The Pros and Cons of Outsourcing to the Philippines Versus India
30 Jun

By Claire Ponsaran | Posted on June 30, 2017 at 7:12 AM 0 Comments

In spite of Trump's protectionist stance, the outsourcing industry in the Philippines continues to thrive, effectively posing a threat to India's positioning as the top destination for IT-BPO outsourcing. In the global outsourcing index that Tholons annually publishes, four cities in India are always at the top of the list of dynamic cities.

On that same list, Manila has seen its position move from third in 2013 to second in 2015, and lately, down to fourth. But, the Philippines will not lose out to India that easily.

Companies in India have been terminating underperforming employees and letting more of their people go because of automation and redundancy. If this trend continues, 175,000 to 200,000 employees would lose their jobs each year for the next three years, according to a headhunter firm in India.

More importantly, the quality of tech workers in India have been decreasing. A study by employability assessment company, Aspiring Minds, revealed that 95 per cent of engineers in the country are not fit to take up software development jobs. Moreover, Indian workers in customer support positions have shown abysmal performance in language and customer handling skills, areas in which Filipinos excel.

Knowing all these, which country do you think is in the best position to help you achieve your business goals? Would you outsource to the Philippines rather than India? To help you decide, here are several comparisons we've made between the two countries.

#1 Hands down, the Philippines wins the battle of English fluency and diction.

It's true many college-educated Indians have been exposed to British English by virtue of being born among the higher castes. Those who watch Hollywood movies and listen to Billboard hits are likely to speak English with a less defined accent. It's not even noticeable for those who traveled to other countries and lived for a few days or weeks in English-speaking countries.

But, the accent reduction training process for the less fortunate ones back in India can be agonizing. A lot of Indians have deeply ingrained accents because of the various dialects they speak. It's difficult for them to get rid of those accents.

For Filipinos, speaking in English is not that hard. Their accents (if they did have one) are not as distinctive as the Indians. They may flatten their vowels and sharpen the consonants. Thus, there's little difference between 'cat' and 'cut' for Filipinos. But, this is easily fixed through rigorous language training.

Based on various surveys, the Philippines is anywhere from the third to the sixth country in the world with the largest English-speaking population. We can't claim to be native English speakers as much as we would like to, but our talent pool can speak, read and write in this language even at a rudimentary level.

By the time they're finished with training, Filipinos would have adopted a General American accent that does not have a conspicuous regional affiliation.

#2 Overall literacy rate for the Philippines is 96.3% while India only has 72.1% of the population reported as literate by UNESCO.

UNESCO reported that more Filipinos aged 15 and over are able to read, write, spell, listen and speak compared to the same demographic group in India. Moreover, the Commission on Higher Education (CHED) in the Philippines has been working with the Business Process Outsourcing Association (BPAP) since 2011 in providing courses that will better prepare graduates for jobs in the IT-BPO industry.

#3 Filipino culture has traits and values that fit the needs of customers in Western countries while Indian culture has difficulty fitting in.

India's culture is deeply entrenched in ritualistic and traditional practices. Some Indians who came from rural areas and sought jobs in call centers may find many aspects of Western culture as shocking. But, Filipinos don't have that problem.

Filipino children grew up watching 'Sesame Street' in the US and now 'Hi-5' from Australia. Teenagers grew to love American TV shows like 'Gossip Girl', 'Pretty Little Liars' and 'The Vampire Diaries', among others. They read novels written by American and British authors, such as Stephen King and JK Rowling. It's no surprise, therefore, for businesses that outsource to find Filipino outsourcing staff who can easily converse with customers.

#4 Filipinos are more creative in solving problems compared to Indians.

Indians are too focused on following the rules and rarely stray from what they were taught. Meanwhile, Filipinos are taught to think of solutions to scenario-based problems. Although Filipinos commonly do not display exemplary critical thinking skills, they're encouraged to think outside of the box and break a few rules to resolve a problem. In this sense, they tend to disrupt the status quo and be more innovative at work.

While Indians tend to overpromise but underdeliver, Filipinos are too humble to brag about their skills and achievements. That's why business owners and staffing managers prefer to outsource to the Philippines. They know Filipinos can do the job well even though they may say they knew a little bit of this or that.

So, if you're thinking about outsourcing, where would you go to find a service provider? Both countries provide low-cost labor, and each has its strengths and weaknesses. For jobs that require rigidity and precision of procedure, you may choose India, but for creative work and emotional labor, the Philippines is where you can find the best people to hire for customer support, web design, animation, healthcare services, and back-office support.


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Tags: Outsourcing Destination, Outsourcing to the Philippines, Filipino Outsourcing Staff

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