Consulting Industry Insights: Why is India Losing out on BPO Work to the Philippines?

If you’ve been following the outsourcing news as of late, you’ve no doubt heard the rumors that India is losing out on business process outsourcing (BPO) work to the Philippines and Eastern Europe.

The Economic Times reports that India may lose up to $30 billion in voice and call center work over the next decade.

There are several reasons India is losing out on call center work to the Philippines:

1. The Philippines has better infrastructure. As it turns out, much of the telecomm infrastructure was built by the US army during the occupation (unlike India, which is still working on improving their infrastructure).

2. The Philippines has more compatible culture. Filipino workers require less training because of greater similarity to US culture and less accented English.

3. Turnover is lower in the Philippines. At this point, a call center job in the Philippines is more valued than one in India because the wages for a call center job are relatively better.

On the bright side, India is dominant in the high end of BPO work such as application development, and has a much larger potential workforce. Time will tell how it all plays out.

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