Malaysia BPO Sector Strong in 2H of 2009

According to industry press and speakers at a local conference here in KL, the local shared services outsourcing industry is worth about RM750 million and growing at 30 per cent per year.  The Business Times in Malaysia reports that there are now 600 call centres in the country, employing about 25,000 people.

Infosys BPO deal with T-Mobile

Infosys BPO, the business process outsourcing subsidiary of Infosys Technologies, signed the five year contract with T-Mobile of U.K.

The agreement calls for Infosys BPO to support several core processes for T-Mobile’s finance division which cover customer finance, commercial finance and accounting and procurement operations.

Companies did not disclose the size of the deal.

2009 Call Centers in Malaysia

“Pureplay” call center services (or predominantly voice-based customer support) is becoming less of a focus in 2009 in Malaysia. The market is still growing but the margins are getting smaller. Most are adding more services such as process automation and customer analytics.

2009 Economic Crisis? Not in Philippines BPO Sector

By all accounts, APRG is predicting that the global economic slowdown is having NO impact on Philippines BPO market.

For most BPO companies, executives we interviewed stated  that “demand is still there, and that growth is coming from both new and existing clients”

The outsourcing industry in Philippines looks bright, with growth rate forecasts of 22 to 30 percent in 2009 being publised by the Business Processing Association of the Philippines.

Convergsys Cebu Philippines Expansion

Five years after it started operations in the Philippines, Convergys has opened 12 contact centers in the Philippines:  seven in Metro Manila, three in Cebu City, one in Bacolod City and one in Santa Rosa, Laguna.

On April 4 2009, the newest Convergys BPO facility,  with capacity for 1,000 call center workers, opened in Cebu City, Philippines.

Company spokesman announced in a press release that the global economic slowdown has had minimal impact on the company’s operations. “Convergys is still on track with our growth plan and proof of that is our expansion” and the company could not see any slowdown this year

2009 BPO Outlook in the Philippines

Some bad news from the Philippines these past few weeks:

• About 34,000 jobs in factories throughout the country have been lost due to  shrinking exports to the primary markets of United States and Japan. (NB: The electronics industry  accounts for about 70 percent of Philippine exports and employment of 480,000 workers).

Some good news (but, coming at the expense of American workers) for the Philippines ,

• The BPO  / call center industry expects to create 130,000 jobs in 2009.

It’s also widely thought that Philippines could be in a good position to capture some of the BPO outsourcing business that India lost due to the fraud issues at Satyam.

BPO and the Outsourcing Market in 2009

Couple of thoughts as we start 2009.   While the global economic crisis continues to reach wide and deep, the outlook for the BPO market and Call Centers in Asia is somewhat upbeat (considering all the gloom).  We listened in to some of the recent  analyst briefings and earnings calls by Accenture, IBM, HP, etc,  over the last few days, and here are a few notes: 

• Customers are looking for stability in their service providers. They’re going to look for people that they have confidence  with.  
• They  think the activity in the outsourcing spaces is just going to pick up in a significant  dramatic way 
• Asia Pacific is providing outstanding results, with revenue growth of 22% in US dollars and 25% in local currency
• Clients are turning to outsourcing to meet the demand for rapid cost savings. 
• There is increased interest in BPO with an emphasis on back office cost improvement opportunities.  
• Demand for application outsourcing remained strong. In systems integration and technology, they are seeing increased demand around services to improve IT effectiveness

Happy New Year to all of our readers and clients..s

Philippines for BPO? Makati Rents Increase

Picked up this bit of news on the Manila Real Estate market during the holidays: 

About 502, 000  square meters of new office space is scheduled for completion in 2008 across Metro Manila to address the demand from the growing BPO sector. 

Aside from the effect of the US slowdown, CBRE estimates that demand for office space will get a boost from the Indian companies entering the Philippines. “BPO firms in India are either coming here or they have already have presence here.”

Most BPO firms in the country have established sites in the Makati central business district and Ortigas, which has resulted in increase in rents.

David Leechiu, country head of the global property consulting firm Jones Lang La Salle Leechiu was interviewed in one of the local papers, and stated that “rents in Makati have increased by 20% during the last three years due to huge demand for office space.” 

“The challenge for Makati is particularly acute as tenants (particularly BPO occupiers) lured during 2002-2004 by low rents and a lack of alternatives ( at the time)  now face substantial rental increases at a time when new accommodation options are available in secondary and suburban locations. ”

Citibank to Increase Staff in Philippines BPO in 2009

Citibank plans to expand its Philippines BPO operations and hire 1,000 more workers in the Philippines next year.  As reported in today’s Manila Standard newspaper,  the plans are still in place -  despite the thousands of jobs it plans to cut in the US.   Country Business Manager Mark Jones was quoted as saying  “There’s a whole lot of activity moving in the Philippines as we grow our businesses. Citi is moving more equity in the Philippines. If you look at the business, we’re repositioning globally,” Mr. Jones said.

The new jobs to be created in the Philippines would be for Citigroup’s call center and financial reporting operations.

India’s Essar Buys PeopleSupport

This week we saw Aegis BPO, part of the India Conglomorate Essar Group, is buying offshore BPO provider PeopleSupport, in an all cash deal of $250 million. The combined entity will have 30,000 people and revenues of $500 million, making it India’s biggest BPO after Genpact.

Under the terms of the agreement, Aegis BPO will pay PeopleSupport stockholders $12.25 per share, which represents a premium of about 29% over PeopleSupport’s closing share price on August 1,