The Philippine Advantage in IT-BPM
Jomari Mercado President & CEO, IBPAP October 17, 2014
Philippine IT-BPM industry size
20062013; US$ billion x% YoY Growth
1Philippines IT-BPM market as percentage of global offshore services market, in revenue terms Sources: BPAP, ACPI, CCAP, GDAP, HIMOAP, PSIA
# FTEs
(~000) 236 371 424 527
Global
share1 5% 6% 6% 7% 8%
3.44.5
6.17.1
8.9
11.0
13.2
16.1
2006 2007 2008 2009 2010 2011 2012 2013
34% 17%
25%
24%
Copyright 2012: BPAP. All rights reserved.
FTEs Revenue
(US$M)
Rev %
inc.
fr 12
Voice BPO 586,000 10,000 15%
Non-voice
BPO/KPO
169,818 2,915 18%
ITO 71,196 1,767 52%
Health Info
Mgt & Care
65,895 988 114%
Engineering
Services
11,920 216 5%
Animation 9,200 132 0%
Game
Development
3,500 50 0%
TOTAL FTEs 917,529 16,067 22%
19%
298 640
9.5%
777
Philippines 2013 Performance
31% 45%
10.4%
22%
917
11%
1
by the numbers
O n e M i l l i o n
2
IBPAP, Tholons Analysis
Advantage Vision
Annual Graduate Output (000) Graduate Output of Global IT BPM Locations
Tholons Analysis
Advantage Talent
~300k employed outside of Metro Manila ~150k employed in 3 Centers of Excellence Domestic Growth + Impact Sourcing pushing up employment in Next Wave Cities
IBPAP, ICTO, Tholons Analysis
Advantage Scale
Indexed Operating Costs per FTE per Annum (BPM Market Range)
Tholons Analysis
Advantage Cost
7
Impact on the Philippine Economy
Note: GDP at current prices
Source: Philippine Statistical Authority (PSA); BSP; DOLE-BLES; team analysis
Total Exports
USD billions
Employment contribution
Million jobs
97.6%
2.4%
98.8
2005
94%
6%
272.0
2013
100% =
95%
5%
47.5
2005
79%
21%
76.0
2013
100% =
GDP
USD billions
IT-BPM industry contributed
6% to total Philippine GDP
in 2013
Industrys 21% CAGR for 8 years exceeded 6% CAGR of total
exports for the same period
The IT-BPM industry contributed
16% to annual increases in total
no. of employed individuals for the
past four years
88%
12%
1.1
2005-06
84%
16%
3.1
2010-2013
100% =
Others
IT-BPM
* Based on consumption of average Filipino family; savings of 80th and 90th percentile
Source: National Statistics Office; team analysis
~USD6.7 billion annual salaries
and benefits
Housing Savings
Others
34 million Bench jeans
6.7 million iPods
USD1,340 million
Investments Financial institutions
USD1,000 million
90,000 middle-class houses
USD670 million
Food
1.7 billion Chickenjoy meals
1 billion Big Mac meals
USD2,000 million
Taxes
USD1,340 million
1 million classrooms 7 billion days of
nutrition program
1.7 billion jeepney rides
34 million P500 prepaid cards
USD335 million
Second-order Effects from Direct Employment
Transporta- tion and Commu-
nications
30%
10% 5% 20%
15%
20%
8
Success Stories
9
Success Stories
10
Facing the Challenges
Middle management availability and experience
Niche skills, ie investment banking Growth of tourism industry Change of leadership in 2016 Changing policies and regulations Growth outside Metro Manila Emergence of other countries Rise of new technologies Impact of ASEAN integration
11
The Road to 2020
13
by the numbers
growth
1.3 m i l I i o n direct employment by 2016
14
by the numbers
US$
b i l l i o n 2016 IT-BPM Revenue
15
Thank
you!!
16
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