Nearshore Americas

The Cultural Dimension of Outsourcing: Seen through the Eyes of the Customer

“Imagine that your beautifully crafted strategy failed when the divisions within your organization clashed. Logically, it seems that strategy should drive behavior—but, in reality, it’s your culture (underlying norms, values, belief systems) that dictates how people are going to work together. As a result, employee behavior directly impacts your bottom line — your costs, revenue, productivity, customer base, even your brand. Every aspect of your business is affected.”

—Juli Ann Reynolds, CEO, Tom Peters Company & Susan A. Murphy, Ph.D., Chief Consultant

Now imagine that you are outsourcing—two different companies, buyer and provider working together, with some goals the same (e.g., success of the engagement) and some different (e.g., the buyer wants to minimize cost, the provider wants to maximize profit).

The Issue of the Cultural Dimension is not often raised in outsourcing relationships, yet it can be the difference between success and failure. Every worker, every project, and every company has its own culture. Many times in an outsourcing arrangement, people from different backgrounds (locations, religions, companies, etc.) are contracted to work together. Offshore outsourcing takes it even further and includes people from different countries, different cultures, and different time zones.

Outsourcing is a partnership, where the partners (the buyer and the provider) need to understand each other in order to work effectively together. However, a number of times cultural differences cause misunderstandings that lead to less than desired or expected results.

The Premise

1. People are most effective when they work with people they understand, who think and behave the way they do.

2. Some of your work will involve interacting with people from different countries, who won’t always think and behave the way you do (either buyer or provider).

For those interactions to go more smoothly and be more successful, it will help if each side learns more about how people from the other side think and behave, if each side pays attention to culture.

And just what is culture, anyway? Culture is the underlying value framework that guides an individual’s behavior. Culture is reflected perceptions, social interactions, and business interactions. Culture guides the selection of appropriate responses in social situations. Culture is a learned behavior. People learn do’s & don’ts as they grow up.

Differences Affect Outsourcing

While there are many areas to discuss about cultural differences—concept of self, concept of face, manner of giving feedback, time management, load balancing, concepts of accountability and taking ownership, saying “no”, style of interaction at work, business and social etiquette (cultural do’s and dont’s—we will briefly highlight only two that can affect an outsourcing engagement’s results:

Dealing with Superiors – The deference to authority is different in different cultures. Interaction with management is influenced by many cultural behaviors, including the desire to be polite and respectful, the will not to disagree or contradict, saying what a superior wants to hear, expectation of micromanagement, and a preference to do nothing rather than make a mistake.

Communication Styles — In a desire to protect your face, an outsourcing partner might not disagree with or correct you in front of others, or might not ask questions when he doesn’t understand something. In a desire to save face, he might not admit to making a mistake, or admit to not understanding, might not ask for clarification, and might not ask for help when needed. Most worrisome: He might not report problems or delays.

Bridging these kinds of cultural differences requires being aware of those differences and engaging accordingly. I’d recommend incorporating the following suggestions into your strategy for guiding offshore outsourcing relationships:

• Beware of your assumptions

• Verify communication

—Don’t assume you have understood

—Don’t assume you have been understood

• Explain the obvious

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• Don’t assume people with different means are pursuing different ends

• Train key people about cultural differences

Outsourcing vendors from different countries usually do a good job of teaching their employees about the culture of the buyer/client they are going to work with. Yet, many times, the buyer does not provide any training to recognize the cultural differences of their vendor/partners particularly when that vendor/partner is from another country. Awareness of cultural differences can have a big impact on the success of an outsourcing relationship.

Marty Pine is a recognized thought leader and global business services professional who has worked as a senior executive in customer, provider, and advisor companies—with experience and contacts in India, the Philippines, China, Russia, Eastern Europe, Brazil, Latin America, and the U.S. He can be contacted at


Kirk Laughlin

Kirk Laughlin is an award-winning editor and subject expert in information technology and offshore BPO/ contact center strategies.

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