhouse India struggles with talent quality issues and no less
than Nirmalaya Kumar, one of the authorities on Indian business and a thought leader in strategy
and marketing did not mince his words in describing India’s talent quality problem:
“. . . India has the youngest growing population in the world. This demographic dividend is
incredible, but paradoxically, there's also the mirage of mighty labor pools. Indian institutes and
educational system, with a few exceptions, are incapable of producing students in the quantity and
quality needed to keep this innovation engine going, so companies are finding innovative ways to
overcome this, but in the end it does not absolve the government of the responsibility for creating
this educational structure.”15
In the Philippines, the data suggests that universities are lagging behind in training students for
employment in the IT-BPM industry, hence the job and skill mismatch. The industry has claimed that
proper training can bridge the skills gap. As much as 30% of job applicants were identified as near
hires, that is, those individuals that exhibit good potential for employment. Also close to 70% of
near hires can be made employable with about 100 hours of English-proficiency training.
To help address the need to improve the employability of graduates, President Benigno S. Aquino III
allocated ₱500 million in October 2011 for TESDA's ITWSP. Some ₱416 million of this fund
administered by TESDA was spent in 20122013 to train 67,000 near-hire scholars, with 46,000 of
these finding employment. Part of the original allocation was used to train trainers and other
scholars.
11
Guia P. Bengzon, Where have all the English Speakers Gone?, July 11, 2007, http://www.johnclements.com/wazzup0707/Recruitment_and_Retention.pdf.
12
Graduate Employability in Asia, UNESCO, 2012.http://unesdoc.unesco.org/images/0021/002157/215706e.pdf.
13
India Reports, http://india-reports.com/articles/top-obstacles-outsourcing.aspx.
14
The Employability Factor in BPOs, Value Notes, 2008,http://www.sourcingnotes.com//content/view/328/65/.
15
Nirmalaya Kumar: India’s Invisible Innovation, http:/www.ted.com/talks/nirmalya_kumar_india_s_invisible_entrepreneurs.html

Discussions on employability tend to focus on supply-side concerns (i.e., the attributes of
individuals) and this study will dwell considerably on these concerns. But the variability in hiring
success of similar firms suggest that the differences in employers’ formal and informal recruitment
and selection procedures, access to university graduate information, and the search channels and
job-matching technologies used are also important.
Need for better functioning recruitment markets
Mid- to high-level professional managers and technical specialists can often be scarce resources and
difficult to locate in a labor market that is both opaque and fragmented. In the World Economic
Forum Global Competitiveness Report for 20122013, the Philippines was one of the most-
improved countries, advancing 22 places to rank 65th globally. Nevertheless, in terms of labor-
market efficiency, the Philippines languishes at 103rd place out of 144 countries.
One group of participants in the study articulated the power of establishing clear and objective
standards for determining proficiency in key skills areas such as oral and written communication and
project management so that schools and universities could track the capabilities of their graduates
and the effectiveness of their programs. A valuable offshoot of rolling out GCAT across the country
would be to establish these standards and thus provide the mechanism for measuring attainment of
these standards through a feedback loop linking recruiters and the sources of future talent.
Need to manage attrition
An AON Hewitt study for AmCham Thailand shows that overall attrition rate across all industries and
positions in the Philippines rose slightly to 12.6% in 2011 from 12.0% in 2010; though up from 8.0%
in 2009 (Figure 15). The experience during the same 20082011 period, however, has been broadly
similar in India, China, Malaysia, and Vietnam. Additionally, a Towers Watson 20112012 survey
(conducted between late April through early June 2012 among 1,605 companies globally, including
796 from Asia Pacific) found that the attrition rate in the Philippines in 2012 was lower than in other
fast-growing economies such as China, India, Indonesia, Malaysia, Thailand, and Vietnam. The
Philippines also reported higher hiring activity than other countries in the region.16
16
Low Attrition Rate, Julito G. Rada, 06 December 2012, http://manilastandardtoday.com/2012/12/06/low-attrition-rate/.

Figure 15: Year on Year Attrition Rate in Asia Pacific
Source: AON Hewitt
Focusing on the IT-BPM industry, it is estimated that more than 18% of employees leave their jobs
every year mostly to join other IT-BPM companies. This is particularly true among contact centers.
Further, the Towers Watson survey reveals that employees in the BPO industry in the Philippines are
more willing to relocate to other countries compared with other nationalities in Asia Pacific and thus
this mobility is seen as a major contributor to employee turnover.
Attrition can be managed by focusing on retention factors. The 2012 Towers Watson Global Talent
Management and Rewards survey found that Philippine-based employers perceived health care and
wellness benefits among the top attraction drivers. In contrast, employees were attracted by
learning and development opportunities. Further, the study reported that employers in the
Philippines underrated the impact of trust or confidence in senior leadership, job security, and
convenient work location as retention drivers.
In recent years, companies that have located in cities such as Davao and Cebu have also started to
experience rising attrition. These companies have resorted to salary and incentives reviews as
corrective measures.
Need for interventional training in employability skills
Traditional tertiary education is geared more towards textbook knowledge and less about analytics.
As previously mentioned, there is a consensus on the immediate need for interventional training to
address this flaw. Improving generic (as opposed to technical) skills among university graduates will
enhance their employability. This view is neither surprising nor unusual—a slew of literature exists
that refer to the so-called generic skills as employability skills. There are four areas of employability
skills that can be the subject of interventional training in Figure 16 below (loosely based on a 1998
Coopers & Lybrand study on employability skills).

