Oscar Sanez runs marathons, which seems appropriate given that he plays a key role in the Philippines long haul to establish itself as a world leader in the global sourcing industry. Currently the President and CEO of BPAP--the Business Processing Association of the Philippines (www.bpap.org)--Oscar brought his youthful energy and appearance to a recent interview with a tired old American journalist who was nearing the end of a two-month tour of Southeast Asia.
We met for coffee in Makati City's Greenbelt area, a showcase neighborhood for a country that often struggles with an image of natural and political disaster. I had just heard Oscar speak at a meeting attended by Philippines President Gloria Macapagal-Arroyo that was focused on the convergence of information technology--or "information and communications technology" (ICT)--as its referred in the Philippines and elsewhere in Asia.
Take the Good with the Bad
Oscar had stressed a few key themes during his speech: the rapid growth of global sourcing of services in the Philippines and the country's high world ranking in this area on the one hand, with envy of a far larger industry in India and a lack of alignment of the Philippines' higher education system with available jobs on the other.
On the positive side, the Philippines had recently been rated as the world's top outsourcing destination by the UK's National Outsourcing Association (NOA). This was, in fact, the second time the country has won this award, winning the award over other finalists Russia, Egypt, Malaysia, and Sri Lanka. The industry now surpasses $6 billion USD in revenue and has created more than 400,000 jobs, and continues to grow.
The growth has been rapid enough in key areas such as Makati, other parts of Metro Manila, and the centrally located Cebu City to warrant a push by the Philippine government to designate other cities throughout the archipelago as target locations for global sourcing. The resulting "Next Wave Cities" program targets 10 areas--six of them ringing Metro Manila on the northern island of Luzon, two in the country's central Visayas region, and two on the southern island of Mindanao.
(I am very intrigued by all this, as these regions vary from the already highly developed area encompassing the former Clarke U.S. Air Force base to seemingly idyllic locations far from the madding crowds of what is now being called Mega Manila. Expect more reports on these areas as the year progresses.)
On the negative side, certainly the two disastrous typhoons of 2009, a couple of ferry accidents, and the recent, horrific family-based political killings deep in a remote area of the country do nothing but harm to the country's image. The looming election this summer poses an acid test for the country, to see if it can transfer power peacefully or whether the island nation's incestuous political culture will severely test the limits of a constitution that dates back only to 1986. (And let us never forget that prior to that, the dictator Marcos had no better friend than the United States.)
My experience over the past year in the Philippines has been a good one. As my readers know, my main complaint has to do with the heat. Even in this category, there are many places hotter than the Philippines, many places in Southeast Asia, much of India, and all of Texas in the summertime. Overall, I've found a high orientation toward service, a mental toughness, and willingness to help.
Oscar Sanez, BPAP CEO
India: Envy, Emulation, and Cooperation
"If you look at this chart, you will see that India has 10 places like Hyderabad," Oscar said during his conference speech. He was making reference to the numerous areas throughout India--Bangalore, Chennai, Mumbai and Pune, Delhi and Gurgaon, and others--that have each established their own "brand," their own specific identity to businesspeople throughout the world who are seeking Asian sourcing alternatives. "I wish we had that many (strong, well-branded) places, too."
NASSCOM, now 1200 members strong, has been pushing Indian sourcing for more than 20 years, and lists "strengthening the brand equity of India" as the first of its seven overall goals. Oscar sees something to emulate there. In the Philippines, BPAP now lists more than 200 members, and indeed, many of them are headquartered in India.
So I picked up on Oscar's remarks during our conversation, and asked him if he felt he was competing with India on a daily basis. "No, not really," he said. "There are certain things we can emulate about what's going on in India, but the fact is, we
have been working closely with them for the past four years. Sometimes we can be disarming, because India and the Philippines can offer complementary strengths, and together we can often address all of the concerns and needs of clients who may have been previously skeptical."
Expanding on this point, he told me that "most recently, we have renewed our MOU (memorandum of understanding) to reinforce this relationship and get on to more joint activities like research, policy and advocacy, and joint promotions. We have unique strengths as individual countries, and together, India and the Philippines can present stronger, two-location IT-BPO set-ups for many major multinationals," he said. "This has been proven by many companies who have located in both countries, leveraging India's strength in IT and the Philippines' strength in BPO."
Creating Homegrown Opportunity
I asked him about the disconnect between education and job opportunities, a subject that drew some passionate comment during the meeting I attended. A frequently-cited example is that of thousands of women in the Philippines who trained as nurses with the intention of filling open jobs in the US, but then found they simply could not get the requisite on-the-job training they needed at home before they could quality for those jobs. "We don't want to repeat this mistake (with respect to IT training)," Oscar told me.
A big difference, he pointed out, is that the IT challenge is to sync up education with homegrown opportunities. The Next Wave Cities report, for example, takes pains to describe in detail the number of available graduates in the targeted regions compared to a region's capacity (business climate, infrastructure, cost of living, etc.) to provide jobs.
It is well-known that Overseas Foreign Workers (OFW) represent 10% of all Filipinos and generate as much as 13% of the nation's GDP through remittances. Certainly there are thousands of new, technology-trained graduates who dream of that big salary in North America, Australia, or Europe so that they, too, can help their families in this highly family-centric nation.
But there are also numerous business and government leaders committed to creating homegrown opportunities that can help the country retain more of its talent. Count Oscar in this group. After spending 29 years as a Procter&Gamble executive in all corners of the world he returned home in 2005. He gets energetic when thinking about the role of the Philippines playing an increasing role in a "global supply chain that relates to services in the way a traditional supply chain relates to products," he says. The Philippines has already made many strides in this marathon, and the race is still in its early stages.
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