Another potential investment in the field of business process outsourcing (BPO) is on the horizon. Michael Chua of Transkripsyo Inc, a 200-seat medical transcription company based in Ortigas, was in Davao last 29 May 2007 for a first-hand look at what the Land of Promise has to offer.
Chua was welcomed by Wit Holganza, school administrator of MTC Academy and founding president of Transcription Alliance of Davao Inc (TADI). Holganza reports that Chua considers Davao as having 3 plus points: a significant pool of human capital; the city’s accessibility in terms of air routes; and, lower power rates compared to Iloilo’s.
Transkripsyo is apparently also looking at Iloilo City as another possible investment site. Then again, it might not even be a toss-up, relates Holganza. If feasible, Chua said that his company might in fact locate in both cities. Transkripsyo is planning on opening an initial spread of 20 seats, and possibly transferring half of their operations outside Metro Manila in the near future.
Let’s examine this sudden increase in BPO locators in Davao more closely, though. Does this signify that we are now really prepared for the influx of bigger I.T. / ITES investments? Are all necessary facilities and allied services already in place? This might not be the case in reality. In recent articles I have pointed out some weaknesses in our city’s development planning, especially in our purported I.T. Parks. Those issues aren’t resolved yet.
Chua observes that this growing interest in Davao and other regional I.T. hubs is driven not necessarily by their preparedness, but by the weakening dollar. Remember, BPOs are essentially exporters. It might be that these call centers and medical transcription companies are relocating to regional hubs in order to cut their losses — hence the concern for power rates. Of course Davao, Iloilo and other I.T. hub aspirants can offer cheaper lease and rental rates as well.
So, the strengthening of the peso against the dollar may be good for us now. But this cannot possibly last: eventually the currencies will stabilize. And when industry recovers from its effects, we will probably lose our sudden advantage — IF we do not secure our position.
How? We give ICT Davao, the representative organization of Davao’s I.T. industry, a set of teeth. It’s a mobile and young group that has the capacity to adapt. It has leadership potential. But, it does not yet have any authority to set the course for Davao I.T. It cannot yet interface directly with the local government, much less influence it. (Easier said than done, I know. But somebody’s gotta put a finger on the button!)
Another way of ensuring that our BPO locator numbers continue to rise, even beyond the grace of a weak dollar, is a success story. Or several. Holganza says that the 40+ member-companies of the MTIAPI are at present on a wait-and-see mode. That is, if Transkripsyo locates to Davao and decides to stay for good due to fiscal viability, we might see more of MTIAPI companies here in the foreseeable future.
Ergo, in order to address immediate concerns in I.T. / ITES investment management, a consolidated and collaborative effort by industry, academe and government is urgently called for. Imagine this scenario: An I.T. firm wants to locate to Davao, and sends representatives here. Whomever they contact here will know to which agency or office they should be referred right away. Whatever requirements this company might have will be met within a reasonable period. They need office space? Our answer: ‘How large?’ We’ll even anticipate that they’ll need a leased line to the U.S., and a 24-hour standby generator that can power an entire high-tech building (which they most probably won’t use because our power company is super reliable). They need manpower? Our schools interface directly with industry, so fielding graduates won’t be a problem….
Utopia? I hope not, because this situation is supposed to be within reach if we are to truthfully call ourselves an honest-to-goodness I.T. hub.
We can Thank God for our cheap electricity rates… 60% of the Philippines hydroelectric dams are found in Mindanao
We still have a lot of things to do. For the past few months, I have read alot of news and blind items about particular call centers / BPOs that would locate (daw) in Davao…Till now? wala pa rin kahit isa!
Why? Kc kulang tayo sa pagpromote ng Davao not only as an IT Hub but as an IT commodity as well……Cebu, Manila, and Cagayan de Oro are so successfull in selling their cities as an IT hub. Tayo? puro dada lang!
Also, nakakalungkot…i met a friend whose task is to search for future sites for their expansions. He said that their company is keen on having a business in Cagayan De Oro..Kc for them, it looks like na mas progressive and booming daw ang CDO than Davao! Perception counts! CDO is a winner when it comes to promoting their cities..Tayo? kawawa! this is so evident when u check other exhibits na kasali ang davao..kulelat tayo!
@XtremeXY — “wala pa rin kahit isa!”?? Have you been really looking close enough? Davao has two well-publicized contact centers, plus quite a few others that seem to rather remain below the radar, but they’re there. Aside from that, there are a number of medical transcription operators as well. And let’s not forget the world-class software houses that have been operating in Davao since the 1990s.
There are issues and problems within the Davao I.T. industry, true, but your statements do not help anybody. If there’s something you want to complain about, make sure you have a suggestion that might make things better. We in the industry welcome all constructive criticism, even unsolicited advice. But complaints are hardly ever useful unless accompanied by something positive.
