Top BPO Destinations – Feb 2014 List

Since its inception in the mid-90’s, the BPO industry has grown in leaps and bounds and is showing no signs of slowing down. The industry provides great environment to work, compensation commensurate with experience and competence, MNC exposure and good growth prospects to its employees.

Which is why, the BPO industry has emerged as one of the most exciting and ‘cool’ places to work. This acceptance has helped top BPO destinations to create more jobs for its people and contribute to the growth of the economy as well.
Sri Lanka is known more for its tourism. Photo courtesy: boatshowsrilanka.com

What Makes for a Good BPO Destination?

Market studies and research shows that there are several factors in play when it comes to being a BPO destination. The Outsourcing Unit of London School of Economics created a framework for country attractiveness to set up BPOs which stated 6 broad factors as shown in Table 1:

Country Attractiveness Framework
CostSkillsEnvironmentInfrastructureRiskMarket Potential
1. Labor
2. Infrastructure
3. Taxes and Incentives
4. Skill Pool
5. Provider Landscape
6. Government
7. Business
8. Quality of Life
9. Accessiblity
10. ICT
11. Real Estate
12. Transport
13. Power
14. Security
15. Disruptive Events
16. Macro-economic
17. Regulatory
18. IP
19. Local Markets
20. Nearby Markets

First being cost advantage. Captives and BPO centers are opened after evaluating the expected cost savings in a particular country, which has to be significant. Here the cost of labour, infrastructure as well as taxes is taken into consideration.

The second most important factor is availability of skills. While the qualifications like good educational environment, sense of technology and management matter, the underlying and imperative skill for a country to qualify as a top BPO destination, is for its people to comprehend and speak good English.

Like it is for all businesses, the acceptance of Government to open offshore centers without much ado is a chief factor in determining a BPO destination. The tax benefits, risk factors, market potential, accessibility, quality of life and other flourishing business scenario are determining factors.

Top 10 Countries for Setting up BPOs

With more than a decade of successful growth in the BPO sector, India wins hands-down as the top BPO destination in the world.

Favorable conditions such as cost-effectiveness, high demand for jobs, level of competence along with an environment that fosters the right skills, people who are well-versed in English language and the level of acceptance by the Government makes India an ideal BPO destination.

India’s direct competitors who are also among the top 10 BPO destinations are: Philippines, South Africa, Poland, Morocco, Malaysia, Kenya, Sri Lanka, Egypt and Northern Ireland in no particular order. The special advantage India has over these countries is its significant cost advantage and English speaking population.

Climbing the Competition Ladder

The following countries are looking up in terms of economy, Government support as well as improving skill sets and could be the next top BPO destinations. These include: Argentina, Bulgaria, China and Egypt. 

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