Pandemic automation forces Philippine outsourced workers to up their game

10, Sep. 2020

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MANILA, NNA – When the Philippine government imposed strict stay-at-home orders to contain the spread of coronavirus, business process outsourcing companies (BPO) were exempted.

While other sectors were told to make work-from-home arrangements if they were to keep their business open, IT-BPO companies were allowed to continue operating on-site albeit at a much reduced capacity.

Among them was TaskUs, Inc., a US-based outsourcing company which quickly shifted 90 percent of its 15,000 employees to work from their homes. They were provided with desktops, as well as WiFi dongles and broadband for those facing poor connection.

It said most of its employees are still working from home even as the lockdown has mostly eased. Only less than 3 percent of its workers are doing their job onsite.

Jean Lim Parlade, senior vice president of Southeast Asia operations of TaskUs, told NNA, “It was a huge investment but felt that this is the right thing to do for our employees at this critical time.”

Such a work arrangement was made possible through its own work-from-home platform, and the use of virtual desktop infrastructure or virtual machines that manage desktops remotely.

TaskUs said it has been using artificial intelligence and automation to do away with cumbersome manual and repetitive tasks in the past two years, a move that was already happening in the BPO sector way before the pandemic.

The Healthcare Information Management Association of the Philippines (HIMAP), a segment of the IT and Business Process Management (IBPAP), said it has also seen “transformational changes” in the business models of its member companies before the coronavirus crisis.

“The digitalization of information will help analytics develop to new and deeper insights with regard to health care, the use of technology and the evolution of new models in health care delivery and pharmacy, among others,” said Maria Susana de Leon, the executive director of HIMAP.

In a 2018 report, the Asian Development Bank (ADB) said the use of technology was impacting on routine jobs in manufacturing and service sectors.

Sameer Khatiwada, social sector specialist of the Southeast Asia department of ADB, told NNA that the pandemic is likely to hasten the emergence of some of these trends.

Citing robotic process automation (RPA) as an example, he said it has now evolved to more sophisticated rules-based chatbots and cognitive automation from just performing routine and transactional tasks initially.

"There will be an increasing push for RPA adoption. This process will continue as before, but now with a renewed push due to the global pandemic,” he said.

Victoria Alcachupas, business development vice president of TaskUs, also noted the increasing demand for analytics and cloud services in the outsourcing industry.

“The pandemic has accelerated the need for businesses to embrace innovations that are less reliant on legacy infrastructures,” she told NNA.

Rising demand in BPO jobs

Despite the pandemic’s impact on outsourced work, Khatiwada said there has been rising demand for BPO jobs, particularly customer service support because national lockdowns have forced people to rely on various services online.

In June, the Philippine labor department said it expects a “resurgence” of the IT-BPO industry with more companies in Western countries seeking to offshore more jobs to save costs as a result of the global recession.

It said one company would need at least 4,000 jobs to be filled up before September this year.

In fact, the Philippine government is banking on the BPO sector to provide jobs to the thousands of displaced overseas Filipino workers (OFWs).

The sector is seen as so valuable to the Philippine government that it is considered an essential pillar of the economy that needs to survive the fallout from the pandemic.

Khatiwada said the threat of automation has raised worries about the future of job creation in the IT-BPO sector, especially since it is considered as one of the key drivers of the Philippine economy, alongside significant amounts of remittances sent back home from Filipinos working abroad.

BPO services account for 20 percent of the country’s exports and over seven percent of its gross domestic product, while employing 1.3 million workers.

“Considering that the largest share of total BPO jobs comprised of clerical support workers mostly employed in call centers, the changing demand for outsourcing services will have implications for education and skilling initiatives,” he said.

Citing IBPAP’s data, he said middle-skill jobs will increase from 38 percent in 2016 to 46 percent in 2022 of the total BPO employment. For high-skill levels, the number will go up accordingly from 15 percent to 27 percent.

While some routine tasks will disappear due to automation, the 2018 ADB report said more and better jobs will be created. But it will require IT-BPO workers to be better skilled at using new, sophisticated technology.

Renewed push for upskilling

Besides having internet connectivity, improving workers’ skills is equally important for the Philippines if its BPO market were to stay globally competitive especially now that the pandemic has pushed the urgent need for digital adoption.

The Philippine share of the global BPO market currently stands at 13 percent. IBPAP, the organization of IT-BPO companies in the Philippines, has set a target to raise it to 15 percent by 2022.

To adapt to these changes, IBPAP has proposed to upskill and reskill Filipino workers two years ago. It renewed its call again this year as it noted that the use of sophisticated technology in the BPO sector has accelerated.

It is pushing for a national program to upgrade the skills of 1 million Filipinos over a five-year period.

For a start in 2020, IBPAP plans to launch a scaled-down pilot project of the program together with government agencies for 1,000 full-time workers.

The lobby group said the pilot project would provide a proof of concept for its proposed national program. It hopes to replicate similar initiatives for BPO workers in Singapore, Malaysia and India.

Among the top tech skills identified are data analytics, medical coding, software development, six sigma, computer graphics and digital animation.

LinkedIn has highlighted technology related work areas as the leading four emerging jobs in the country in 2020.

In 2016, only 54 percent of the IT-BPO workforce was found to be capable of performing tasks requiring middle-level and high-value work.

With the push to upskill its workers, the industry expects the number to increase to 73 percent or 1.15 million full-time employees by 2022.

For Khatiwada, the Philippines’ BPO industry will remain competitive given what he describes as its inherent strengths that allow the country to capture a large share in the market, such as low-labor cost, large English-speaking population and high literacy rate.

Parlade of TaskUs shares the same view.

“The Philippines offers a promising talent pool and we are projecting that the industry will continue to thrive as the world shifts to the digital space,” she concluded.