Yes. Wala pa kahit isa. I was referring to those press releases of call centers that were planning set up in Davao. Until now, none have started their operations in Davao. I was referring to Alorica Philippines and other major players. Davao has two well publicized call centers? G-Com and Link2Support? These are small players in the country’s call center industry providing minimum wage to poor Dabawenyos. Ok, bravo for us for attracting small players while other major players invest in Dumaguete, Iloilo, Cebu, CDO, Baguio, or Bacolod.
My complaints were accompanied by a suggestion. Promote Davao! We may claim that we are doing that but if we do? Then why do other provinces have a bigger chunk in the IT industry and not Davao?
Nakakabit na kc satin ang excuse na “They may think negative satin kc we are from Mindanao”. That’s a crap! Cagayan de Oro is in Mindanao! But why do they have a different image to people here in Makati or in Metro Manila? CDO, Cebu, Iloilo, and other cities have been so active when it comes to promoting their cities as a product and a commodity for the IT industry in the country. But I have never attended an ICT exhibit here in Metro Manila with delegates from the Davao.
..and let’s not wait for investors to come or visit Davao….DCIPC should go out and promote Davao! Funny cos we have been trying to promote Davao from within..exhibits based in our city. But do these investors from here in Makati noticed Davao? Nah! So if they cant come to Davao..then bring Davao here in the capital! PROMOTE!
Here’s the thing, XtremeXY, if you want to see change, participate! That’s what I meant. You sound very frustrated in your comments. Well, why not jump in and identify yourself and contribute to the process of change? Things are happening finally. Why don’t you be part of it?
I already had!
One thing that Davao can’t “boom” or we just can’t be more progressive than CDO, Cebu and Manila is because most talented and experienced people in IT here in Davao, build their career to other places. 70% of computer science graduates of 2006 in Ateneo work in Manila and Cebu right now. So, how can Davao improve if we are losing man power?
Anyway, an IT company here in Davao is looking for people who want to build a solid career in IT. If anyone interested with this opportunity you may visit this site > http://bhipro.com/careers.html
they left because there were no IT jobs that can satiate their needs. Bring and create mode jobs in Davao and im sure that those graduates and the upcoming grads will stay in Davao.
Although, there are small IT firms in Davao, people also consider their salaries, benefits, etc etc. Few of the reasons why they are not in Davao today.
Kudos to the newly installed ICT Davao…its been less than a year but we have been seeing actions and developments in the IT and ITes arena!
It’s true: Davao does not yet have the capacity to absorb our IT grads. Another chicken-and-egg problem…. But IMO, knowing that we do have quality grads, it should be the businesses that should come in first. Then we will be able to lure our workforce back to Davao.
Thanks, tj_brewed! We’re trying our best!
Hey, I’m from Davao but I work here in Makati. It’s true there are not much competitive IT companies there in Davao and the salaries are way too low that’s why most grads look for jobs in Cebu or here in Metro Manila.
I’m looking forward that someday Davao City will have big IT companies just like here in Ayala. When that day comes, surely I’ll go back home.
I lived here in Davao and I started working in an IT company a month ago. If you compare my salaries from Cebu and Manila, you can really say my salary too low but if we talk about expenses. I can only spend 60 pesos per day for lodging and fare, and 60 pesos for 3 square meals a day. That’s why I’m not complaining about salaries here.
[Ranz said,
July 3rd, 2007 at 12:07 am
I lived here in Davao and I started working in an IT company a month ago. If you compare my salaries from Cebu and Manila, you can really say my salary too low but if we talk about expenses. I can only spend 60 pesos per day for lodging and fare, and 60 pesos for 3 square meals a day. That’s why I’m not complaining about salaries here.]
That’s true but with that salary too low, do you think you can save more money that much faster? I used to work there for almost 3 years and I can’t even save more money even with the low expenses. When I moved here in Makati, my salary was way higher. The expenses here were quite high compared in Davao but I have saved more money. Diskarte lng kc yan d2 pre. Groceries here are almost of the same price(except for fruits) as there in Davao. Moreover, I have just found a Supermarket here which sells groceries at even a lower price.
Well I’m not coaxing you to leave Davao just as I did but I think the Local Government of Davao City should really pay attention and push the promotion of Davao City as an IT Hub.
The local government is already doing that. And the local business sector is bullish when it comes to promoting Davao as an IT or ITes/BPO Hub.
We may be too late compared to other cities but with the developments happening lately, Davao is surely catching up. And we are not talking about tip toeing here but davao is taking a giant leap in the IT and ITes industry through the local government’s support and the local business sector’s support.
Today, three IT Parks are on the rise.. the PEZA approved DAMOSA, the NCCC IT Pavillion, and SM City IT Park. Two multinational call centers are making Davao their home, Link2Support and the upcoming Sutherland, the reason why I did not include GCom is that till now, I cant confirm its role in the ITes/BPO industry of the Phils as a whole.
I have worked in Makati too, and now I transferred in Cebu. If i would be given a chance to relocate in Davao with the same job, then I would.
Yes, I can save in Makati….but I honestly believe that I can save more in Davao. Well this is just my opinion. And yes, I agree that most of the expenses (basic ones) in Makati cost the same as in Davao.
