In Philippines, Fluency Is Key to Affluence of Outsourcing Market

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A number of companies -- including AT&T and Dell -- have taken some pretty public knocks for deterioration in customer service quality after moving tech support to call centers in India.

They are trying to repair the damage by moving these operations to countries that are still lower cost than the U.S. but which offer fluency in English, affinity with American culture and other advantages.

Such locations include Jamaica, Costa Rica and the Philippines.

According to Reuters, outsourcing revenues in the Philippines jumped 50 percent from 2005 to 2006, reaching $3.6 billion.

Dell has a call center there, with plans to add another. Other companies with a presence include Accenture, Convergys, PeopleSupport and eTelecare Global Solutions, an Arizona-based firm that attributes its rapid revenue growth to the fact that about half of its 7,000 workers are located in the Philippines.

The Philippine government says that outsourcing revenues could hit $12.2 billion by 2010, according to the Reuters article. Yet some folks say those projections are hopelessly optimistic.

The executive director of the Business Processing Association of the Philippines, quoted in this Newsweek article, says that just three to five of every 100 call center applicants are fluent enough in English to win a position.

The government is addressing this problem by making English the primary language of instruction in schools and introducing PR initiatives that stress the professional benefits of English fluency.