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What are the Pros & Cons with outsourcing to the Philippines?

What are the Pros & Cons with outsourcing to the Philippines?

Pros

  • Exceptional understanding of western culture

    After the Americans rescued the Philippines from the Japanese in World War II, The Filipinos have embraced and adapted the American culture in their way of life. English is a primary subject in their education system. A huge part of advertising, Television and business in the Philippines is done in English.

  • American accent

    The strong American influence has wired Filipinos to speak with an American accent. Unlike India, South America and other parts of the world, Americans prefer speaking to a Filipino because of the accent.

  • Low cost of labor

    Unfortunately, the Philippine economy has limited hope to rebound anytime soon because of the corrupt government. In the past decade two former presidents have been charged with corruption and are still under investigation. This greatly affects the dollar exchange rate. Currently, the US Dollar to Peso conversion is at P43.00 to $1.00. Organizations looking to outsource and offshore to the Philippines can save up to 70% in their labor costs.

  • Exceptional talent & lenient recruitment laws

    The top outsourcing companies in the Philippines only hire candidates with college degrees. Also, the recruitment process in the Philippines is very lenient. Unlike the US, Employers in the Philippines can ask candidates to take IQ exams, qualify candidates based on age, gender & marital status.

  • Next Gen IT infrastructure

    The Philippines IT infrastructure is at par with that of Japan, South Korea and Hong Kong. With multiple established internet service providers providing high speed fiber optic connection across the country. Technology companies such as Cisco & Avaya have local offices in Manila offering expert data and networking solutions for outsourcing companies.

Cons

  • The weather

    Annually and average of 12 tropical cyclones (typhoons) blanket the Philippines causing floods and cancelation of work and school in certain areas directly affected by the typhoons path.

  • Holidays

    Compared to the US (11 official holidays), the Philippines has a total of 18 official non working government & religious holidays. With 85% of the Philippine population being catholic, Holy week is the longest break period in the country.

  • Pro employee labor code

    The Philippine labor code greatly favors the employee. An Employer cannot fire an employee at will in the Philippines. Just cause and proper documentation is required to terminate any Philippine Employee. Termination of any employee also requires that the company provide the allocated severance pay.

  • 13th month pay

    The Philippine labor code requires organizations in the Philippines to pay employees an additional 13th month pay annually. This incremental month of payment is paid in December as a mandatory bonus to an organizations employees.

Overall, the Pros out way the Cons when outsourcing to the Philippines. Local outsourcing companies have contingency plans such as disaster recover sites to transfer calls or work when an office is affected by any weather or natural disaster. The incremental holiday pay to have employees come to work is still dramatically cheaper than that in the US and other parts of the world. Established outsourcing companies in the Philippines have developed a streamlined process to terminate problem employees with due process. Even with the 13th month pay, companies looking to outsource to the Philippines can save up to 70% in their operational costs.

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