Business Success — Philippines for the Rest of Us

Where Did You Wake up this Morning?
It's not North America only cheaper and populated by Asians. It's different here, so stop acting like business in the Philippines is business in North America or Europe. It's not. People will withhold warnings about the stupid thing you're about to do so as not to embarrass you or themselves. No one will tell you to duck.

Figure you won't know what you don't know for the first three years you operate in the Philippines. During that time keep your eyes open and your mouth shut until you know the game.



Partner Well
If you are setting up and you're not a big mahaca of a call center or Korean ship-builder, you'll be incorporating as a Philippine company. That means you will be in business with your wife, in-laws, or some group of locals you know in some fashion. As with partnering anywhere, be very careful about this arrangement.

Take extra care because the Philippines' culture is different. It may seem very approachable (compared to working in Sri Lanka, it probably is), but that does not mean that cultural difference is not significant. Spend some time getting to know your prospective partners and make sure everyone has skin in the game.



Cutting Corners? Don't.
Often, smaller guys like myself wind up taking the fast path, buying into someone's connections as the easy route, using fixers for everything, etc. My advice is adhere to the high road as much as possible. You will glad you did.

The reasons are varied and numerous: you will wind up incurring personal debts you don't understand (for favors that will be called in, trust me); something thought long resolved will rear it's ugly head at an inopportune moment; the short cut winds up being a far more lengthy and expensive process that you imagined, etc. Everyone has a relative or an inside connection. Stick to knitting, play it straight, and wait your turn just like everyone else.



Doing It for the People
Chances are you plan to set-up in the Philippines to conduct operations that are people intensive. People intensive with what Peter Drucker called Knowledge Workers. That is to say you are here for the classic labor arbitrage. Drucker also pointed out that you have to "Accept the fact that we have to treat almost anybody as a volunteer."

What does that mean in the Philippines? Treat your people right. Look after their interests (the government won't). Accept the fact that managing people requires a lot of attention to HR practices: screening, learning, setting expectations (with exhaustively documented processes), well-defined policies and procedures, etc. While it can be quite cumbersome, dig in and invest some time here at the front end to create the right documentation and learning materials. If you need help with this, give us a shout (shameless plug).

Do What You Say Say What You Mean
If you are doing business in Asia, be scrupulously honest. You are held to a higher standard of behavior in the eyes of your business associates and your people. Business being (small) business, you'll be challenged to follow through on your plans, commitments, obligations, etc. Do so as much as possible.

The Swami is In (Manila 2008)

Inevitably the year's end and the prospect of the next brings out everyone's bent for prognostication. This year I'll be no exception. I'll weigh in with a few thoughts since I suspect no one will actually hold me accountable for these if I'm wrong and if I'm correct, I get to crow on about my skills thereby up-ing my consultant street creed.

Prediction 1: Even as more offshore destinations appear on the horizon, the dollar loses value relative to the Philippine Peso, and offshoring comes under scrutiny in the 2008 Presidential scrum the Philippines will get more seats of business in a migration of massive proportions. Why? I'm glad you asked:

• $10 - 15/hour is still better than $25/hour
• Canada, Australia, UK, Singapore, New Zealand, etc. are still expensive places to operate back-office activities; they have cash to spend; and they are at near full employment.
• India's voice business will migrate in droves.
• BPO in the Philippines has matured significantly and will continue to do so.
• The Philippines has game (remember that this was the most dynamic economy in Asia before Marcos had his way with it).

Prediction 2: BPA/P will improve its ability to communicate with the world on behalf of the industry. The new McKinsey report commissioned by BPA/P is deep, insightful and pretty rosy in its outlook. It also means that someone has taken the time to work with a well-respected consultancy to develop an objective view of the Philippines as destination. Oscar Sañez has also proven a capable leader with a solid understanding of how to guide advocacy in and outside of the Philippines.

Prediction 3: The movement outside of Metro Manila will continue unabated as organizations like TeleTech drive service delivery beyond Manila and Cebu.


Prediction 4: Since the big contracts are spoken for, Boutique Outsourcing and the mid-market will offer more opportunity through the end of the decade. It's not just for the big guys anymore — others will get in on the act as they realize the do-ability of outsourcing and the industry continues its search for growth.

Prediction 5: Software as a service/hosted applications/apps on tap will be increasingly key to those of us that don't have the inclination to have a large IT staff or re-invent the wheel.

Usually it's the big organizations that have things like globally deployed project management tools that permit Shell in the Netherlands to work on tasks with Shell in Dubai, for example. Today it's not just for corporate behemoths anymore: we use applications like Basecamp, a very cool collaboration/project management tool that helps us work together with clients and vendors on everything from online marketing to business plan writing.

