Heroes in Business - Eric Mulvin Why is the Philippines an Outsourcing? Hub Part 2

Episode Date: September 17, 2023

Learn about how the history and culture of the Philippines made it a leading outsourcing hub. Eric Mulvin and Jake continue their insightful discussion on the Cactus Chat. 

Welcome to the Contact Center Cactus Chat Podcast. I'm your host, Eric Malvin, and we're back for part two of our discussion with me and Jake coming out from the Philippines, my co-host here. And we're talking about why is the Philippines one of the leading hubs for outsourcing in the world? And so last episode, we talked about history of the US taking over the Philippines for a while and that played a big role. We talked about infrastructure, we talked about how the call center industry has been in the Philippines for a couple decades now and so now there's that investment to prepare for more future growth. And so today we're going to continue that

conversation. We're going to talk some more about growth. And so today we're going to continue that conversation. We're going to talk some more about culture because that comes up all the time, work ethic. I've got some examples to share with you guys there. And I also want to share, if you're listening to this episode, I'm guessing you're probably thinking about outsourcing. And maybe you're thinking about either what country to outsource or what company you want to work with. And so if you're thinking about outsourcing to the Philippines, I've got some things to consider, like because every country, no matter where you go, everything's going to be different. You know, Philippines is an exact copy of the U.S. There's a lot of things that are different. So we'll talk about some of those differences and some things to look out for

and why maybe working with a company like Pacbiz, you don't really have to think about them. So let's dive into it. So culture, that's what I really want to jump into because everyone talks about the culture of the Philippines the the story I hear the example you know that I think is worldwide is uh the reputation like if there's an actual disaster and you've got the news covering it and just flooding and people's houses are being washed away and then they show the Filipinos and they're like smiling and they're happy and they're like yeah you know everything's gonna be fine I'm here it's a testament to the culture like that the way people think in the Philippines is way Filipinos think all over the world and so talk to me about that a little bit because you

are you're living it but you know people people look at the Filipinos and there's a I guess maybe a stereotype sometimes but it's also true you know about the hospitality and the culture being happy in the face of adversity so why is that well I guess first of all yeah why is that such a big deal for outsourcing why is that important of course um you know we've been known to be uh to have this uh you know oh you know thinking always the positive side of uh you know things uh as filipinos um you know you can see you can see we we have we've been through a lot like disasters and other things and you know you can still see people doing their things while cleaning their houses on the flood and other things with the

smile of their faces and you know you can't have you can't question why are these people where they you know like they're not worried about it too much probably because of you know we've been we've been through a lot you know during the the you know the the old times like when when we were colonized by you know by spain um you know and after that by the americans and uh you know during the war as well uh we there was the those were the difficult times of the older people. And yeah, I think it's because we've been used to things, difficult things. And the only way we can... There's something about that, like the effectivity of showing in the surface that we're okay.

Sometimes you can't really tell that what's this person going through because you know they keep on smiling and you know laughing and that's um that's something within the filipinos and also there's one thing like you know if we're guilty about something and you know we um you know when somebody is trying to correct a Filipino. I don't know, sometimes, it's probably within our culture that we smile a bit and you can hear us on the phone that there's a little evidence of a laugh or something, but maybe it can get you know

misinterpreted by the person on the other phone but that's being us Filipinos is trying to it's like acknowledging that sorry I made a mistake on that and you know you can hear them with a little smile on it. But sometimes the person on the other side will find it sarcastic. So that's a difference. That's one example of cultural difference of Filipinos and, you know, and other races. But it goes so well with customer service, right? Like you, you know,

if you're good at dealing with tough situations and putting a smile on your face, what happens when you're got a tough customer on the phone and you've got to put a smile on your face, you're able to handle it better. And so, you know, like they all, they go kind of hand in hand and it was nice to, I mean, it's sad what the Philippines had to go through, but, you know, like they all, they go kind of hand in hand and it was nice to, I mean, it's sad what the Philippines had to go through, but, you know, we're able to take that and turn it into, uh, you know, building up the country and providing jobs. But those, those are real things like people, like they come up, like they, you're right. Like about the smiling. I haven't heard that exact scenario, you know i'd rather deal

