THE call center industry in the Philippines is gearing up for a recovery in the third and fourth quarters of the year but for now is recasting its targets as volumes fall and business shifts due to the new coronavirus 2019 disease (COVID-19) pandemic, according to Jojo Uligan, president of the Contact Center Association of the Philippines (CCAP).
As call centers account for bulk of revenues and headcount of the entire information technology-business process management (IT-BPM) business, assumptions on the whole industry roadmap will also have to be revisited, Uligan said.
H Karthik of the Everest Group said the Philippine contact center industry should look for long-term opportunities brought forth the pandemic offered by enterprises and their buyers now rethinking their business by outsourcing more.
Karthik noted the need for the Philippines to accelerate its digitalization as the crisis prompted the adoption of better digital customer experience.
“These would be tough times for BPOs especially contact centers,” he said, adding that capitalizing on the Philippines’ fundamental strength, its talent pool skills, have not gone away but that “they have just changed.”
“You should never let a crisis go to waste,” Karthik said.
But Uligan said CCAP has to make adjustments on revenue and headcount projections based on the effect of COVID-19.
At the start of the year, CCAP set a 4 to 5 percent growth projection for 2020.
“ (COVID) there’s definitely an impact to our growth rate for this year,” he said, adding that CCAP is currently conducting a study on the losses, including opportunity
losses, incurred by its members.
Uligan said the number of employee addition to the industry for the year will also have to be revised. The contact center sector adds 70,000 to 90,000 workers a year.
He said COVID and the ensuring enhanced community quarantine tested the resiliency and agility of the contact center and the entire IT-BPM industry and “we continue to operate under difficult conditions.”
The group, Uligan said, is preparing for the lifting of the lockdown.
With new health protocols that need to be observed, CCAP will adopt what it called a hybrid model where 30 to 35 percent of their workers will have to work at home, depending on the services they offer.
“Working from home is the new normal and the entire industry is preparing to make sure
concerns on infrastructure including telecommunication, are addressed,” Uligan said.
Karthik said compared to the Philippines, India fares better in the work-at-home arrangement in terms of the percentage of workers because of better infrastructure .
But the adjustment of workers on site will not just be on physical distancing.
Karthik said contact centers will now have to ramp up on work that deals with online services like retail, health care and logistics which have seen a surge in demand since the pandemic erupted.
“This is not a silver lining but an opportunity …
but it requires the Philippine (contact center) industry to have a more established working model… This is
where digital platforms and tools come in,” Karthik said.
Karthik said the contact center sector is likely to witness better performance compared to IT services
because work in business process needs to get done whether the economy is in a recession or in a growth phase.
Karthik also noted
historically, growth of the contact center industry is higher than overall economic growth.
“We expect that to remain because recession hits the B2C (business to consumer) more than it does B2B (business to business) and therefore a lot of these activities (in B2B) are essential even in recession. We
expect growth rate of the industry will be higher
than the growth (of the economy,” Karthik said.
Uligan said CCAP expects
growth to pick up in the third and fourth quarters which traditionally are strong periods for contact centers.
“We will bounce back. The first and second quarters are usually slower coming from the of end of the peak season for programs we service. The first quarter of the year was
slow and (demand) picked up in the second quarter,” said Uligan expressing hope to recover lost opportunity in sectors that are growing and where demand for customer relations management is surging.
“On the recovery side,once
the ECQ is lifted we will challenge that,” he said.
Uligan said while some companies saw declines in volumes in terms of number of calls and chats such as those in the airline and hospitality, other businesses had a positive performance like online retail and logistics.
He said CCAP has not received any reports of members shutting down or bringing back their services to their own geographies.
He said CCAP is entertaining expansion and some members are welcoming new logos.