That's one of several tools that we employ to offer marketing services to North America, Australia, the Middle East, etc. Now that anyone with a few hundred bucks can perform collaborative work from afar and the playing field will keep opening up for niche services offered offshore. WSJ Research identifies several hallmarks of effective Global collaboration: Frequent communication, Common task understanding, Clear expectations, Familiarity among team members [cited from Phred Dvorak in WSJ article, Global teams: divide (work) and conquer].

From Manila: Looking at 2008

As part of the predictable New Years resolution packet, here is a new blog announcement that trumpets a set of blogs that signal a selection of blogs that segregate my musing into a few categories:

• Business in the Philippines with a bent toward Outsourcing from the Provider Perspective: Manila Comment
  
• Observations on the talent variable of the offshoring equation: Talent Philippines
• Stuff I wish I'd known setting up here in the Philippines: Boutique Offshore
  
• Still more commentary on everyday life in Manila and Southeast Asia: Manila Muse
  

These concepts had been jumbled together in a basket of observations in Manila Muse, a project I had unfortunately abandoned as my time in 2007 became more consumed with the project growing a business through its delicate second year of life. That was a year of surprising growth and, as I reflect upon it, a year of multiple revelations in the endeavor of management and operations as a supplier to the BPO industry.

The rationale for the activity is pretty straightforward — Blogging provides an opportunity to solicit global input on ideas that have global and (increasingly) local relevance. As much as the notion that accessing other's input, I suppose I wish that someone had appraised me of the specifics of running this kind of business in the Philippines. Plenty of consultants will provide insight into the world of large business here, but few offer relevant insight for companies that either operate here or source a portion of their business offshore but at a smaller level than large outsourcers. More importantly, on a personal level, writing about these ideas helps me to more effectively explore them than almost any other method.

Learning Manifesto - Part 2

Education for BPO's continued. My last discussion on the vocational education situation dealt with an inspirational source for successful education in the Philippines — the marriage of an the American institution, public education, with the nuances of local culture embodied in the Thomasite experiment. Using this particular inspiration serves as a handy precedent to the odd American showing up with an educational agenda.

The contemporary situation is this: American companies (more often than not) are showing up in the Philippines to deliver voice services. The associated requirements have evolved from locating suitable agents to creating suitable agents using increasingly sophisticated pedagogical techniques.

By sophisticated, I mean we need a methodology that is up to the task of providing a tincture of acculturation, an improved ability to communicate in and process English language, and the capability to function effectively in a relatively high-velocity environment. Interestingly, how do we engage a history of American-Pinoy engagement with the commercial pressures of globalization in the practical matter of learning that supports North American business requirements?

The fact is I don't have a complete picture or a ready made declaration on the matter — I thought I did, weeks ago, but I'm reduced to an incomplete list of items to be mindful of as we create our theoretical institution:

The context for BPO expansion is a large requirement for jobs. In that light, there is a ready and willing group of people who are keenly interested in working.
Those people are not necessarily qualified beyond their desire to do the work. This desire must be a foundation for an education sufficient to create staff suitable to the tasks required — application develop, technical support, customer service, etc.
Desire is enough when supported by a modicum of English knowledge and cultural awareness.
The people teaching have to understand and value the local (Pinoy) and North American (Western) culture.
The Philippines is an estuary of both — that's why we (big honkey Kanos) are here. Forget that at our peril.
Problem solving skills and aligned interpretation are the key issues at stake. How do we turn back the Marcos era of complacency or the atrophy of Bahala Na — a kind of "God will provide" fatalism woven into Pinoy culture thanks to the vicissitudes of history and a massive dose of old-school Catholicism.
Community and personal relationships rule the roost here in the Philippines. Learning and professional development need the framework defined by these culture structures known as Utang na loob or the Padrino system as it became known during the Spanish colonial period.
These structures are handy tools for developing networks (hence the widespread adoption of social networking online). Localized learning benefits from intelligent use of these technologies.
Eclecticism or what Carlos Celdran calls the Jeepney Aesthetic adds another tool for reconciliation to the mix. The Philippines is relentlessly postmodern (as loaded as the term is). By reconciliation, I mean reconciling the commercial exigencies of the BPO beast with Pinoy cultural paradigms.
The last point is that these strands are reconcilable and can add value to one another. Jobs, commerce, and global visibility on the one hand: meet a culture defined by mélange of Catholicism, Spanish colonialism, American imperialism, Japanese imperialism, Sino mercantilism, unparalleled war destruction, Hollywood — the list goes on.

Suffice to say the purée of culture here combined with an oddly personal approach to technology adoption and deregulated telecommunications makes for the opportunity to work through the broader issues of learning to Globalize.