In spite of China’s emergence in global outsourcing, it isn’t going to unseat the Philippines outsourcing industry from its spot as one of the top destinations for offshore operations. While it’s a growing market, China simply isn’t ready from a managerial standpoint, according to outsourcing research firm Everest.
Two issues hold China back as a major destination for outsourcing companies from the US and Europe. Culturally, the country doesn’t have much in common with Western cultures like the United States. This makes it hard for some Chinese to relate with these customers. Another significant issue is the lack of English language skills, an important factor in the success of any offshore venture.
Philippines outsourcing has both of these capabilities. Its history as an American colony gave the country both some sense of cultural affinity with the US. That’s reflected in its importation of Hollywood movies and American music. English literacy also isn’t a big problem in the country, as the medium of instruction in many schools is still English, which means most Filipinos have at least a basic command of the language. Outsourcing companies flock to the Philippines because of these reasons.