with that you know that people are you know trying to be happy and to make the customer happy because again it's all about that customer experience and you know what's happening these days and i always got a time where i can you know ai and AI and what's happening. Like more and more calls are being automated. And so the call center jobs, like when you're dealing with answering the phones, now automation handles the easy stuff. So now we're handling the more difficult stuff. So more and more, if you're working in the call center in the Philippines, chances are you're probably handling stuff that was tougher than what people were dealing with 10 years ago, five years ago even, is stuff that sometimes there's

no point of someone doing this work. It should be automated. So it does give Philippines a competitive edge when it comes to being able to handle those tougher calls because that's where the trend that I'm seeing is that it is going to get tougher, that you're only outsourcing the hard stuff because the easy stuff, a bot can handle, or they can do it themselves on their website. You don't need to talk to a person. Yeah. And yeah, it's, it's, you know, it's been an effective practice,

but you know, it's also within us that uh you know we we put that smile on our faces uh during you know when we instead of you know being angry that's uh you know that's uh being a filipino like um you know there was one training that i attended like uh you can be very effective in talking to the customer with a slight change of your tone when you put a smile on your face while talking, even if they can't see you. Probably that's something else that we have. But again, as I mentioned, not all customers with cultural differences, if you sound like you're not really not really uh affected or you know you

you're you put that smile on your face while you're or where you're speaking to a difficult customer um you know they they tend to uh have that uh they they think that you're being sarcastic but you know um overall we're just trying to provide the best customer experience. Yeah, absolutely. And another thing I wanted to talk about was work ethic, which goes, I think, closely along with how we're handling the customer on the phone. So I think one of the biggest pieces of feedback I get, and I've probably said it on a past episode, is when we first start working with a company that has never outsourced before or outsourced to the Philippines. And I always love being on those calls with the client because like right away, like they're there. I can tell they're like they're they're trying to get something out. They're trying to tell me something. And many times they can't put the words around it. Like they don't know how to describe like this feeling. i'm like oh it's the work ethic right like you

know the work the culture that you see there and that they're happy to come to work and that they actually listen to feedback and stuff and they're like yes that's it like but it it is something that i i don't know how you measure this or you you know, it's not something that I hear talked about the Philippines a lot, but I hear it from the clients that they they did not realize that people like this still existed in the world. They thought that, you know, like everyone, the way that your workers are in the U.S., that's how everyone is and that's how it will always be forever. And so it's like a breath of fresh air for the clients when they start working with our team and they're like man they show up they're here all the time they're consistent they're asking questions they're learning they're getting better and so that I don't know if we're just doing a great job finding the right people or it's a Philippine thing but I know that's something

that I've been seeing a lot but I don't know what yeah it's very common Eric that's I think it's a Philippine thing, but I know that's something that I've been seeing a lot. But I don't know. Yeah, it's very common, Eric. I think it's because of the culture. And, you know, we love our jobs. And, you know, most of the people who are, you know, out there, it's really hard to get a job here in the Philippines. You know, there are certain places who would really wish and you know hope that you know they can land

a job somewhere and once they have it you know they they really uh you know they they would they would do anything to keep the job and yeah that's that's another thing uh you know being you, that's the reason why we don't retaliate, I guess, with the angry customers. And we mostly just, you know, help them, you know, just to resolve their issues and, you know, give them their solutions of the reasons why they call the center. So most of them are, you know, having these problems and most of them are, you know, just wanted to have a service in a specific industry so i believe that it's really difficult for others to work in a vpo company or call center

you know but once they're here you know they they take care of it and yeah that's one thing we always talk to them about like you know we we provide this is what we represent we provide better service and you know customer experience so we just keep it like that and you know if you know they um now they if we always take care of the customers uh in short that's uh that's that's uh that's what we are and uh even also in you know different places when we see maybe that's part of being the hospitality of the Filipino. We want to make sure that they don't feel bad or they feel good about being here about being around us that's one trait that we have it's that is very unique and you know working everywhere, especially working, dealing with foreign people on the phone, like Americans.

