The Philippines’ IT-Enabled Services Industry

The Philippines’ IT-Enabled Services Industry

51 Pages · 2005 · 323 KB · English

The Philippines’ IT-Enabled Services Industry Page 4 of 51 1.3. Types of ITES In this report, we will focus on the five types of ITES that the Philippine government

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The Philippines’ IT-Enabled Services Industry Ted Tschang 1 INTRODUCTION 1.1. Paths to Development Economic literature has identified a number of different industrial development paths. Possibly the most important is the East Asian path to industrialization followed by the four Tigers as well as other emergi ng countries, described in voluminous literature on the role of the state (Amsden 1989, Wade 1990, World Ba nk 1993), on the rise of the electronics industries (Amsden 2001, Hobday 1995), and on the emergence of a more innovative industrial path in Korea and Japan (Kim 1995, Kodama 1997). More recently, a second path based on software has emerged, exemplified by India’s rise as a software producing pow er. India’s software industry and its capability have been described extensively in the literature (Arora et al 2001, Heeks 1996, and Evans 1995). Numerous developing countries have also attempted a similar strategy to India’s, typically with lesser degrees of success (Arora and Garmbardella, 2005). With the rise of information technology (IT ), a third form of development has now appeared: the export of services . While the development of service sectors was traditionally assumed to be confined to developed countri es that have mature markets and industrial sectors (Foray and Lundvall,1996 ), it has recently been found that with the appropriate educational and other supporting bases, devel oping countries like India and the Philippines can also take this path. Specifically, the rise of IT-enabled services (ITES) outsourcing or business process outsourcing (BPO) has allowed these countries to develop a new kind of export sector focused on business services. The factors that support these new service export industries are becoming better understood. A number of consulting and government reports have been written on

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