But consider this: An average employee of a contact center in Makati would get an average salary of 17k. How much does an average contact center agent in Davao earn? hmmmm let’s say 8 to 10k?
Minus the deductions, plus the incentives and night diffs, the average net pay of a contact center agent in Makati per pay day is between 8 to 9k. Deduct your house/ unit rental, your fare, your daily expenses, your r and r, etc. If you’re in Davao and a resident, deduct your cheap fare, your cheap daily expenses, and your awesome yet affordable r and r activities.
I was one of the agents in Makati and trust me…yes I was able to save..but not that big enough.
Whereas in Davao, I dont have to pay for rent since we have our own place in the city, the fare is between 7 pesos to 10 pesos unlike the above 20 pesos fare per ride of an FX or the MRT. With food, same lang ang presyo ng Jollibee sa Makati and Davao or other restos but you have the option to eat sa mumurahing tindahan in Davao unlike in Makati na kahit ang Jolly Jeep eh mahal at nakakasira pa ng tiyan (i mean based on my experience). Every galaw sa Makati..gastos..gastos…gastos..and more gastos!
Yes, I can save in Makati with a tighter lifestyle, as what u said diskarte lang!…but in Davao I can save too but I can afford to live my lifestyle!
So if a Davao agent would earn a basic pay of between 8 to 10 k plus incentives, night diffs, etc. Let’s say an average pay of 5 to 6k per pay day. I dont have to worry about my rent and utilities. Bawing bawi kaagad and all alocated for having fun. =) d na kelangan ng diskarte!
When I left Makati and transferred here in Cebu, nanotice ko agad ang difference! I was able to live the lifestyle i wish to live! i enjoy my work with play! How much more in Davao na mas mura dun?
***disclaimer***
^^ This is just my personal experience. Maybe different sa iba who got a place in Makati or who does not have a place in Davao.
From the experience you said, tj_brewed, its completely different from mine. I can save more here in Makati than in Davao and I’m not even having a tight lifestyle.
Anyway, I hope more multinational companies will make Davao as one of their homes soon. I also would like Davao to have review and testing centers for IT professional certifications(Cisco, Microsoft, etc.). It seems that only Metro Manila and Cebu have these.
I think both of you, tj_brewed and Harvey, are on the same page when it comes to Davao’s capacity to absorb IT professionals. I would have to agree with Harvey, however, that it’s really easier to save money in Manila. The formula in Manila is quite straightforward: higher salary + same (or even cheaper) prices of basic goods + more opportunities of making money = Davao brain drain.
But, if Davao becomes more developed — i.e., more and diverse IT companies present here — then we’d have the same formula PLUS the fact that it’s so much better living in Davao than in the nation’s capital.
I do hope that people like you guys will indeed decide to come back to Davao when the opportunities start opening up. Soon I hope!
Davao will soon rise and I’m already starting to feel it. ^_^
I heard many multi-national companies are looking for office space here (well, yun ang naririnig ng tenga ko). One of my former classmates working in Cebu is planning to return and live here in Davao (nahihirapan na daw siya sa cebu, ewan ko bakit baka love life lang. hahaha).
I don’t think the expenses in Manila is the same here in Davao. One of my friends working in Manila is complaining about her expenses. She said the prices in Manila are almost doubled (thats what she said and she also want to go back here). Kung deskarte lang pag-uusapan, di na ako bibili sa grocery kung ang binebenta sa palengke sa umaga halos lahat presko (swerte lang siguro talaga ako dahil madami akong kaibigan magaling tumingin at mag haggle!). I’m glad I have a good place here in Davao.
But I hope Davao won’t be polluted like Manila. It really feels good to live here.
Oh btw, one of the reasons I don’t want to leave here in Davao is our mango tree’s next fruiting season. (Ang sarap talaga ng bunga ng mangga namin!!! dahil siguro yung bata pa ako, dinidiligan ko siya habang naliligo ako sa labas! Hahaha!)
I agree with Blogie. I also do hope Davao will have more IT companies soon. If those companies will offer the same competitive salaries and benefits as here in Makati then I would SURELY go back home — no need to convince me. I can save more if that’s the case.
You could go back. Ever heard of Sutherland? It is now here in Davao.
I will surely GO BACK as well!
Davao is on its way in promoting IT/Outsourcing companies in the city. It is not about getting boomed or getting ahead, little by little davao will marked its way as one of the developing hub for IT companies in the Phil. let’s just wait and see. Good opportunities and compensation will kick-off the road…
It’s 2009 now and there are a lot of BPO industries that are booming here in Davao. Try to go around Davao and you will notice that Sutherland, the first BPO company in Davao, is at the center of the City. ^_^ Sutherland already took “The Venue” so that they could extend.
Check it out! ^_^
Hi there! Thanks for visiting my IT blog. With all due respect, Sutherland isn’t the first BPO company in Davao. There’ve been several other BPO outfits in the city years before Sutherland, involved in various areas such as accounting, medical transcription, etc.