Outsourcing: Davao City to be its new Center

Recent studies have shown that Davao shows potential to be the new Center for outsourcing. In the headline news that I’ve read yesterday, according to a research by XMG, it states that organizations in the city belonging to the business process outsourcing (BPO) industry are expected to lead the development of the area as a robust technology hub.

XMG added, citing a study it conducted between January to March 2008, saying that outsourcing vendors who participated in the survey are very bullish about Davao City, primarily due to the area’s larger population of untapped qualified resources compared to Cebu City in the Visayas.

The study highlighted that competition in Cebu City is nearing saturation as the talent ramp-up continues.

The study also highlighted the population of Davao City as considerably higher than other Tier-2 offshoring cities globally. In the Philippine context, Davao City’s population is 71% higher than Cebu City, 499% larger than Olongapo-Subic City, 333% higher than the Angeles-Clark area, and 340% larger than Baguio City.

“The city’s estimated workforce is twice of Cebu, 9 times of Subic, and 7 times of Clark, and 6 times of Baguio. This has not even taken to account the manpower pool at the nearby cities and provinces of Davao City,” the company said.

According to the study, Davao City has various educational institutions annually yielding a higher number of IT and BPO qualified graduates than Subic, Clark, and Baguio by 689%, 278%, and 40% respectively.

Wow, this is really good news for all davaoeño wannabes who want to be part of the IT outsourcing companies in the region. This is also an over whelming experience to be a center of outsourcing industry, and overcoming the top outsourcing center, which is the Visayan region.

But the question in my mind is the city well prepared for asserting as a viable alternative information technology hub three years from now?