This Special Release highlights the final results of the 2016 Annual Survey of Philippine Business and Industry (ASPBI) for Business Process Management (BPM). BPM is comprised of selected industries of Sector J – Information and Communication and Sector N – Administrative and Support Service Activities.
Computer programming activities industry posts the highest number of establishments
The country posted a total of 1,496 BPM establishments in 2016, in which, the highest number of establishments came from computer programming activities with 512 or 34.2 percent. The second highest was registered in customer relationship management activities with 355 establishments (23.7%) and third was sales and marketing (including telemarketing) activities, recording 164 establishments (11.0%).
Figure 1 shows the percentage distribution of BPM establishments by industry sub-class in 2016.
Customer relationship management activities industry leads in terms of employment
In 2016, total employment of BPM industries reached 609,848 workers. Of the total, 609,693 or 99.97 percent were paid employees.
Among industries, customer relationship management activities posted the highest number of 420,763 workers or 69.0 percent of the total. This was followed by sales and marketing (including telemarketing) activities with 80,442 workers or 13.2 percent. Computer programming activities with 38,808 workers or 6.4 percent, ranked third.
Figure 2 shows the distribution of employment for BPM establishments by industry sub-class in 2016.
Employees in software publishing earn the highest average annual pay per paid employee
BPM industries paid a total compensation of PHP232.1 billion, which translates to an average annual compensation of PHP380.6 thousand per paid employee in 2016.
Industry-wise, employees in software publishing received the highest average annual compensation, amounting to PHP1.2 million per paid employee. This was followed by employees in finance and accounting activities, and publishing outsourcing activities, receiving an average annual compensation of PHP850.8 thousand and PHP682.4 thousand per paid employee, respectively.
Figure 3 shows the average annual compensation of paid employees for the top five BPM industries by industry sub-class in 2016.
Customer relationship management activities records the highest income and expense
BPM industries generated a total income of PHP487.5 billion in 2016. Customer relationship management activities contributed the highest income of PHP265.7 billion or 54.5 percent of the total income for the sector. Meanwhile, computer programming activities, and sales and marketing (including telemarketing) activities came next with respective income of PHP74.2 billion (15.2%) and PHP57.9 billion (11.9%).
On the other hand, total expense incurred by BPM industries in 2016 amounted to PHP419.2 billion. Being the highest contributor in income, customer relationship management activities also recorded the highest expense, amounting to PHP225.4 billion (53.8%). This was followed by computer programming activities with expense of PHP67.8 billion (16.2%), and sales and marketing (including telemarketing) activities, PHP48.7 billion (11.6%).
Figure 4 shows the top five BPM industries in terms of total income and expense by industry sub-class in 2016.
BPM industries post 1.16 income per peso expense
In 2016, BPM industries recorded an income per peso expense of 1.16. This means that for every peso spent, corresponding income of PHP1.16 was generated.
Among the industries, the application hosting services recorded the highest income per peso expense of 1.72. On the other hand, research and analysis activities posted the lowest income per peso expense of 0.91.
Application hosting services industry reports the highest labor productivity
Labor productivity, defined as value added per worker, of BPM industries in 2016 was estimated at PHP513,434. Across industries, application hosting services recorded the highest labor productivity of PHP2.0 million per worker. Software publishing, finance and accounting activities, and computer consultancy and computer facilities management activities, each recorded more than PHP1.0 million worth of labor productivity.
Figure 5 shows the top five BPM industries in terms of labor productivity by industry sub-class in 2016.
Gross additions to tangible fixed assets reaches PHP15.3 billion
In 2016, the gross additions to tangible fixed assets (capital expenditures less sale of fixed assets) acquired by BPM industries totaled to PHP15.3 billion. Industry-wise, customer relationship management activities had the highest gross additions to tangible fixed assets, amounting to PHP10.2 billion or 66.6 percent of the total. Sales and marketing (including telemarketing) activities ranked second with gross additions to tangible fixed assets of PHP2.4 billion or 15.5 percent. Computer programming activities placed third with PHP1.3 billion (8.3%).
Customer relationship management activities industry receives the highest subsidy
BPM industries received a total of PHP9.2 billion subsidies from the government in 2016. Customer relationship management activities received the highest allocation of subsidy which amounted to PHP9.0 billion. Other industries that received subsidies from the government were sales and marketing (including telemarketing) activities (PHP145.6 million), and other information technology and computer service activities (PHP11.9 million).
