Plan BPO growth by city, not by country, says official

By Mia A. Aznar

RATHER than plan the business process outsourcing sector’s growth by country, a “city-centric” focus is more ideal, a leader in the industry said.

Jonathan Defensor de Luzuriaga, executive vice president of CIBI Information Inc. and former executive director for industry affairs of the Business Processing Association of the Philippines, said that in choosing an area to outsource their services to, multi-national companies no longer compare by country, but by city.

In comparing cities, he said there are more efficient means to highlight local value propositions. He added that it is also more responsive in decision and implementation capabilities and that there is a greater ability to distance a city from the general image of its country.

De Luzuriaga pointed out that Cebu does not have problems projecting itself as a safe city because it is far from Mindanao and has, so far, not had any serious security issues, unlike some cities in Mindanao.

De Luzuriaga said that Cebu should be less dependent on national marketing because a city-centric approach has more focused marketing and promotion efforts.

This way, cities will also be known for specific services that they provide.

He explained that one-stop shops for outsourcing are no longer the norm in the industry.

In his presentation during a recent forum, de Luzuriaga said that though the demand for BPO is global in nature, clients have consistently required localized and focused development and assessment strategies.

He noted that clients of CIBI, which is a provider of business and personal information, require very specific data from their advisory and location service assessment services.

“Broad, country-level overviews are becoming less relevant in a more focused and competitive landscape,” he said.

For Cebu, he said BPO companies here can compete with Colombo, Sri Lanka in offering knowledge process outsourcing (KPO) services.

Quoting the Business Monitor International Philippines Information Technology Report for the last quarter of 2010, de Luzuriaga said Cebu is estimated to contribute to six percent of the country’s BPO revenue.

The report also said that about 14 percent of BPO employees are employed in Cebu.

Published in the Sun.Star Cebu newspaper on January 18, 2011.