Finishing school–type short courses are critical under today’s circumstances of worsening demand-
supply imbalances but these are stop-gap measures at best. In order to achieve sustainability, these
training programs will need to be incorporated into the secondary and tertiary education study
programs; IBPAP's SMP is an example of how this can be done.
Figure 16: Areas of employability skills
Need for continuing professional education
IT-BPM companies operate in an environment that demands new and constantly developing skills to
retain global competitiveness. There is a strong apprehension among the local F&A service providers
that local accounting education will remain very traditional and largely geared toward public
accounting practice if local universities do not urgently revamp their curricula. In an ideal case,
universities should create formal means to understand employer needs and tailor the training
accordingly. Courses should recognize the constantly evolving contemporary issues and deliver the
requisite multidisciplinary knowledge, system thinking, and an understanding of social context.
Punongbayan & Araullo (P&A) together with a number of private industry associations—People
Management Association of the Philippines (PMAP), Financial Executives of the Philippines (FINEX),
Philippine Institute of Certified Public Accountants (PICPA)—are supporting a 3-month study by the
University of Asia and the Pacific (UA&P) on how best to strengthen the accounting curriculum
starting with the identification of gaps in the competencies required by the business sector. Some

participants of the study suggested that topics such as those below be included in undergraduate
accounting courses in order to reduce the gap between education and practice:
 user training in SAP (particularly in financials and controlling or FI-CO) and other Enterprise
Resource Planning software
 preparatory courses to the ongoing international convergence of accounting standards
 COSO’s Internal Control Integrated Framework
 implications of the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and
Consumer Protection Act, the Bank for International Settlements (BIS) pronouncements, and
the OECD transfer pricing guidelines, etc.
Best practice in curriculum adaptation is demonstrated by Holy Angel University (HAU) in Pampanga
and can serve as a model for local business and accounting schools. The HAU College of Information
and Communication Technology offers a Bachelor of Science in Information Technology major in
Network Administration. HAU ensures that the course is tailored toward industry requirements
because of its partnership with CISCO Systems Networking Academy. Graduating Network
Administration students usually take the Cisco Certified Network Associate (CCNA) exam. This
certification assures a prospective employer that the candidate can install, configure, operate, and
troubleshoot medium-size route and switched networks, as well as implement and verify
connections to remote sites in a WAN. HAU faculty include CISCO instructors who can provide
review classes for the CCNA exams.
Workshop participants noted that since IT-BPM companies are in the business of supplying cross-
border services, the universities with outdated curricula may benefit by cultivating tie-ups with
these companies and with international organizations.
The UNESCO Institute for Educational Planning published a report in 2007 citing that only 60 higher
education institutions (HEIs) in the Philippines out of more than 1,400 have active linkages with
foreign institutions. Most of these linkages are for academic and cultural exchanges and only five
Philippine HEIs—inclusive of Holy Angel University—are known to have arrangements with foreign
providers involving importation of transnational higher education.17 (Note that the observation
about the gap between the academe and industry practice will, thus, apply not only to F&A but
perhaps to the entire CSS).
There is also a need for stop-gap measures to bring new graduates up to speed. On its own
initiative, P&A has been conducting seminars on industry trends, sponsoring quiz bees, and
providing support for career day programs in order to share the firm’s industry expertise with
faculty and students of a number of universities including Bicol University, De La Salle University,
Saint Louis University, Holy Angel University, Polytechnic University of the Philippines, San Beda
17
Cross-border higher education: regulation, quality assurance and impact (Chile, Oman, Philippines, South Africa), UNESCO Institute for Educational Planning,
http://unesdoc.unesco.org/images/0015/001538/153897e.pdf.

College, University of the Cordilleras, University of the East, University of the Philippines, University
of San Carlos, and University of San Jose-Recoletos.
The suggestion from the workshop is to institutionalize the individual company initiatives similar to
that of P&A and to offer the undergraduate topics above as part of the Professional Regulation
Commission (PRC) and PICPA’s Continuing Professional Education (CPE) topics, as an interim
measure. CPE courses should also facilitate the achievement of internal certifications such as the
International Financial Reporting Standards (IFRS) certificate program or the certified internal audit
program. Companies that want to outsource or handle offshored work will look to recognizable
standards. International professional certifications can help give visibility about the quality of talent.
Finally, there is a recognition that the best accounting graduates will still be found in Metro Manila.
However, this is not to say that there is no meaningful role for the Next Wave Cities™ to fulfil. There
is still a large need for graduates of courses such as BS in Accounting Technology to satisfy roles that
involve bookkeeping, among other things. Nonetheless, there are standards to be met (and
disclosed) in this regard.
COMPETITIVE CONDITIONS
It is important to accurately represent the prevailing competitive conditions because this will shape how
any CSS strategy will be effective in achieving the priorities concerning the IT-BPM industry. Some of the
competitive conditions include the following:
Heterogeneous companies in the Corporate Services Segment
There is considerable diversity in the service offerings—if not the business models—of companies
lumped together in the CSS. It is a challenge to define the common needs across these diverse
companies. Defining the needs for continuing professional education will need to be done at a more
granular level, for instance.
Appreciating peso
The continuous inflow of foreign exchange in the country has led to a steady climb in the value of
the Philippine peso. [The Philippine peso has depreciated in late 2013-Ed.]The country’s gross
international reserves stood at US$84.1 billion in November 2012, the highest on record. The
amount is enough to cover the country’s import requirements for over a year and is also nearly
seven times the combined short-term debt of private and government entities in the Philippines.

The BSP has been incurring foreign exchange losses at more than ₱36 billion a year in the last two
years in its efforts to stem the appreciation of the peso. The likelihood that the BSP can slow down
the appreciation of the currency with the same effectiveness as in the past is unlikely.18
Graveyard shift and the contact center stigma
The technical (and consequently the value-adding) content of most CSS roles is appreciably higher
compared with a typical contact center job. So while there is relatively less concentration of roles in
the CSS in the graveyard shift, there is also a higher concentration of professional staff in the CSS
service teams with a strong aversion to working in that shift even if the offered role is directly
coupled with an attractive career ladder.
Parental influence is strong with single, young professionals and their views typically reflect the
largely unwarranted perception that contact center jobs are good only for the short term and have
serious negative safety and health effects on employees. These views are usually fed by media
reports reflecting little understanding of contact center work but which unfortunately affects other
IT-BPM sectors including the CSS.
Concentration of talent in NCR
Firms in the CSS have a common perception that there persists a concentration of talent in the NCR.
That the best accounting professionals are predominantly in the NCR best illustrates this
observation. To be sure, the more populous cities in the Philippines will be more successful in
contributing to the overall talent pool than the less populous areas. Nonetheless, a quick inspection
of the number of accounting graduates passing the CPA Board examination last May 2012 reveals
that roughly 40% of all the successful candidates graduated from universities in the NCR—compared
with NCR’s 13% share in the country’s population (2010).
By comparison, the greater Cebu and Davao regions only managed single-digit percentage shares of
the country’s successful CPA examinees—a far cry from the NCR’s performance. For one, there is a
need in the Next Wave Cities™ for more CPA review schools and more anchor universities, like the
University of Santo Tomas in the NCR, which can produce a large number of high-quality graduates.
Stable government incentives
While the relative cost of operating in the country remains to be a fraction of retaining the same
operations in the parent organization, the one-time costs of migration and transition including the
costs of establishing a governance framework and an IT network can be considerable. The stable set
of fiscal incentives (i.e., national through the BOI and PEZA and local through the LGUs) granted to
18
BSP losses balloon to ₱68.36 billion in third quarter, The Philippine Star, November 19, 2012, http://www.philstar.com/business/2012/11/19/868261/bsp-
losses-balloon-p6836-billion-third-quarter. [Note: In December 2013, on signs of a meaningful recovery by the US economy, the dollar strengthened vis-à-vis
currencies in the region including the Philippine peso. –IBPAP]

