IT-BPM sector posts growth in revenue, jobs | Andrea E. San Juan


THE IT and Business Process Management (IT-BPM) sector’s revenues rose 10.6 percent from 2020 levels to $29.49 billion in 2021, eclipsing its recalibrated target for 2022, according to the IT and Business Process Association of the Philippines (IBPAP).

Employment figures in the industry also increased, recording a 9.1-percent growth compared to 2020, the IBPAP said in a statement on Wednesday.

“The number of full-time employees [FTEs] in the country increased by 120,000 in 2021, bringing the sector’s total headcount to 1.44 million and recording a growth of 9.1 percent compared to 2020,” said IBPAP.

Such robust growth in both employment and revenues, according to IBPAP President and CEO Jack Madrid, “validates what we had projected—that 2021 performance was beyond recovery; it marks a resurgence for the Philippine IT-BPM sector.”

Madrid added: “Preserving jobs, driving investments, stimulating countryside development, and creating demand for real estate—these are the unequivocal contributions of the industry to nation-building.”

The IBPAP attributed the growth to pent-up demand from global customers; higher confidence in work-from-home (WFH) setups by clients in contact centers and business process services; and growth in emerging sub-segments like e-commerce, fintech, health care, and technology.

The enabling association for the IT-BPM sector noted that “more and more organizations in global business services [GBS] are also incorporating offshoring and outsourcing into their strategic initiatives to improve efficiencies and optimize costs in multiple geographies.”

As such, the IBPAP chief stressed that this will spill over into 2022 and continue to boost demand for IT-BPM services worldwide. Madrid said, “we should not miss out on this opportunity to capture a bigger slice of the global market.”

However, the sustained growth of the sector will rest on several factors. In the IT-BPM sector’s case, further reliance on offshoring and outsourcing will be driven by next-generation business models and assets.

Addressing talent and skills shortage and competitive pricing models can also be among the factors to consider.

Expansion across select horizontals and verticals and increased digital adoption by traditional players will also be potential drivers of growth in 2022.

Still, the industry stakeholders need to watch out for three things to maximize the country’s growth potential and strengthen its global competitiveness in 2022, industry leaders said.

The IBPAP noted that supply chain resilience from a talent perspective will be critical amid the talent competition that was worsened by higher attrition rates and growing requirements for emerging and niche skills such as automation, cloud, data and analytics, and cyber security.

The second factor to watch out for is the integration of hybrid work models in business strategies. IBPAP emphasized that this will also become more prevalent.

“Globally, 70 percent of IT-BPM enterprises are saying that they will be implementing hybrid work arrangements. Locally, 80 percent of Filipino IT-BPM employees have expressed their preference for a hybrid work model over returning fully onsite,” IBPAP noted.

In fact, government agencies have addressed several concerns on the return-to-office arrangement, as opposed to working from home.

IBPAP said another factor to consider to sustain the growth of the sector is “location adversity” since it has also become a priority after the onslaught of the pandemic.  “Given this, companies will need to leverage off alternative locations and adopt small-scale centers of microsites to achieve more robust business continuity plans [BCPs],” IBPAP emphasized.

Apart from the three watchouts, IBPAP said, the future of the Philippine IT-BPM sector will also depend on the country’s ability to take advantage of emerging trends and bypass mounting threats on a global and local scale.

For the government, the IBPAP recommended aiming for a sustainable talent supply, predictable regulatory environment, and more enabling infrastructure, as these top considerations of potential investors and locators.

The association is set to publish this year the Philippine IT-BPM industry Roadmap 2028—a blueprint for the sector’s priorities in digitization, talent, policy shaping, infrastructure, and country branding over the next six years.

Among these initiatives is the legislation that will enable the long-term implementation of hybrid work given its widespread adoption in competing locations such as India, Poland, and Malaysia. IBPAP highlighted that they have placed this area under the microscope in the last few years, when it proved commendable beyond its initial purpose as a business continuity plan.

IBPAP has been working with the incumbent and incoming governments to discuss the steps needed for a consistent and comprehensive policy on hybrid work and to improve ease of doing business for new investors.

“The launch of the Roadmap is very timely because 2022 is a banner year for the Philippines and the IT-BPM industry. Not only are we welcoming a new administration, but we’re also at the precipice of a new age that will reimagine, rethink, and re-envision everything that we know about the sector,” the IBPAP chief said.

“We are pleased to share that earlier this year, we selected the Everest Group, a renowned global services advisory and research firm with a deep understanding of the global IT-BPM industry, to be our partner in this critical undertaking,” added Madrid.


Read More: IT-BPM sector posts growth in revenue, jobs | Andrea E. San Juan

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