As I write this outsourcing market update, it’s impossible not to reflect on how much the outlook for the industry has changed in 12 months. If you had asked me a year ago to suggest where we would be right now, my prediction would have been spectacularly wrong. With a global pandemic fast becoming a reality, our business lost 30% of our revenue in one month and I was experiencing the most stressful period I’d ever been through as a business leader.
Yet here we are 12 months later and the outlook has never been stronger. Who would have thought our real estate clients would be breaking records? Who would have believed the luxury car sector would go from discounting and fighting to clear stock to having advanced orders for six months? As part of our commitment to service, we’ve been doing a lot of client check-ins and the sentiment across the board is overwhelmingly positive.
As an organisation that partners with a cross-section of industries and businesses of all different sizes, we have gained valuable insights into the outlook for 2021 and I can report the majority of our clients are going from strength to strength. From a devastating period where people were losing their jobs and businesses were wondering how they were going to survive, we are now managing high volumes of recruitment in the Philippines as Australian businesses ramp up their activities.
From accountancy and FinTech to our managed services and SaaS clients, we are seeing high demand across all industries. As an example, mortgage broking is up 20% and the demand for loan processors is so great that we have created official training programs to provide pathways for people to immediately enter roles. Whereas a year ago clients were letting staff go, they are now competing to fill roles and secure the best talent available. This is reinforced by new data that shows the Business Process Outsourcing industry’s market size is expected to reach US$405.6 billion by 2027.
As 2021 continues to unfold, the biggest change we’re seeing from businesses is their eyes have been opened to the potential of offshoring. COVID-19 has changed the game, with businesses that were forced into work from home (WFH) arrangements a year ago realising the concept not only works but exploring if it can be done even better offshore. Even some clients who already had staff in the Philippines didn’t fully appreciate the talent available and the scope of work that can be done offshore.
As noted by Forbes: “Despite revenues coming under pressure in 2020, service providers’ bookings for business in 2021 are at record levels” and “the current actions of big tech firms will drive explosive growth in cloud services”2.
We’ve noticed the shift in thinking in our sales conversions, with many businesses that have been in our pipeline for two or more years taking the leap to offshoring. Having seen that remote working environments deliver, they now realise it’s about finding the right person for the role and if that person happens to be a Filipino living in Pampanga who is a more economical hire than one living in Australia, all the better.
As I look at what lies ahead for the industry, WFH solutions will become a permanent part of the landscape. While we previously wouldn’t have committed to WFH long-term, what we have witnessed during COVID-19 means it will be part of our offering moving forward based on suitability of the set up to the clients we engage with.
A huge factor has been businesses embracing the technology and tools they have always had at their disposal. The main thing that has held many organisations back from going on a digital journey is change management. We see it all the time - leaders in the business have bought the tools but when they try to implement them with their teams, they get huge pushback because no one wants change, particularly in process-driven roles.
The need to work remotely during COVID lockdowns meant businesses had to commit to digital tools and they now realise offshoring makes sense because it removes geographical borders and opens up the talent pool. It’s all about offering a perfect mix - a COVID-safe work environment in the office with the business continuity of seamless WFM environments. According to Deloitte, 93% of organisations are considering cloud services and 72% are considering robotic process automation (RPA) solutions to improve the responsiveness of their outsourcing set up and rapidly expand their offering into new markets.
Another offshore trend that will gain momentum this year is the complexity of roles on offer. The industry is evolving and we have seen average wages for offshore staff on the rise. While offshoring used to be about call centres, data entry jobs and basic back office administration, businesses are committed to doing more and that is creating markets for high-level accountancy, financial planning support, web development and CRM development. Smart businesses are building really strong, complex teams offshore to strengthen their onshore operations.
While many clients have emerged from the pain of a year ago stronger than ever, there are those who continue to face an uphill battle and would benefit greatly from additional support. Fortunately, the experiences of the past 12 months mean offshore staff are better placed than ever to deliver for both parties.
At a time when businesses were needing to innovate and find new revenue streams, the team members they retained in the Philippines were also being flexible and embracing new ways of working. Having shown their worth in difficult times, they will increasingly find themselves in more diverse roles than ever because they have proven their ability to adapt to the changing landscape.
So if you are looking for a smarter resourcing strategy, outsourcing is a process that can supercharge businesses of all sizes. If you’re not familiar with the strategy, this eBook covers everything you need to know and will be your ultimate outsourcing guide. We cover topics including:
- What is outsourcing?
- Myths around outsourcing
- Why the Philippines?
- What to expect with outsourcing
- Choosing the right provider.
If you’re unsure how outsourcing could work in your business, download this eBook to learn more about the potential benefits.