the IT-BPM industry has been effective in countervailing the switching costs involved in setting up in
the country.
Weak Global Demand
The high unemployment rate in developed countries, particularly in Western Europe, will remain
intractable due to the continuing global recession. The recovery of employment to its pre-recession
peaks is expected to be achieved only sometime in 2016. These factors will contribute to tepid
demand for offshoring as developed economies put priority to creating employment in their own
backyard.
Telecommunications infrastructure
Telecommunication companies (Telcos) follow their customers and customer demand drives the
continuous infrastructure investments by the Telcos. Telecommunications infrastructure has been
built in the Next Wave Cities™ and Telco capacity is not seen as a limiting factor to growth in the
short to medium term. Communications costs are moderate.
Despite this, there is a strong reason for concern because Philippines has been steadily dropping in
the World Economic Forum’s global ranking for Networked Readiness—from 58th place in 2001 to
86th place in 2012. The Networked Readiness Index (NRI) measures the capability of countries to
take advantage of opportunities offered by ICT for development and increased competitiveness.
Continuing shortage in teachers
While initiatives such as the TESDA Train the Trainor program are laudable, any serious attempt at
large-scale, geographically distributed talent development program will inevitably be met with a
shortage of teachers. Further, many of the generic skills required by the CSS will be more
appropriately taught as part of secondary and tertiary education.
Thus, the investment with the most direct impact on the scalability of talent development is the
upgrade of the salaries of teachers. This is a structural issue that has been apparent since the 1970s:
teachers are not paid well because students will not otherwise be able to afford the tuition.
The recent economic growth spurt has not materially benefited teachers. In terms of pay, teachers
have been losing ground for most of the last decade. About 30% of teaching and education degree
holders work outside of teaching.19 Further, the country already has a relatively old teaching force
and can expect the supply gap to become more acute before it gets better. In contrast, Singapore
has seen a 27% increase in the number of teachers in the 10-year period up to 2005. While the
structural correctives may be out of the scope of this study, the continuing shortage of teachers will
nevertheless have a pervasive impact on the dominant issue of talent development.
19
Do Countries Paying Teachers Higher Relative Salaries Have HigherStudent MathematicsAchievement?, TEDS-M, Stanford University, 2009,
http://www.iea.nl/fileadmin/user_upload/Publications/Electronic_versions/TEDS-M_Cost_Study.pdf. [Note: More and more of the Philippines’ best teachers are
being hired to teach in other countries. –IBPAP]

OBJECTIVES OF THE CSS STRATEGIC GROWTH PLAN
The objectives of the CSS strategy can be better expressed once the CSS vision has been defined.
Nevertheless, the following should be included:
 Quality – The CSS quality standards for talent sourcing and development need to be defined,
measured against recognized global benchmarks (including professional certifications), and
periodically reported.
 Immediacy – There are industry needs that are immediate, if not urgent. Solutions should be
capable of producing near-term results.
 Sustainability – Governmental and industry intervention should be designed to permanently

alter the CSS’s industry structure and competitive framework. Programs that provide upkeep,
support, or financial assistance should necessarily have defined exits or end dates.
 Scalability–Programs should be designed according to principles of modularity, scope economies

(i.e., co-location), replicability, and work distribution.
 Sourcing efficiency – This will require an efficient information-sharing network and striking a
balance between collaboration and competition among the industry players.
DEVELOPMENT AREAS
CSS firms have identified four broad areas for development that need to be addressed in a CSS strategic
growth plan:
Tripartite Partnership among the CSS, the Academe, and the Public Sector
There are already a few research and data-gathering activities as well as support programs in place
involving private-public partnerships. For example, with respect to the need for a university degree
program for the BPO industry, SMP has been rolled out in four private colleges and universities—
University of Makati, Asia Pacific College, Lyceum of the Philippines University (Calamba, Laguna),
and the Jose Rizal University. SMP will also be rolled out in 17 SUCs over the next two academic
years by IBPAP with funding from CHEd.
The following are other areas for possible improvement:
 Public-Private Partnership Council
To better coordinate efforts, the creation of a Public-Private Partnership Council would be a

good first step. This PPP Council would ensure that the different ancillary programs, e.g., the
Technology Panel on IT Education, act in concert with or in reinforcement of the other
programs and strategic initiatives. It would also serve as a hub for data gathering and
research and the single point of contact for potential locators, investors, host locations, and
other stakeholders. To achieve this, the PPP Council should be composed of industry

