Outsourcing Business in the Philippines & the Threat of A.I.
Since I started working in the Business Process Outsourcing (BPO) industry in 2003, I have witnessed the many positive impact it had to the quality of life of my fellow Filipinos. In a country with a minimum daily wage of $6-$8 per day, the $10 a day more that BPO provides gave hope of a better future for more than 1.5 million employees and their families.
The industry generated a $23 Billion revenue in 2017 and is on track to hit even higher figures this year. During the first quarter of 2018, there are as much as 3 newly registered BPO companies per week. Is there a real threat to the industry with the fast-faced development in the fields of artificial intelligence, machine learning, and blockchain technology?
With my 15 years experience in the BPO and having spent a couple of years trying to understand programming and the blockchain technology; I am becoming more on more convinced that we are at the dawn of very significant changes that will revolutionize the way we interact, the way we work, and ultimately the way we live. In a January 2018 article published by Forbes titled "Technology Has Already Taken Over 90% Of The Jobs Humans Used To Do" the author highlighted the workforce displaced by technology and automation in the fields of agriculture, transportation, and fields that previously required manual scientific calculation.
We are merely in yet another phase of innovation marching towards humanity's drive for better productivity the author says. Since the earlier automation of the agriculture industry, transportation and scientific calculation, we are now attempting at yet further automation in those same industries. From weed resistant crops, to self-driving cars, to accounting and tax software suits. Construction is also getting hit by the new sets of equipment getting developed, and the 3D printing technology.
The contact center industry has evolved quite significantly too over the last 15 years. Things were much different in early 2000s where the focus was around efficiency. The yardstick for great performance use to be facilitating transaction as accurately as possible the fastest. This was followed by focus on reducing customer effort, making sure that the bigger chunk of the task in processing the transaction falls with the representative rather than the customer. In an effort to create more value with processing transaction, Net Promoter Scores (NPS) were started to be tracked. With higher NPS, the cost of each transaction became justified and sensible. The call center operations stopped being just transaction-based but also an integral marketing strategy through cross-sell and up-sell.
The frequency of customers getting their credit cards out to make an upgrade, and buy another product or service, as well as the average amount they spend became a measurable performance indicator. In 2015, I argued to one client that we are no longer a cost-center and are rather a revenue-center. In layman's term this means that we are generating more revenue in each transaction at the average than the average cost of each transaction.
The BPO has managed to evolve in the last couple of decades to not only remain relevant, but also to become an integral part of each organization's operation. There are efforts to yet again switch focus to Customer Emotion. In a Harvard Business Review article titled The New Science of Customer Emotions the research team introduced a new model of value creation and extraction trough the use of predictable “emotional connection pathway”. The global CEO of the Sitel Group spoke about Customer Emotion in the BPO in the video below.
While I wouldn't dare say that there are no real threats for further automation in the BPO sector enough to be felt through significant loss of jobs, I feel the industry overall's been resilient to this threat over the last two decades. There are arguments about the technology breaking-through possible cognition in artificial intelligence, I feel that imbedding emotion to the technology may still be a little farfetched.
By the time significant loss of jobs happen to the BPO sector because of artificial intelligence, we as a specie would have been dealing with a larger problem in many other industries that are manual, repetitive, and does not involve emotion.
Posted from my blog with SteemPress : https://onlineanarchism.com/2018/07/31/outsourcing-business-in-the-philippines-the-threat-of-a-i/