We wanna make sure that they're not feeling bad about talking, I mean, while they're talking to us, me as a Filipino, that's one thing that I wanna make sure that the person I'm talking to is comfortable talking to me. Yeah, because it goes back to customer experience. know you want to make the customer comfortable feel happy have a positive experience and if it's built into the culture if you're naturally you know wanting every within every interaction wanting people to feel like that it's uh it just makes it easier for

every day that's what people are doing on the phone so i want to switch gears a little bit here and talk about uh some things to look out for if you're also we talked about culture we're talking about all the positives right now every culture has its positives and maybe some faults too um now now we're not going to talk about faults of the philippines but we're going to talk about just some things some things to look out for. And I will say that over the last eight years of running PACT is with Jake, Jake's operations manager. So he's the one that is making sure that these issues don't happen. But we do a lot to, well, we take care of all of this for the companies that work with us.

So the stuff we talk about are things that you might not have to worry about or ever deal with. When would you have to deal with these is if you're working with a really small company, maybe you hired someone on Upwork or someone online, you know, you just post something somewhere out there on the internet. I'm looking for someone in the Philippines to answer calls and here's the rate the paper hour so now you're you're doing the job of pack this basically you're doing the job of managing this call center employee and so all that support now you've got to handle so when that's happening you might have to deal with some stuff that we usually deal with. So that's what I want to talk about. And so one of the things, actually, I talked with another company, another partner of ours that also has some virtual assistants in the Philippines,

and he was sharing some of these too. And I thought, this is great because I don't really think about this stuff. But if you're outsourcing, you should be thinking about it because not only the philippines but anywhere like what's the weather like what natural disaster do they have i mean if you're trying to pick somewhere in the u.s and you're putting your business you know if if um you can never go down and you have to be up and running all the time like a data center you might not want to put your data center on the coast of Florida, you know, or, you know, if you're worried about earthquakes and, you know,

and you might not want to put your business in California. So just like everywhere else in the world, Philippines, you know, I think the big thing that they have to deal with there are typhoons that you guys, and you guys just a couple of weeks ago, he had another one that hit most of the whole country. So the thing that the feedback I got from our partner here was like, typhoons are real. And he didn't, then it was just like hurricanes. It's just the Asian name of a typhoon or of a hurricane,

but they're just as destructive. So tell me why is that a challenge? You know, why, why are typhoons and hurricanes, I mean it's obvious, but why is that something that people need to look out for? Yeah, because Philippines, its location, it's facing the Pacific where most of the typhoons are, they start from the Pacific Ocean most of the time. And yeah, they, you know, they're unpredictable of course. And you know, the last time we had the big one was two years ago and it was really, really big.

And yeah, it, you know, that's something, because we always, we've been prepared with it you know that's something because we always we've been prepared with you know heavy rains typhoons but not as not with the big one I mean that happened two years ago that we were out for you know for days and you know on the on the client side I would imagine you know working with someone relying my business to to to that outsourcing to the to the company and you know them being out for several hours or days but yeah we've been we've been really planning planning so many things to prevent that from happening thanks to the internet, which has really improved that we can have it directed to through Starlink if people are aware of that.

That's what I was going to mention yeah you know we've been investing in the infrastructure there but again like you're you're a freelance person you're hiring from home isn't going to be able to afford the gear unless you buy it for them and pay for their monthly bill but they're not going to have the gear to invest into that and so when there's those power outages when there's when there's those issues if you got when there's those issues, if you've got someone working from home, it's something you've got to look out for. And, you know, we've been able to combat that or we have an IT team that's making sure that they're working from home, that they have backup internet, backup power. It's not really a challenge. It's just when you're hiring someone freelance to work from home, could be something to look out for typhoons

and and one thing that i learned with that storm that hit two years ago you always see on the news like all these homes are wiped out and you think like man it seems like a lot like how did so many people lose their homes like i i see the homes in the philippines they're like solid cement walls yeah they're like crazy way overbuilt compared to the u.s but these aren't the homes in the philippines they're like solid cement walls yeah they're like crazy way overbuilt compared to the u.s but these aren't the homes that are getting knocked down right like the homes like the homes that you see which could be the people that you have working for you i know it impacted some of the employees at pactus but this isn't your your brick home right why is it that why is it breaking down? Yeah.