association representatives and the key government agencies, including DOST-ICTO and the
DTI.
 Student Internship Programs
A 6-month (600-hour) internship program is integrated into SMP and is the final step in
completing the specialization track. By institutionalizing the internship program, it is hoped
that strong links between schools and companies will become self-sustaining and
widespread.
Internships of this length (rather than shorter-term ones) can be structured to address soft
skills requirements such as cultural intelligence, and practical English proficiency. The
program’s success will also require pre-internship training in the university (in association
with IBPAP or its accredited trainers for schools outside the NCR, if necessary) on corporate
behavior—covering such topics as punctuality, corporate dress code, office productivity
tools and equipment, and how to function in an office setting. Teacher and school
monitoring will have to be agreed on. The advantage of this design to the CS firms is that
this provides them with more time to decide whether they want to select an individual
trainee for permanent employment, it provides them productivity from individuals that are
not usually counted in the headcount, and provides them capacity in case of contingencies.
The GCAT may be used as a basis for selecting both the interns and the schools.
 Teacher-Immersion Programs
There was extensive discussion and a broad consensus that teacher-immersion programs
should be a staple of industry-academe partnerships20. The immersion will involve a
combination of academic research, consultancy, and a customized management
development program and should be for a 3- to 6-month period. The immersion programs
should address a few concerns, such as:
a. Teachers need to better appreciate the IT-BPM industry; they represent a strong
influence on graduates on the latter’s alternative career opportunities. University
relationships address not only talent supply but also the imperatives of brand.
b. The interaction will update the professional skills of teachers in the latest global
developments.
c. Ahead of the slow and deliberate process of the university aligning its curriculum,
teachers can adjust what they actually teach to reflect current realities.
d. The teachers will be entitled to performance-based allowances that will mitigate some
of the structural concerns on low salaries of university faculties.
20
IBPAP has integrated train the trainers (T3) modules under ITWSP and faculty development programs under SMP. The association will also
manage a project funded by the ADB which includes a faculty development component.

The issues that need to be threshed out include:
a. How to mitigate the risk of losing the best teachers to industry
b. Whether companies are able to enlist teachers to undertake research
c. How to involve professors meaningfully without compromising critical processes and
data and information security
 IT-BPM Leaders Career Day
There are many IT-BPM executives and managers who will be willing to participate in IT-
BPM Leaders’ workshops on specific practical topics to be agreed on with the universities as
culminating activities for some courses. This will increase awareness of students about the
IT-BPM industry and increase its attractiveness to them. The program’s success will depend
on a pool of leaders who need to commit to making themselves available. One suggestion
(that generated some debate) is to tie ROHQ and PEZA tax incentives eligibility to university
tie-ups such as this to ensure that IT-BPM leaders will be committed to sustainability.
 Curriculum Redesign
Universities are not immune to branding and some have built their success around a
reputation for excellence in specific fields. For example, the University of Colorado is known
for Mining Engineering and UP Iloilo for Marine Biology. For universities, the active pursuit
of excellence in a specific discipline will require much effort and extensive cooperation with
the Next Wave Cities™ and the specific segments of the IT-BPM industry.
There are several initiatives that may serve as a blueprint for local universities to follow.
Apart from the DOST-ICTOled broad initiative mentioned earlier involving four colleges and
universities, there are five classes on-going at the University of Makati on Service
Management. Another good pilot for curriculum review is being led by P&A to tackle the
mismatch between accounting education and industry needs. P&A is commissioning the
University of Asia and Pacific to survey PICPA, Association of Internal Auditors, IBPAP for
possible curriculum changes and the drafting of metrics other than the CPA certification.
Finally, what is perhaps the most important output of an institutionalized tripartite

partnership is the formulation of an education strategy. An education strategy will tie all of
the different talent development programs together and will allow for better coordinated
execution.
Standards and Communication
Increasingly, companies that wish to outsource or offshore will look to apply globally accepted
standards and measures of the competencies and performance history of potential service providers
before they make their decisions. Professional certifications for key personnel can help give visibility

about the quality of talent. (Some certifying organizations even offer discounted fees and charges
for certification candidates from developing countries.)
The idea of a global set of BPO standards is not new. As early as 2010, China had pushed to attract
foreign direct investment (FDI) in outsourcing by involving several of its provinces alongside the
government bodies associated with outsourcing promotion and the BPO companies to establish
global frameworks and standards on which the BPO companies should operate, as well as
qualifications and certifications for Chinese BPO employees.21 In order to achieve this, China sought
the assistance of an international consulting firm.
The matter of agreeing and publishing human management, skills and performance standards can
be contentious due to the potentially sensitive information that will need to be collected. This is
where government organizations like the NSO and the BSP or industry bodies such as the IBPAP will
be indispensable for success. An illustrative metrics chart for an F&A company is shown below as
Figure 17. The services of the company as well as the performance and talent management metrics
are presented in detail.
Figure 17: Sample metrics chart for an F&A company
Most of the metrics in this chart are self-explanatory. Some, like current skills gap, will need some more
validation to ensure proper interpretation and reporting. In this instance, a good working definition may
be: gaps between the skills currently available within a company’s workforce and the skills which the
organization needs to achieve its business objectives.
21
BCI to help China Software Industry Association on Implementing BPO Standards, September 2010, http://www.bpocertifications.com/bci-news.asp?Y=2010.

The DOST-ICTO and IBPAP talent development programs for the BPO industry already have their key
performance indicators. Ultimately however, the success of the individual IT-BPM companies as
indicated through the agreed set of industry standards and measures will have to be consistent with
outcomes that such program metrics, in turn, reveal over time. Further there may be a handful of
custom metrics that will need to be agreed to gauge the effectiveness of the various talent development
programs for the CSS.
Standards and metrics will have to be agreed right through the entire talent development value chain,
i.e., for the teacher, the students, the schools, and even the information network. Companies will need
to see a “Good Housekeeping Seal of Approval” for the teachers and schools they would want to partner
with. In this way, companies will be better guided about which schools to fall back on for Service
Management or for training on generic skills, for instance.
Standards and metrics are merely the beginning point of a feedback loop. Thereafter, a couple of critical
tasks need to be similarly institutionalized:
 Based on the well-defined and measurable objectives and the related scorecards for the talent
development programs, there needs to be firm processes to fine-tune the content and delivery
of these programs based on the tracking of their effectiveness; and
 A methodology and routine for messaging and more effective communication of the progress of
these programs to the different stakeholders, current and potential.
Meeting today’s needs through Finishing Schools for Near-hires and Continuing Professional Education
(CPE)
Finishing schools and professional training institutes should be considered part of the Education sector
and should be brought into the loop as often as necessary when the tripartite partnership of industry,
government and the academe decide on solutions for the talent development challenges of the
industry. There will be greater interest from entrepreneurs if only some of their informational
requirements can be met by the industry, such as:
a. The extent of training being obtained from abroad

Where there is enough demand from several companies then entrepreneurs can decide either
to develop their own courses or arrange to bring trainers into the country instead.
b. Skills and career maps

Skills and career maps consolidated and published by organizations such as IBPAP can provide
training companies a view of where to invest.
c. Tactical concerns
Through regular dialog with IBPAP and other industry organizations, entrepreneurial training
companies can provide stop-gap solutions, anywhere from office productivity training to
language skills to training on emerging IT applications.

