The Way, Way Back Office

Drop by the Manila offices of Source 1 Asia at two or three in the morning, and you might think you've stumbled into some late-night college cram session. Some 750 men and women in their early 20s, jazzed on cappuccino and junk food, are pulling all-nighters in front of their computers. The walls of the cavernous room are painted hot pink, purple, and lime green. But it's not Calculus 101 that has these Filipinos burning the midnight oil. They're busy handling credit-card queries from ChevronTexaco Corp. (CVX ) customers and walking users through the intricacies of Microsoft Corp. software.

Say "call center" to most Americans, and they think of tedious, low-paid, dead-end jobs fielding complaints about phone bills or bank statements. But in the Philippines, call centers are viewed as a gateway to exciting careers working on behalf of the best service companies in the world. Some 10,000 Filipinos, almost all with college degrees, staff 45 such centers around the clock, seven days a week. Companies like American Express (AXP ), Eastman Kodak (EK ), Intel (INTC ), Microsoft (MSFT ), and Dell Computer (DELL ) are flocking to the Philippines, lured by the country's low wages, generous tax breaks, and ample supply of English speakers. The call-center staff "are a very, very talented pool of people," says Arun Khanna, Procter & Gamble's (PG ) Manila-based accounting director. "They're committed, and comfortable with being trained and taking on responsibility."

Philip Sy is a typical call center worker. After graduating in 1998 from the University of the Philippines with a degree in German and Italian, Sy took a $250-a-month job at Source 1 providing assistance to people installing software on their computers. Now 28, Sy is a Source 1 operations manager overseeing 150 people and earning $13,000 a year, a small fortune in a country where 40% of the population lives on less than a dollar a day. "Considering the career growth opportunities, a job here is pretty desirable," says Sy, practicing yo-yo tricks as he wanders the floor monitoring calls. Another Source 1 employee, Karen Betita, 25, is the daughter of a diplomat and has a college degree in communications. She says she views the job as a good starting place for a marketing career.

Because they are able to hire some of the country's best talent, call centers in the Philippines are moving far beyond telemarketing. At the offices of Tampa (Fla.)-based Sykes Enterprises in the heart of Manila's Makati financial district, some of the 2,200 agents troubleshoot for control systems for oil rigs made by a U.S. manufacturer. "The salary difference between a qualified engineer in the U.S. and here is colossal--at least 10 times," says Michael Henderson, Asia managing director at Sykes. Others advise customers interested in life insurance and mutual funds offered by a major U.S. financial services company that Source 1 says it cannot identify. To get the licenses needed to market U.S. securities, Sykes flies Filipino staff to the U.S. and Hong Kong to take tests given by the National Association of Securities Dealers. Others at Sykes provide online support for users of Microsoft's latest Internet-access service, MSN 8.0, and help buyers figure out how to operate Kodak digital cameras. Says 24-year-old Sykes employee Michelle Abreu: "I see myself working in the industry for a long time."

It's that kind of attitude--and the fact that good jobs are scarce in the Philippines--that helps keep turnover at call centers under 10% a year, compared with upwards of 70% in the U.S. Indeed, Nathan Shapiro, Source 1's director of Asian operations, says he has just one headache: The Filipino employees are too polite, leading to longer, costly phone chats. "We have to teach them to be more rude," says Shapiro. That may be the one area in which U.S. service providers can't be beaten.

By Frederik Balfour in Manila

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