And, you know, having to have the, you know, the office as a backup place where we're getting, you know, we come and, you know, report back to the office if, you know, during those times. Especially because we, you know, we, yeah. That's true. Yeah. People come, yeah. With the last storm, that's what happened everyone came to the office and uh you know if you don't have that with backup internet backup power then there's no place for them to go but you know for those those workers i wanted to mention you know what happens is uh what i found out which again this is we're trying to educate our listeners here uh and i always wondered how did that work? How did everyone's home get destroyed? It's because

they're built out of light materials. Cause I was amazed, like within a couple of weeks, I thought those people that lost their homes needed help. And now it's not the case for everyone, but I know for some of the employees, because it was light materials, they were able to put it back together relatively quickly, which I thought was just interesting. But that's a challenge now. And then if you have your worker living in a house built out of light materials and the wind blows it down, they might not be coming to work for a couple of weeks

while it gets rebuilt. They might have to be putting it together again. So, right? I mean, am I right here on this yeah and yeah it's just so unfortunate that some are some you know some homes and you know families are you know not being built to you know withstand the strong winds and you know of course their location if they're in the wrong location uh they would they would be affected by typhoon so it's if you're working uh you know it's trying to outsource uh you just need to ask

those questions as well um how how are we uh you know how are we doing it when you know when these things will happen like uh what are the backup plans and of course you can also you can also limit the yeah exactly limit the things that you can you can give them like you know you can you can just be relying on them maybe just give it to others like you know their that bad spot is you know in comparison to having an office is is you know it's there's a big difference there so that's those are the things that you know you can you can check while you are trying to work and you know save a little bit just don't go in directly with uh you know with uh with a freelancer or uh just working directly for from someone who's working yeah or any company that you're outsourcing

with uh you know these are great questions to ask like when's the last time that your your office went down and for how long and what happened why why is that you know and if it was recently and they haven't done anything to make sure it doesn't happen again. You know, but people no one ever asked me these questions. So if you go to your outsource company and you start asking these questions, you know, they know that they'll know you're serious and you want you need good support. But but really, I think the challenge is for that, because we talked about infrastructure in the last episode. So Philippines has really built up offices, internet, all the facilities in the office building. So if you're outsourcing to the Philippines, a lot of these challenges aren't really a big deal.

They were maybe before. And I know Cebu got hit that same storm a couple years ago. But they were able to bounce back pretty quickly. Um, getting the call center stuff up and running the neighbor, the neighborhoods and the homes, you know, that's another story, but, um, but yeah, so that's something to look out for. Another thing that I want to talk about, uh, if you are hiring directly, you know, if, if you're working with an outsource company, this should never even come up as a conversation but 13th month pay so if you're not from the Philippines like so explain to people what is 13th month pay

yeah that's the pay that they're gonna get at the end of the year equivalent to a one month pay so basically that's it's a bonus so they receive that every end of the year so that's that's what we have I believe not all the countries have the 30 month pay yeah it's part of the culture definitely we have a Christmas bonus it's not mandatory it's part of the culture. We definitely, we have a Christmas bonus. It's not mandatory. It's not in the U.S. Constitution. It's not in the Constitution, but I know it's Philippine law that you have to do the 13th month pay. Yeah, and I believe other companies are doing really good, Eric. They have this 14th month pay.

So they receive two extra months of pay at the end of the year. So yeah, they get to enjoy more a lot of extra money to buy something that they want. So why do you think if you hired a freelance person in the Philippines, and I think it might be a little different though. I mean, if you have a freelance person, I don't think they expect the employer, they don't expect this person in the u.s necessarily to do the 13th one pay maybe but they might so like i mean i i've seen this scenario come up where you get to the end of the year and you have a budgeted for it i mean it's one twelfth of what you paid them all year. And that can be a lot in expenses if you have a lot of labor and you didn't budget for it. So and I mean, I'm sure you've had friends that that didn't get their 13th month pay.