Workforce development is a key driver of retention in the CSS given the wide spectrum of talent
requirements and the prevalence of professional and technical roles. The IBPAP tagline for the IT-BPM
industry—Work abroad, Live here—rings especially true for the CSS. Finishing school and CPE institutes
should be part of the brand proposition of the CSS of meritocracy and professionalism. The talent sought
after by the CSS typically looks at the training as a key benefit of employment.
Finally, scalability of these trainings is an important concern. A purposeful review of the best way to
deliver each type of short-term or corrective training should be performed, i.e., online and web-based
delivery, public courses where cross-disciplinary interaction can occur, or in-house training where
context and domain knowledge will need to be built upon.
Employability skills in secondary and tertiary education
Many of the concerns of the CSS can be considered fundamental and may be best addressed as part of
the improvements sought after in secondary and/or tertiary education:
 Relating to English proficiency, how the tide of “Taglish” (i.e., Tagalog-English) may be held back;
 How to tailor the programs to Gen Y so that the additional content envisaged does not become
an exercise to cram more information, but instead become an exercise to instill behavior and
values.
Significance of the Next Wave Cities™ Program
The interest of the CSS companies in the Next Wave Cities™ program is unmistakable. The rapid
appreciation of the Philippine peso is threatening to make the local service providers pricey and
uncompetitive. The Next Wave Cities™ offers perhaps the opportunity to manage costs down. It is noted
that there are companies that have established their principal location in Metro Manila, and others find
the option of a second site in a Next Wave City appealing for purposes of risk and workload balancing.
Real estate and facilities management companies continue to offer advice to potential locators as these
are guided by the assessments made either on their own or other third party sources. Nevertheless,
efforts to continue to develop and promote the Next Wave Cities™ will continue, noting the program’s
potential to distribute the economic benefits of the BPO industry across a wider geographical base and
achieve a more balanced economic growth.

VII. Conclusion
In February 2012 CLSA Asia-Pacific Markets reported that the Philippines is undergoing a renaissance
characterized by political stability, rising business confidence, low interest rates, a robust fiscal position
and long-term demographic opportunities. All these are expected to lead to a major investment cycle
last seen 15 years ago.22 On top of the huge remittances from overseas Filipinos, CLSA said the country
could now count on other major growth drivers:
 Driven by the IT-BPM industry, the service sector will continue to grow underpinning rising
employment and per capita spend;
 As the country approaches a demographic “sweet spot” in 2015, the country’s middle class will
represent a fifth of the Philippines’ population; and
 Tourism and gaming are forecasted to grow at double-digit rates.
This ostensible Philippine renaissance is occurring even as the aging of the global population is leading
to a talent shortage for most multinational businesses. The opportunities are heartening but that these
will translate to the eventual attainment of the accelerated target of 1.3 million new jobs in Road Map
2016 is far from assured. New methods, new approaches and perspectives, and new technologies are in
order. Indeed, the Philippines is in the midst of a strategic inflection point that, to paraphrase Intel co-
founder Andy Grove, should compel us to change the very way we think and act.23 A strategic inflection
point is when the balance of forces shifts from the old structure of doing business and the old ways of
competing, to the new.24 A Corporate Services Segment strategic growth plan is essential and should
introduce profound change that will foster transition out of the contact-center centricity of the IT-BPM
industry.
NEXT STEPS
The activities undertaken by the project have identified a wide array of activities that can be initiated
even as the CSS organizes to formulate its next steps.
Some of the initiatives can be undertaken individually by market participants and stakeholders and do
not necessarily require collaborative effort, e.g., the pursuit of specific niches such as those suggested in
the sidebars to this report (XBRL, business domain modelling, etc.).
Other initiatives will require coordinated action. The government and the private sector must
successfully partner in order to properly nurture and grow the talent pipeline and to assist and guide the
22
Doris Dumlao, “CLSA believes Phl economy heading toward high-growth path”, Philippine Daily Inquirer, March 1, 2012,
http://goodnewspilipinas.com/2012/03/01/clsa-believes-phl-economy-heading-toward-high-growth-path/.
23
http://www.investopedia.com/terms/i/inflectionpoint.asp#ixzz2IRXn8BUi.
24
http://www.vedpuriswar.org/book_review/only_the_paranoid_survive.pdf.

Next Wave Cities™ to become viable destinations for IT-BPM operations. This will not only disperse the
economic benefits of the growth of the industry, it may also ease the wage pressures in the existing
hubs and mitigate the effects of a strengthening Philippine Peso.
It will be useful to try to assemble the many initiatives in an Urgency-Importance Matrix similar to Figure
16 (perhaps in a new workshop called for this purpose) in order to focus on the activities that have the
biggest impact at the soonest possible time and with the least possible investment (resourcing being
represented by the size of the ovals in the Figure).25While Figure 18 was prepared solely for illustrative
purposes, a number of views nonetheless can be gathered from it:
1. Important initiatives like adopting global best practices on the development of industry
standards and metrics, curriculum redesign and the publication of industry data (particularly
regarding the labor market) will have enormous impact at a relatively low cost.
2. TESDA near-hire courses and AdEPT should be ramped up: the incremental benefit per peso of
investment in these programs is higher than, say, in physical infrastructure.
Figure 18 Urgency-Importance Matrix for CSS Initiatives
Existing talent development programs must be fine-tuned and updated to better address the rapidly
evolving offshore services environment. To this end, program accountability must be clearly defined and
25
The initiatives in the upper right quadrant of the matrix represent the most critical activities. The initiatives in the lower right quadrant may not presently demand
attention but nevertheless represent important goals. While the initiatives on the upper left quadrant should be pursued, it is important that these do not
monopolize attention away from the critical and the important proposals.

