Business and IT services have become a target for the Philippine government. Strengths include a high level of English language proficiency; a consultative, customer-service-oriented workforce; and high-quality, low-cost labor. Weaknesses include low awareness of the Philippines as an offshore contender, lack of experienced operations management teams and migration of workers to the U.S.

Specialty: Call centers, business process outsourcing, animation, application development.

Quality Indicators: High: Cost, cultural compatibility. Medium: Government support, labor pool, infrastructure, educational system, process quality. Low: Legal system, globalization skills.

The Kearny 2004 Attractiveness Index identifies the Philippines as “an established success story” – and with good reason. The Philippines is a small third-world country – but this small country boasts of a powerful and flexible workforce that competes with India and China in terms of low labor cost and high quality turnout.

The general educational background of the labor population is formidable. The Philippines has more students enrolled in universities than most European countries. Every year, the country turns out some 15,000 graduates from technical colleges, from a grand total of 380,000 university graduates.

One other advantage that this particular location has over other outsourcing countries is that it is not “cloistered.” The local media’s openness to influences from various cultures, including American and British cultures, makes for a culturally open society. Many Filipinos are at least bilingual, with the country’s official languages being Filipino and English, and with a majority of the workforce knowing at least one other regional or tribal language in addition! This makes the Philippines one of the world’s top choices for telecommunication projects requiring a high level of language proficiency, not just English.

Foreign investment continues to make an immense contribution to the improvement of the local economy. Knowing full well that the country’s business environment needs to be built up in order to attract more investors, local business organizations work with the government in improving the infrastructure and encouraging the local consultancy efforts. Very recently, the Philippine Ports Authority announced that it is building a new e-procurement system that will make the process of finding and bidding for the services of local consultants easier and more secure.

As recently as February this year, too, the country held a major Outsourcing Fair. BusinessWeek predicts that “by the end of 2005, outsourcing jobs in the Philippines are expected to total 100,000.”