Maybe they were doing customer service somewhere and the employer was not based in the Philippines and they, uh, they didn't know about it, but I know when we first started PacBiz, uh, the, and the taxi business, I didn't know about it either until I think maybe it was like two or three years in, it was one of our managers was like, Eric, uh, you know, we, we usually get a bonus here and I started learning about it but but those are the things if you don't know about that like we deal with all that so there's no extra bonus that the client has a thing but if you're working freelance that could become a big deal yeah those are you know you can feel the energy of the people every December you know they got that and they you know started posting

and Facebook like you know this is where I got those things and you know they got that and they you know started posting it in Facebook like you know this is what I got those things and you know if you're working with someone and you know directly and you're not getting you know the the things that you're supposed to have and you're working with you know with the company a BPO company so that's you know there's a difference and maybe you you know it has you know somehow it affects people who's working like yeah i'm not getting what i what others are getting and you know those things but you know it just depends but those those are the things that you would expect you know uh working uh with it from working with it with a company and maybe if you're

outsourcing and you know working directly with someone you would probably you would be expecting that kind of conversation some somewhere yeah and then because we're gonna get into the end of this episode here to wrap it up you know no matter where you decide to outsource these are really important questions that you should be asking or you should be looking into it. Because there's a whole other culture there, even in a place like the Philippines that's really closely aligned with the U.S. There's still differences. And those differences, you know, if you understand those differences and you might be able to take better care of your employees, they're going to, in turn, take better care of your customers or whatever you have them doing. And so whether it's the Philippines, whether it's Colombia, whether it's the Caribbean, Pakistan, whatever, those are things like think about you know, think about those cultural differences. And sometimes those cultural differences can help

and they could make that experience better for your customers. And sometimes they might be something that you'll have to work around that, you know, might not might not help, but but you can work. So any last thoughts here, Jake? Yeah, it's just that, you know, if you want to, you know, starting a business, if you're a just that uh you know if you want to you know starting a business uh if you're a business owner you know you should be or you know you you should love your your business and if you want to make sure that you've been taking you will be taking um care properly um

you know with with all the you know the things that should be there on a company that you partner with when you're outsourcing. Make sure to ask the right questions and make sure that the interruptions and the outages are being answered or being addressed. Yeah, I know every minute counts during calls customers will call you know just to talk for less first for a few seconds or a minute you know getting the business getting a business by talking that short and you know if you're if you're outsourcing to a company that that has could potentially be out for you know hours or you know days with all the things that

you know that's gonna happen around you know you better ask those questions just to make sure that you know the outages are you know being controlled or you know shortened so that's the best way to to be more effective so you yeah just asking those questions and of course if you're listening to uh listen to us um eric and i uh most of the podcasts that we had we talk about these things so yeah you can get uh great points uh by listening yeah so thanks yeah go back listen to some old episodes we cover a lot of this stuff stuff and what to look out for. And so, but yeah. And if you want to learn more about outsourcing, about managing call centers or managing your call center vendor customer experience,

listen to more episodes. We're going to be talking about that. And I've got some really exciting guests coming up to some people that, you know, business coaches that encourage their clients to outsource because, or at least have a virtual assistant, you know, so some really, really great, great guests coming up. So I want to thank you, Jake. It's great to be back behind the mic with you. I know it's been, I think we had like six months since we last recorded an episode. So always great to do a podcast with you. So appreciate it. Yeah, same here, Eric.

Thanks for the opportunity. And, you know, just trying to, you know, based on experience, trying to share my experience here about how to do it right, do things right and outsourcing. So I'm glad to help. All right, cool. Well, until the next episode, subscribe so that you can hear more episodes of the Contact Center Cactus Chat, and we'll catch you in the future. Thanks for listening, guys. Thanks.

Thanks. Thanks.