better metrics developed in order to ensure proper tracking of program performance and allow a
constant re-examination of plans and programs. There are specific proposals that can gain traction with
a joint push from DOST-ICTO and IBPAP:
1. Initiate discussions to define collaboration programs with other outsourcing nations;
2. Focusing government and industry marketing efforts on established multinational consumer

companies in the Philippines to set up their respective GICs;
3. Define and communicate a strategy for moving up the value chain (for instance, establishing the
country as the preferred location for GICs);
4. Promote the sharing of best practices among the Next Wave Cities™ for their integrative
responsibility in bringing together schools, the community and other stakeholders in developing
their ecosystem to support IT-BPM investments.
The inescapable conclusion is that the Philippines has tremendous potential to capture a larger share of
the Corporate Services Segment of the global IT-BPM industry. A unique combination of trainability,
technical skills, communication skills, and interpersonal skills makes the Filipino ideally suited to the
work. The City of London Investment Group PLC, a US$4.5-billiondollar investment management fund
that specializes in emerging markets, has given a bold prognosis that best describes the strategic
inflection point at which the country is situated.
In its 4th Quarter 2012 Emerging Markets report, City of London declares that “within the ASEAN group
of countries, the Philippines is shaping up to become one of the most exciting medium-to-long-term
growth stories, with huge potential for catch-up with more advanced economies, such as Singapore and
Malaysia.”26 [Italics eds.]
The Corporate Services strategic growth plan will be a key navigational tool for CS businesses to manage
this transition to upcoming modalities and adjust to emerging trends. In doing so, it will enable the
Philippines preserve its lofty position in the global business process outsourcing industry.
26
Emerging Markets Macroeconomic Outlook, City of London Investment Management Company Ltd., October
2012,http://www.citlon.com/special_reports/MacroQ.pdf

____________________________________________________
This study is based on anecdotal evidence culled from the views

presented by the CSS companies through the Industry Survey,
the Focus Group Discussions and the Culminating Workshop
supplemented by secondary data rather than firm and direct
statistical data.
Despite the challenges of driving voluntary participation during

traditionally hectic periods in the IT-BPM calendar, the IBPAP
team was able to muster enough of the industry brain trust so
that lively discussions ensued and valuable insights were
gleaned from the sessions.
The Study Team is hopeful that the results of this effort will drive
strategic initiatives that, in turn, will produce sustainable, long-
lasting benefits for the stakeholders in the Corporate Services
Segment, the IT-BPM industry as a whole, and the country at
large.
The Project Team:

Patricia May M. Abejo, Director, DOST-ICTO
Gillian Joyce G. Virata, Senior Executive Director, IBPAP
Caesar O. V. Parlade, Practice Director, Integris Offshore Business Solutions
George R. Francisco, Consultant, Integris Offshore Business Solutions
Carolyn P. Echavez, DOST-ICTO
Indu V. Badlani, IBPAP
Alexis L. Chua, Integris Offshore Business Solutions

Contacts
Caesar O. V. Parlade
Vice Chairman & Practice Director
Integris Offshore Business Solutions
cparlade@integris.ph
George R. Francisco
Consultant
Integris Offshore Business Solutions
grfrancisco@integris.ph
Patricia May M. Abejo

Director
Department of Science and Technology-
Information and Communications Technology Office
patricia.abejo@icto.dost.gov.ph
Gillian Joyce G. Virata

Senior Executive Director
Information Technology and Business Process Association of the Philippines
gigivirata@ibpap.org

VIII. Appendix 1 – Survey, Focus Group Discussion and Workshop
Participants
The Project Team would like to express their appreciation to the following who participated in the
Survey, FGD and Workshop conducted and held during the months of September, October and
November 2012. The participants include:
Accenture Canlas, Neil

Alexander Mann BPO Ltd. Salipsip, Dennis
Amdatex Osias Jr., Mandy
BPO International Mapua, Victoria
Citigroup Technology Infrastructure Africa, Jose
Deutsche Knowledge
Aquino, Jojo
Services Pte. Ltd.
DSM Manila Ventura , Franchot
Globe Telecoms Velasco, Gedwin
IBM Global Process Services Mirasol , Carina
Integris Offshore Business Solutions, Inc. Chua , Alexis
Logica Soriano, Charles
P&A Grant Thornton Dizon, Gonzalo Benedicto
Dy, Melanie
Ramon, Maryll San
Maceda, Jorj
Carpio, Jessie C.
Wells Fargo Philippines Solutions, Inc. Caldwell, David

IX. Appendix 2 - List of Figures
Page
Figure 1. The Philippines is mature IT-BPM location 13
Figure 2. The programs of the DOST-ICTO for the IT-BPM industry 16
Figure 3. The Next Wave CitiesTM 17
Figure 4. The goals of the IT-BPM Strategic growth plan 2016 21
Figure 5. The IT-BPM initiatives being orchestrated by IBPAP 22
to achieve US$25 billion in revenues
Figure 6. A widening talent supply gap will accelerate cost and quality pressures 23
Figure 7. IBPAP Talent Development Programs 24
Figure 8. Profile of survey participants by business model 28
Figure 9. Offshore Services Value Chain 29
Figure 10. Profile of Survey Participants by Services Offered 30
Figure 11. The significance of location decision factors 31
Figure 12. Issues that can lead to business discontinuance or downsizing 32
Figure 13. Factors that impact the outlook of operations 33
Figure 14. Elements of strategy in the CSS study 34
Figure 15. Year on Year Attrition Rate in Asia Pacific 37
Figure 16. Areas of employability skills 38
Figure 17. Sample metrics chart for an F&A company 46
Figure 18. Urgency-Importance Matrix for CSS Initiatives 50