Computer consultancy and computer facilities management activities industry generates the highest change in inventories
In 2016, the value of ending inventories of BPM industries was PHP100.6 million.
The highest change in inventories was generated by computer consultancy and computer facilities management activities which amounted to PHP1.6 million. Other industries, which reported positive change in inventories, were human resources and training activities; and combined activities of intellectual property research and documentation, and security outsourcing.
United States of America (USA) contributes the highest to the total income from transactions outside the country
In 2016, income from transactions outside the country was estimated at PHP185.8 billion or 38.1 percent of the total income of the BPM industries.
Among the countries, USA had the highest contribution to the total income from transactions outside the country, amounting to PHP120.4 billion or 64.8 percent. This was followed by Australia, contributing PHP15.9 billion (8.5%) to total.
Figure 6 shows the distribution of income of BPM industries from its transactions outside the country.
Industry-wise, customer relationship management activities had the highest income from transactions outside the country which contributed 24.3 percent (PHP118.3 billion) to the total income of BPM industries. This was followed by sales and marketing (including telemarketing) activities with PHP27.2 billion (5.6%) and computer programming activities with PHP19.0 billion (3.9%).
Figure 7 shows the top five BPM industries in terms of total income and income from transactions outside the country by industry sub-class in 2016.
FOR THE OIC-DEPUTY NATIONAL STATISTICIAN:
WILMA A. GUILLEN
Assistant National Statistician
Social Sector Statistics Service, SSO
This Special Release presents the final result of the 2016 Annual Survey of Philippine Business and Industry (ASPBI) for Business Process Management (BPM) industries. BPM is composed of selected industries of Sector J – Information and Communication and Sector N – Administrative and Support Service Activities. Listed hereunder are the BPM industries based from the 2009 Philippine Standard Industrial Classification (PSIC).
Response rate for all sample establishments under the BPM industries was 81.7 percent (1,404 out of 1,719 establishments). This included receipts of “good” questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.
Of the total reports, 50 establishments responded online.
Reports of the remaining non-reporting establishments were taken from financial statements from Securities and Exchange Commission (SEC) and other available data sources. However, report of establishment which was found to be a duplicate of another establishment and out-of-scope were not included in the generation of statistical tables.
Concepts and Definition of Terms
Establishment is an economic unit which engages under a single ownership or control, i.e. under a single legal entity, in one or predominantly one kind of economic activity at a single fixed location. It is also defined as the unit that is engaged in the production of the most homogenous group of goods and services, usually at one location, sometimes over a wider area for which separate records are available that can provide data concerning the production of these goods and services and the materials, labor and physical resources used in the production.
Economic activity or business is the activity of the establishment as classified under the 2009 Philippine Standard Industrial Classification (PSIC). The main activity refers to the activity that contributes the biggest or major portion of the gross income or revenue of the establishment.
Computer and related activities establishment refers to office or firm engaged in hardware consultancy, software publishing, software development, data processing, database activities and on-line distribution of electronic content, maintenance and repair of office, accounting and computing machinery and others.
Miscellaneous business activities establishment refers to office or firm engaged in legal, accounting, bookkeeping and auditing; tax consultancy; market research and public opinion polling; business and management consultancy; architectural and engineering activities; land surveying services; technical and testing analysis; advertising; labor recruitment and provision of personnel; investigation and security services; cleaning of buildings of all types; pest control services; industrial cleaning activities; photographic activities; packaging activities; management and administrative services; bill collecting and credit rating services; business brokerage; stenographic, duplicating and mailing activities; fashion design; interior decoration services; call center activities; medical transcription and others.
Business Process Outsourcing (BPO) is the leveraging of technology or specialist process vendors to provide and manage an organization’s critical and/or non-critical enterprise processes and applications.
Outsourcing (or contracting out) is the delegation of non-core operations or jobs from internal production within a business to an external entity (such as a subcontractor) that specializes in that operation. Outsourcing is done to save money, improve quality, or free company resources for other activities. Outsourcing was first done in the data-processing industry and has spread to areas, including telemessaging and call centers.
Offshore outsourcing is the practice of hiring an external organization to perform some or all business functions in a country other than the one where the product or service will be sold or consumed.
Computer consultancy and computer facilities management activities includes planning and designing of computer systems that integrate computer hardware, software and communication technologies.
