New Zealand Software Development: Considering Philippines as a technology partner

  • Date Added: 22nd September 2015 from ExportNZ

  • by Scott Darrow


    Fast-growing software companies have to balance the use of capital with hiring the right talent at the right time. It is a balancing act that an entrepreneur must get right in order to build a successful business - not only for profit, but also for maintaining a culture that drives success. Operating in a market that is experiencing resource shortages and rising costs will ultimately force managers to look for alternatives, thus, I would suggest evaluating outsourcing as both a short and long term option that can help address both profit and growth.

    As globalisation continues to surge, selling NZ software internationally is becoming more important for software companies. Yet, with this continuing trend, there are associated obstacles that can limit the success of projects and general business operations. Working with an offshore team can bring disciplines to a local team and can provide greater perspective on global challenges that all software companies face. Fine tuning issues such as global functionality, culture and language with your own offshore team is a lot easier than firefighting with new overseas customer.

    Offshore teams can help deal with customer support and maintenance, QA (manual and automation testing), release management, technical writing and project development. Having built several software teams in the Philippines, I was surprised how quickly we trusted Manila teams to the extent that core application development was shared between New Zealand and technology teams in Manila.

    Many technology companies are realising the benefits of outsourcing to the Philippines, taking advantage of the creative and expressive nature of people.

    Unlike India and China, the Philippines has a culture that is very compatible with Western cultures. After being a Spanish colony, the Philippines was governed by the United States from 1899 to 1946 - the influence is still very evident today. Television and movie theatres are almost fully dedicated to American productions shown in English without subtitles. English is the primary language for business and education in the Philippines. Although the official language is Filipino or Tagalog, the Philippine government has considered English as its major or official language for its widespread use.

    With the strong presence of the US, the Philippines has developed a government that is somewhat similar to the US system. This makes Western companies more comfortable doing business in the Philippines.

    The Philippines has a very high literacy rate of about 92%, with basic education made available to practically the entire population. The Philippines is the largest English speaking nation next to US and UK, and it produces around 40,000 IT Graduates per year.

    The Philippines has around 80,000+ software developers who work exclusively for export with around 200,000 IT and software personnel currently working for multinational players such as Accenture, IBM, HP, AWS, Shell, Coke, Chevron, Safeway, Microsoft, Oracle, SAP, among others.

    Export revenue for IT Business Process Management was around US$ 18.9B in 2014 with US$ 2.1 B in software exports. Some 14% of Philippine software companies have CMM/CMMI or ISO certifications.

    As Kiwis, we have a tendency to do it ourselves. If you are interested in in IT outsourcing, I would suggest talking to NZTE in advance to make sure you are connected with the right people.


    Scott Darrow is ADEC Innovations Global Chief Technology Officer (CTO) and Chief Information Officer (CIO) of ADEC Innovations, a global provider of Environmental, Social and Governance (ESG) solutions. He is a visionary and goal-oriented technology executive with 33 years of international experience in planning, designing, developing and implementing innovative Information and Communications Technology (ICT) solutions that address business opportunities and challenges.

    In 1994, Scott moved to the Philippines to set up Logistic's offshore development centre in the country. In the Philippines, he co-owned IT-Commerce and founded PHINZA, which produced a comprehensive IT Operations Management (ITOM) system, implemented using the latest web-browser-based technology. Scott serves as an advisor to New Zealand Trade and Enterprise under the Beachhead program. Beachheads connects participating companies to a network of private sector advisors in New Zealand and around the world who can act as mentors and provide insights into the realities of growing internationally successful businesses.

    For more information contact the Trade Commissioner in the Philippines Hernando Banal hernando.banal@nzte.govt.nz