X. Appendix 3 – A Postscript Report to the Preliminary Study for
the Corporate Services Segment of the IT-BPM Industry
There were many significant economic, social, and political developments in the short
period from the conclusion of the Preliminary Study for the Corporate Services Segment
of the IT-BPM Industry (Preliminary Study or Study). An additional activity was
undertaken in April 2013 with some GICs where the following were discussed:
1. The anxiety about the “Fiscal Cliff” and the debt ceiling negotiations had subsided and it was
clear that a slow, structural recovery for the United States was underway. Cautious consumer
spending and business investment as well as moderate labor market growth would characterize
the short-term economic performance of the world’s premier developed economy. Conditions
were rife for domestic sourcing to take off.
2. The US$13 billion partial bail-out of Cyprus highlighted the reality that Germany and the other
northern European countries had still not curbed the economic free-fall of their southern
European counterparts and that nervousness over the Euro would linger. European companies
were expected to explore back-sourcing to Central and Eastern European countries that are
already members of the European Union—notably Poland, the Czech Republic, and Slovakia. The
labor costs in these countries were already comparatively lower than China’s, especially for
certain high-value skills.
3. Despite the consensus in the last few years of India becoming the next global superpower, it
nevertheless saw its appeal as an outsourcing location continue to wane as global companies
discover the strategic niches of talent in a growing number of emergent outsourcing locations.
Recent adverse economic developments including lower GDP growth, consumer inflation, fiscal
imbalances, and bureaucratic corruption also tarnished India’s image. In response to stiffer
competition in outsourcing services and also to promote the lagging growth its manufacturing
sector, India quietly adopted a policy of “preferential market access,” essentially mandating that
half of all government procurement of computer hardware come from domestic sources. The
Central Government also offered US$2.7 billion in incentives to promote the development of a
domestic semi-conductor manufacturing industry.
4. The Philippines received an early credit rating upgrade from Fitch Ratings, providing further
support for an already strong Philippine peso. A 36% drop in the value of electronic product
exports cut export earnings by almost 16%, a reversal that was deeper than what was
experienced by all our other Asian neighbors and it highlighted the sensitivity of the electronics
industry to currency trends. Because of this, economic growth was again expected to draw
strength from buoyant private consumption and government spending. Although the Aquino
administration was updating the Philippine Development Plan: 20112016 to ensure
sustainability and inclusiveness of economic growth, the continued reliance on remittances of
OFWs and the growth of the IT-BPM industry as pillars of economic performance would
continue to be the dominant features of the Philippine economy in 2013.

Against this backdrop of rapid economic changes, a number of global in-house centers or GICs were
invited to a presentation on the findings of the Preliminary Study to confirm the continued validity of
the observations and the continued applicability of the recommendations, particularly the Talent
Development Strategy Framework it proposes for an envisioned Corporate Services Segment Strategic
growth plan within a national IT-BPM strategy. The participants to this presentation cum feedback
session are listed in Annex A to this Postscript Report.
It was no surprise that the comments to the Preliminary Study focused primarily on the issues relating to
the talent and skills gap in the local labor market that are perceived as obstacles to both the growth and
the sustainability of the industry. Overall, the response to the study was positive with comments on the
depth of the secondary research that supported the survey, the focus group discussions, the workshop,
and on the presentation of insights and ideas that are pertinent to the key issues facing the Corporate
Services Segment.
The discussions touched on many of the points raised in the Preliminary Study, to wit:
 The improvement in employability skills of graduates was a major need. Industry programs
could be organized according to the C&L Employability Skills quadrants to allow companies to
systematically assess and improve the attributes of graduates prior to investment in technical
skills training.
 The importance of updating professional standards and introducing these to the Academe was
stressed. A case in point was the lack of training in the State Universities and Colleges on the use
of enterprise resource management software. IBPAP and respective councils, together with
industry members had a significant role to play in proposing standards to Academe.
 The crucial importance of branding and the need to address wrong perceptions about the
industry was a major concern. Captive service centers were particularly well-positioned to offset
the stigma of associated with contact centers, particularly with regard to lending their brand
identities to create an awareness of the wealth of career opportunities in the IT-BPM industry.
There were a number of observations that may need further exploration before the Final Corporate
Services Strategic growth plan could be crafted:
 One comment was that the biggest value added from talent development programs is in the
cultivation of leadership skills, specifically the perceived cultural predisposition of Filipinos
against speaking out.
 There was a suggestion regarding the establishment of a shared, non-profit Training Center to
serve the common needs of the individual companies in the BPO Industry – a practice that is
typical within the industry guilds in Europe.
 It would be useful to have documented case studies that would trumpet success stories of
companies/locators in the Next Wave Cities™.
 Given the significance of the role of GICs, there may be a need to discuss further the formation
of a Council that will address the CSS’s specific concerns. The assistance of IBPAP would be
invaluable in this regard.

There was a seeming contradiction in the observations of some participants:
 One remark was that scope of the government support, particularly in the areas of incentives
and legal and policy framework, needed to extend appreciably beyond what the Study suggests;
 Another observation was that the multinational captives do have the ability to cope with the
current issues and that the key contribution to be expected of government was only in the
articulation of professional qualification standards.
The outwardly contrary views could be explained by the wide assortment of the service offerings of the
companies expediently grouped together as the Corporate Services Segment as well as the companies’
varying maturity levels in service management. This diversity brought to fore the challenge in devising a
single strategy that would prove beneficial to all industry players.
The good news was that the study sowed many seeds of ideas that might be nurtured to serve as leaven
for the formulation of a coherent strategy. IBPAP shared the recent initiatives on SMP partnership with
CHED and TESDA on near-hire programs, and invited the participating service centers to join the
IBPAP/Talent Development Council.
There was a broad consensus that more active participation and commitment of industry players is
needed, preferably within the ambit of a formal Shared Services Council but also within the different
working committees of the IBPAP. As a final note, it was suggested to follow through on the Preliminary
Study through with another workshop aimed to reach a consensus in respect of the focus, programs,
and strategic direction for corporate services segment.