Software publishing includes publishing of ready-made (non-customized) software: operating systems, business and other applications, computer games for all platforms.
Computer programming activities includes the activities of writing, modifying, testing, and supporting software, designing the structure and content of, and/or writing the computer code necessary to create and implement: systems software (including updates and patches), software applications (including updates and patches), databases, web pages; customizing of software, i.e., modifying and configuring an existing application so that it is functional within the client's information system environment.
Data processing includes complete processing of data supplied by the customer, data entry services, scanning of documents, time share computer services etc.
Other computer related activities includes computer disaster recovery, software installation services.
Call centers activities (voice) includes inbound call centers, answering calls from clients by using human operators, automatic call distribution, computer telephone integration, interactive voice response systems or similar methods to receive orders, provide product information, deal with customer request for assistance or address customer complaints; outbound call centers using similar methods to sell or market goods or services to potential customers, undertake market research or public opinion polling and similar activities for clients.
Motion picture, video and television programme activities and post-production activities includes production of theatrical and non-theatrical motion pictures whether on film, video tape, DVD or other media, including digital distribution, for direct projection in theatres or for broadcasting on television; supporting activities such as film editing, cutting, dubbing etc.; distribution of motion pictures or other film productions (video tapes, DVD's etc.) to other industries; as well as their projection. Buying and selling of motion picture or any other film production distribution rights is also included. It also includes production of motion pictures, videos, television programmes or television commercials. Post production activities such as: editing, film/tape transfers, titling, subtitling, credits closed captioning, computer-produced graphics, animation and special effects film/tape transfers Activities of motion pictures film laboratories and activities of special laboratories for animated films: developing and processing motion picture film, activities of motion picture film, reproduction of motion picture film for theatrical distribution.
Total employment is the number of persons who worked in or for the establishment as of November 15, 2016.
Paid employees are persons working in the establishment receiving regular pay as well as those working away from the establishment when paid by and under the control of the establishment. Included are persons working as full-time or part-time and those employees on sick leave, paid vacation or holiday. Excluded are consultants, home workers and workers receiving commission only.
Unpaid workers include working owners who do not receive regular pay, apprentices and learners without regular pay, and persons working without regular pay for at least one third of the working time normal to the establishment.
Compensation is the sum of salaries and wages; separation, retirement, terminal pay, gratuities and others; and employer’s contribution to SSS, GSIS, etc.
Salaries and wages are gross payments made by establishments to its employees in cash or in kind, that is, prior to deduction for employee’s contribution to SSS/GSIS, withholding tax, etc. Included are total basic pay; vacation, sick and maternity leave pay; overtime pay and other benefits.
Employer’s contribution to SSS, GSIS, etc. includes contribution to Employees Compensation Commission (ECC), Philhealth, PAG-IBIG, etc.
Income refers to cash received and receivables for goods/products and by-products sold and services rendered.
Expense refers to cost incurred by the establishment during the year whether paid or payable. This is treated on a consumed basis.
Fixed assets are physical assets expected to have productive life of more than one year and intended for use and/or being used by the establishment. Included are land, buildings, fixtures, machinery, tool, furniture, office equipment, vehicles, and the like.
Gross additions to fixed assets refer to the difference between the cost of acquisition of fixed assets acquired in 2016 and the value of sales of fixed assets during the year.
Capital expenditures refer to the cost of acquisition of fixed assets acquired in 2016 whether or not full payments have been made.
Change in inventories is equivalent to the value of inventories at the end of the year less the value of inventories at the beginning of the year.
Inventories refer to the stock of goods owned by and under the control of the establishment as of a fixed date, regardless of where the stocks are located. Valuation is at current replacement cost in purchaser prices. Replacement cost is the cost of an item in terms of its present price rather than its original cost.
Subsidies are all special grants in the form of financial assistance or tax exemption or tax privilege given by the government to aid and develop an industry.
Value added is gross output less intermediate input. Gross output for information and communication is the sum of the total revenue (less interest income, rent income from land, dividend income, royalty income and franchise income), capital expenditures of fixed assets produced on own account and change in inventories. Intermediate input is equal to the sum of the following cost items: materials and supplies purchased; fuels, lubricants, oils and greases purchased; electricity purchased; water purchased; cost of industrial services done by others; cost of non-industrial services done by others; goods purchased for resale; research and development expense; environmental protection expense; royalty fee; franchise fee; payouts and other cost.