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Business News/ Brand Post / Call Center India: Losing dominance to the Philippines
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BRAND POST

Call Center India: Losing dominance to the Philippines

There are many nations eager to take advantage of the challenges faced by the world leader. Several developing countries in South America and Africa are growing their call center outsourcing sectors. And even in Europe, many nations are emerging with their own offers.

Business Process Outsourcing (BPO)Premium
Business Process Outsourcing (BPO)

India took an early lead when it came to the offshore Business Process Outsourcing (BPO) industry. The first call centers in India were established in the 1980s, taking advantage of incentives provided by the government and a low-cost English-speaking workforce. The first major investors, GE and American Express, were soon followed by other multinational companies. And, throughout the 1980s and 1990s, it was increasingly likely that any call to a multinational business would terminate in a captive call center in India. The success of these operations, and the attractions they offered to Western businesses looking to lower their operating costs, were not lost on those local staff who were increasingly involved in call center management. And it was not long before the more entrepreneurs among them started their own businesses offering outsourced call center services, opening the market to smaller companies that wanted the benefits, but could not afford to establish their own captive operation in the country.

Between the captive operations and the rapidly growing third-party outsourcing providers, call centers in India became not just a source of revenue and employment for the nation, but a critical part of the national economy. Today, the BPO industry provides an estimated 8% of the country's gross domestic product. “This is no mean feat, since, with a population of 1.4 billion people, India is one of the world's largest economies: on some measures, third only to the USA and China. And in what is now a global industry, India is high on the list of any business looking to offshore its call centers. It has become a globally leading destination for IT, BPO, and KPO," says Ralf Ellspermann, CEO of PITON-Global, an award-winning call center outsourcing provider.

Several factors have helped India retain its position as the outsourcing world leader. Its status as the early mover in the sector means that call centers in India are often the first thing people consider when offshore outsourcing. While those thoughts are not always positive — there was a shaky start to the industry, and the early quality was not always high — it also provided the learning opportunities for the sector to develop. Combined with the size of both the country and the industry, call centers in India had a head-start. However, there are some signs that its dominance is being challenged or changed. India might even be a victim of its own success, and despite the size of the population, outsourcing might be stretching the national resources. The nation has lower literacy rates than competitors such as the Philippines, creating staffing challenges. And with patchy communications infrastructure, outsourcing providers are struggling to find suitable premises as the sector outgrows the well-connected metropolitan areas.

There are many nations eager to take advantage of the challenges faced by the world leader. Several developing countries in South America and Africa are growing their call center outsourcing sectors. And even in Europe, many nations are emerging with their own offers. Perhaps the biggest competitor so far is the Philippines. The country has particularly capitalized on the exceptional levels of English-fluency in the population, meaning call centers there often boast accent less agents. “Consequently, while India remains the world leader for outsourcing generally, more businesses from around the world are now favoring the Philippines for call center outsourcing. With BPO remaining a growth industry, there is plenty of room for competition, but places like the Philippines are now presenting the biggest challenge to call centers in India," says Ellspermann.

 

Disclaimer: This is a company release. No HT journalist is involved in creation of this content.

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Published: 30 Dec 2021, 05:43 PM IST
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