List of Participants
Accenture Philippines Canlas, Neil

Baker & Mackenzie LLP Timp, Joeri
Chevron Holdings (Philippines) Hong, Kee Teek
Citibank, N.A. Africa, Jose
Sy, Catherine
DSM Manila LLC De Vera, Lenard
Galutera, Mark
Integris Offshore Business Parlade, Caesar
Solutions
Francisco, George
Johnson & Johnson Nuqui, Homer
Macquarie Group Narciso, Raul
Manulife Business Processing Mantaring, Gigi
Services
Punongbayan & Araullo Apostol, Marites
Dizon, Benedicto
Shell Business Service Centre Paraso, Noel
Wells Fargo Philippines La’O, Paolo
Solutions, Inc.
IBPAP Batungbacal-de Venecia, Karen
Bongato, Penny
Hernandez, Benedict
Peña, Ana
DOST-ICTO Abejo, Patricia
Ibrahim, Monchito

XI. Appendix 4 – About the Publishers
Department of Science and Technology –
Information and Communications Technology Office (DOST-ICTO)
Undersecretary Louis Napoleon C. Casambre, Executive Director
The Information and Communications Technology Office (ICTO) is a government agency under the
policy, technical and administrative supervision of the Department of Science and Technology (DOST). It
is tasked to lead and harmonize initiatives on ICT using a multi-stakeholder approach. Its primary thrusts
include ICT industry development, eGovernment, ICT policy development, Internet for all and
Cybersecurity.
In the area of ICT industry development, the DOST-ICTO is tasked to formulate, recommend and
implement an appropriate policy and program framework that will promote the rapid development and
improved global competitiveness of the country’s ICT industry, including the IT-BPM industry. Towards
this end, the DOST-ICTO implements and coordinates strategic and targeted programs in the areas of
industry capability development, marketing and research, and workforce development for said industry.
The programs will also support the national government’s objectives of sustained economic
development through the generation of investments and creation of jobs from the ICT industry.
Information Technology and Business Process Association of the Philippines (IBPAP)

Danilo R. Reyes, Chairman
Jose Mari P. Mercado, President and CEO
The Information Technology and Business Process Association of the Philippines (IBPAP), formerly the
Business Processing Association of the Philippines (BPAP), is the enabling association for the IT-BPM
industry in the Philippines. IBPAP serves as the one-stop information and advocacy gateway for the
industry. With approximately 300 industry and support-industry members, including five associations—
the Animation Council of the Philippines, Inc., Contact Center Association of the Philippines, Game
Developers Association of the Philippines, Healthcare Information Management Outsourcing Association
of the Philippines, and the Philippine Software Industry Association—IBPAP plays a pivotal role in
sustaining rapid growth of the IT-BPM and GIC industry by working to ensure an enduring supply of high-
quality labor, supporting service innovation, and providing country visibility.
IBPAP assists investors in setting up operations easily and quickly in the Philippines. Relevant research,
introductions to key government and industry officials, and a series of briefings at each step of the
investment process ensure a seamless development process. Ongoing support is provided through a
wide variety of initiatives, including programs for HR development, business development, knowledge
sharing and networking opportunities.
Disclaimer:
The views and opinions presented and expressed herein are those of the authors and do not necessarily reflect and represent the official position
of the DOST-ICTO and IBPAP.

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Preliminary Study for the

Corporate Services Segment

Published in December 2013 by the

With the support of the

BPO Business process outsourcing

BSP Bangko Sentral ng Pilipinas (Central Bank of the Philippines) [www.bsp.gov.ph]

CCAP Contact Center Association of the Philippines [www.ccaponline.org]

COSO Committee of Sponsoring Organizations of the Treadway Commission, a joint initiative

EMEA Europe, the Middle East, and Africa

F&A Finance and accounting

FDI Foreign direct investment

HEI Higher education institution

HIMOAP Healthcare Information Management Outsourcing Association of the Philippines

IBM International Business Machines Corporation

Preliminary Study for the Corporate Services Segment 2

ICT Information and communications technology

IT-BPM Information technology and business process management

KPO Knowledge process outsourcing: the outsourcing of core, information-related business

LGU Local government unit

NEDA National Economic and Development Authority: the Philippines’ economic

PFRS Philippine financial reporting standards

PDP 2011– Philippine Development Plan 2011–2016 [http://devplan.neda.gov.ph/]

Preliminary Study for the Corporate Services Segment 3

Preliminary Study for the Corporate Services Segment 4

Commonly Used Terms and Acronyms ____________________________________________ 2

Executive Summary ___________________________________________________________ 6

II. Global Trends in Outsourcing and Offshoring __________________________________ 9

III. Public-Private Partnership in Developing the ICT industry _______________________ 14

IV. The IBPAP Programs _____________________________________________________ 21

VI. CSS Workshop Findings and Recommendations _______________________________ 34

VII. Conclusion _____________________________________________________________ 49

IX. Appendix 2 – List of Figures ______________________________________________ 565

Segment of the IT-BPM Industry ____________________________________________ 56

XI. Appendix 4 – About the Publishers __________________________________________ 60

Preliminary Study for the Corporate Services Segment 5

Preliminary Study for the Corporate Services Segment 6

Preliminary Study for the Corporate Services Segment 7

Preliminary Study for the Corporate Services Segment 8

 Maturing offshoring solutions

 Clients are becoming more sophisticated, meticulous and demanding1

o Some work that used to be outsourced is coming back in-house

o Fewer long-term deals are being closed.

 The weakest growth in offshoring continues to be in Europe

 Broadening offshore delivery network and nearshoring

Preliminary Study for the Corporate Services Segment 9

 New methods of control, Editors Notes

Preliminary Study for the Corporate Services Segment 10

WORKSHOP DISCUSSIONS ON GLOBAL OUTSOURCING TRENDS

 The labor force as consumers

Preliminary Study for the Corporate Services Segment 11

 Moving up the value chain

 Selling niche services

Preliminary Study for the Corporate Services Segment 12

Preliminary Study for the Corporate Services Segment 13

 transparent government and efficient services delivery

 internet access for the entire populace

 investments toward achieving widespread digital literacy

 ICT industry and business innovation for national development

Preliminary Study for the Corporate Services Segment 14

Figure 1: The Philippines is a mature IT-BPM location

Preliminary Study for the Corporate Services Segment 15

THE CSS AS ONE OF THE HIGH-GROWTH SEGMENTS OF THE IT-BPM INDUSTRY

ONGOING PROGRAMS FOR THE IT-BPM INDUSTRY