OUTSOURCING firms that rely primarily on routine, execution-based work will face mounting pressure from artificial intelligence (AI), while companies that move into higher-value services stand to benefit from the industry’s next phase of growth, according to Philippine-founded Asiatel Outsourcing Inc.
Asiatel chief executive officer Jasjit Singh Anand said AI is changing the competitive landscape of the business process outsourcing (BPO) industry by shifting demand toward knowledge-intensive services rather than repetitive tasks.
‘I think there is a low end of jobs which is execution-focused,’ Anand said during the company’s media briefing on Thursday morning in Taguig City. ‘Purely execution-task will come under pressure.’
Instead, Anand said companies that successfully integrate people, business processes and AI into their operations will be better positioned to grow. ‘I believe every technological shift creates winners and losers,’ he said.
‘The winners from here will be the companies that will blend the three. One is people, second is the process, and third is AI,’ he added.
He added that while automation is expected to replace some routine work, human workers will continue to play a central role. ‘Humans will stay at the core… Humans in the loop will be an important aspect going forward.’
The company is responding by expanding beyond traditional outsourcing into knowledge process outsourcing (KPO) and AI-enabled services. ‘Our strategy is simple. We are actually moving away from execution-task,’ Anand said.
‘We were never in the pure execution-task. We were actually an embedded extension office…and from there, we are now going up on the value chain in the KPO space and the AI space.’
Among the areas Asiatel is targeting are engineering, environmental, social and governance (ESG), software-as-a-service (SaaS) and AI-driven finance solutions.
Despite a more measured industry outlook recently unveiled by the IT and Business Process Association of the Philippines (IBPAP), Anand said the company remains optimistic about the sector’s long-term prospects.
Ibpap projects the Philippine information technology-business process management (IT-BPM) industry to generate $42.3 billion in revenues this year and between $43.3 billion and $50.5 billion by 2028.
‘We should respect that position because that’s a respected IT industry body,’ Anand said.
While new technologies are reshaping outsourcing, Anand argued they will also create business opportunities that are difficult to predict today.
‘I feel that there will be new sectors which will emerge which we cannot see at this point of time,’ he said. ‘If AI…helps in the global output, that will create certain opportunities which we cannot imagine at this point of time.’
Expansion after TSX listing
Asiatel recently became the first Philippine-founded outsourcing company to list on the TSX Venture Exchange (TSXV) in Canada.
Asked whether the company also plans to pursue a Philippine Stock Exchange listing, Anand said management is focused on executing its expansion strategy following its Canadian debut.
‘We just listed in Canada. It’s our second day into trading. Our focus right now is to run the company in a very compliant, very sound manner, sticking to the fundamentals,’ he said.
Since starting operations in 2006, Asiatel has grown organically to generate more than $6 million in annual revenue, while employing about 500 workers in the country and serving clients across eight countries.
The company plans to add up to 250 delivery seats in Metro Manila, establish satellite offices closer to employee catchment areas and pursue acquisitions of niche outsourcing firms to strengthen its KPO and AI capabilities.
‘We would be flexible in expanding in the north and south of Metro Manila,’ Anand said. ‘The next 100 to 150 seats, we see Metro Manila as the priority delivery location. After that, maybe it makes sense to go to provincial cities.’