Back Office Segment Workforce Development Strategy

1
Back Office SegmentWorkforce Development Strategy

• 21 February 2006
• Presented by the Business Processing Association
  of the Phils.
• Mitchell Locsin (Executive Director, BPA/P)

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Business Processing (Back Office Operations)

• As of 1st Quarter, 2006
• No. of Service Providers 60
• Total Full Time Employees 22,500
• Estimated Revenues in 2005 US 180 Million
• With a Growth Rate for 2005 50

3
Key Players

• Captives AOL, AIG BPSI, Chevron Texaco,HP, HSBC,
  Procter Gamble, Flour Daniel, Henkel Financial
  Services, Deutsche Bank, Citibank Crescent
  Services, Shell Shared Services, Manulife,
  Alitalia, Watson Wyatt, etc
• Third Party Providers Accenture, American Data
  Exchange, SVI Corp, SPI Technologies, DAKSH
  eServices, The Environments Collaborative,
  Eximius BPO, BayanTrade Dotcom, etc

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Range of Services

• Current Services
• - Accounting and bookkeeping - Legal
  Transcription
• - Account maintenance - Litigation Support
• - Accounts receivable collection - Content
  Development
• - Accounts payable administration - Contract
  Summarization
• - Payroll processing - Publishing
• - Asset management - Travel Services Back
  Office
• - Financial analysis and auditing - Loan
  processing
• - Inventory control and purchasing - Health
  Insurance
• - Expense and revenue reporting - General
  Insurance
• - Financial reporting - Sales and marketing
• - Human resources administration - Tax reporting
  
• - Customer Management - Financial leasing
• - Credit card administration - Transaction
  management
• - Factoring and stock brokering - Sourcing and
  Procurement
• - Revenue management - Logistics
• - Transaction processing - Disaster recovery
• - Business data processing - Business
  Intelligence
• - Database management - Network management

• Arising Services (KPO)
• Market Research and Analysis
• Intellectual Property Mgmt

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Demand Side - Quantitative
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Demand Side - Qualitative

• HR Analyst Qualifications (Mo. Sal. 13-18k)
• Educational Attainment mostly HR-related college
  degree e.g. Psychology, HR Applications other
  degrees such as Industrial Engineering
• Additional Training from 4 12 weeks training
  on industry practices such as compensation and
  benefits policies, etc.
• Work Experience n/a
• Skills/Competencies analytical skills, oral and
  written language proficiency (advanced English),
  communication skills
• Certifications n/a
• Others willing to work on shifts

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Demand Side - Qualitative

• Fin Analyst Qualifications (Mo. Sal. 13-18k)
• Educational Attainment mostly Business-related
  college degree Accounting preferred for
  bookkeeping Political Science, Economics
• Additional Training mostly internal 4 12 weeks
  on specific business processes, e.g. Portfolio
  Management
• Work Experience n/a
• Skills/Competencies quantitative/analytical,
  computer literacy, oral and written language
  proficiency (advanced English), communication
  skills
• Certifications (not mandatory) Certified Public
  Accountant, Chartered Financial Analyst (for
  complex)
• Others willing to work on shifts

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Demand Side - Qualitative

• Engineering Qualifications (Mo. Sal. 18-25k)
• Educational Attainment mostly Engineering-related
  college degree Business degree also
• Additional Training mostly internal 4 12 weeks
  on specific business processes, e.g. Procurement
  Management
• Work Experience n/a
• Skills/Competencies quantitative/analytical,
  computer literacy, oral and written language
  proficiency (advanced English), communication and
  negotiation skills
• Certifications n/a
• Others willing to work on shifts

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Demand Side - Qualitative

• ICT Operations Qualifications (Mo. Sal. 13-18k)
• Educational Attainment mostly ICT-related
  college degree Engineering degree also
• Additional Training 4 12 weeks on specific
  technical operations processes, e.g. Network
  Administration
• Work Experience n/a
• Skills/Competencies quantitative/analytical,
  computer literacy, oral and written language
  proficiency (advanced English), communication
  skills, process aptitude
• Certifications Vendor-specific as needed
• Others willing to work on shifts

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Demand Side - Qualitative

• Generic Qualifications (Mo. Sal. 12-15k)
• Educational Attainment mostly college degree
• Additional Training 4 12 weeks internal
• Work Experience n/a
• Skills/Competencies quantitative/analytical,
  computer literacy, oral and written language
  proficiency (advanced English), communication
  skills
• Certifications n/a
• Others willing to work on shifts

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Additional Qualifications

• Languages in demand
• Spanish, French, Mandarin, Cantonese, Korean,
  Japanese, etc.
• Oral and written proficiency a plus (commands
  salary premium)
• Engineering/Architecture Licenses
• Under GATS, mutual recognition allows licensed
  Filipinos to practice their profession in
  countries that have cross-certification
  agreements with the Philippines

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Supply Side for HR
13
Supply Side for Finance/Acctg
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Supply Side for Engineering
15
Supply Side for ITO
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Supply Side Summary

• HR Urgent need for HR-related degree
• F/A Supply of Fin/Acctg is more than needed
  opportunity to market more of these type of
  skills
• Engg Current supply seems adequate, but as
  sub-segment matures, this may turn into a
  shortfall quickly
• IT Operations Supply of ITO is more than needed
  opportunity to market more of these type of skills

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Supply Side Constraints

• Content-related Issues
• Current emphasis on auditing should be on
  bookkeeping
• Need more exposure to automated systems, e.g.
  ERP, HRIS
• Faculty-related Issues
• Lack of Faculty proficiency in English which
  results in subject matter not being taught in
  English
• Teachers must be able to teach automated
  applications
• Brain drain of qualified faculty
• Facility-related Issues
• More automated applications rather than manual
  ledgers
• Regulatory Concerns
• Strict implementation of English as medium of
  teaching
• Others
• Reluctance to work night shift
• Roughly 25 attrition (10 involuntary, 15
  voluntary)

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Recommended Strategies

• Short-term
• Approach of teaching English should shift to ESL
  (DepEd/CHED, Academic Organizations e.g. COCOPEA,
  PAASCU, PASUC)
• Advocacy (Industry, Media)
• Support English is Cool campaign
• Career track advocacy to college students
• Course of study advocacy to high school students
  (and parents)
• Use of automated transaction systems such as ERP,
  HRIS (with appropriate faculty retraining)
  wherein industry partners with academe (COCOPEA,
  PAASCU, PASUC w/BPAP)
• Medium-term
• Development of curriculum for specific needs of
  the BPO industry for entry level and
  middle-management (CHED, CEDFIT, BPAP)
• Separate course focused on bookkeeping and
  transaction-keeping rather than auditing
• Need for industry to establish standards