Outsourcing to the Philippines during COVID-19

India currently has the biggest outsourcing market while the Philippines has the largest concentration of employees in outsourcing. The outsourcing industry is one of the two main pillars that keep these countries economically afloat, contributing about $26 billion to their economy in 2019. To date, there are approximately 1000 firms and 1.3 million employees in outsourcing spread across the country.

COVID-19 has had a detrimental effect on the world of outsourcing. As the globe struggles to outpace the pandemic, the outsourcing industry has been constantly and rigorously finding ways to keep up. While the outsourcing industry in the Philippines was one of the few industries that were allowed to remain open, minimum health protocols and quarantine has taken a toll on staff and employee numbers. This then greatly affects the 1.3 million population of outsourcing employees in the Philippines.

In addition, many aspects of outsourcing have been proven to be flawed, and the pandemic has even more exposed many weak points that people used to overlook before. Here are perennial things to consider for future outsourcing pre-pandemic and post-pandemic.

1. Appropriate disaster plan

In the pandemic era, many outsourcing companies are faltering because of the lack of a disaster plan. While multiple physical locations can be a good contingency plan, it certainly did not prove to be effective when COVID-19 struck.

It is important that moving forward, many businesses consider investing in continuity planning that involves blueprints for disasters such as the pandemic. They would also need to be comfortable with planning mechanisms that involve broad-based and more functional remote working guidelines which are capable of being implemented even in such disasters that may be worse than COVID-19.

2. A more systematic remote working guidelines

Unfortunately, the COVID-19 has also exposed the exploitations of these workers in the outsourcing industry. Many have been complaining about the unsuitable work-from-home environment as data in the Philippines show that there are approximately 4-5 Filipinos that live in every household which isn’t built to fit their family size.

This made employees change their contracts to floating status and rendered many employees to continue working despite having tested positive for COVID-19. Those unable to work are disposed of and left without financial security. Those who can work are otherwise placed in dangerous situations.

The need to safeguard employees has been manifested pre-pandemic, but it seems that more stringent remote working guidelines must be envisioned in order to protect them even when working at home.

3. Thorough analysis of one’s own outsourcing strategy

Analyzing one’s own outsourcing strategy is a good way to handle the COVID-19 outsourcing aftermath. A good outsourcing company turns crises into opportunities while at the same time not underestimating COVID-19. The rise of the COVID-19 era may impede on some outsourcing strategies that are currently existing in the company, so it’s important to look at new ones that fit an organization’s business model. One of the key advantages of outsourcing business functions is the potential to tap into a skilled workforce either within or outside one’s own country.

It is expected for organizations to be agile since the COVID-19 pandemic has hindered specific outsourcing strategies to be less efficient than other strategies. Organizations must pay attention to the critical functions of outsourcing and determine which type of outsourcing best fits the current climate of their industry amid COVID-19.

4. Preparing for the ‘worst’

Related to planning a disaster strategy, this must be emphasized because, on the one hand, there exist many situations when disaster plans are too far-fetched that it has been difficult to facilitate them during times of actual need. On the other hand, disaster plans haven’t been intricately planned out that cases as bad as the pandemic haven’t been covered, and it became a bombshell to many businesses instead.

The key to a good disaster plan is to prepare for the worst, while at the same time maintaining realistic means to facilitate the blueprint for the plan. Nobody has expected the pandemic, but outsourcing companies that remained afloat are ones that have systematic and specific disaster plans designed to deal with the ‘worst’.

5. Redefining administrative control structures

A competitive executive team in the business is oftentimes the solution to a successful operation of the outsourcing industry, regardless of whether there is a pandemic or not. One of the trends that became visible when COVID-19 struck was that organizations were deliberately made to adapt to stringent administrative arrangements to accommodate the changing work environment.

Being quick-minded is a benefit to organizations. Creating a more redefined hierarchy of governance and control within these organizations in the context of a remote working environment is important to keep the organization up and running. In this way, any unforeseen circumstance whether that may be within or beyond the scopes of a specific disaster plan is immediately dealt with executively and would be less detrimental to the whole economic environment or branches of the company.

Conclusion

How will this change the tides of the outsourcing industry in the coming days? The effects of COVID-19 are likely to continue around the globe for a decade or so. Increases in outsourcing will benefit the Philippines but at the same time, it will constantly test its vulnerability and dependency. It’s important to keep not just the company in check, but the in-house employees working from home as well, and make sure that nobody gets left behind.