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How to deal with cultural differences in IT Outsourcing Projects

03.11.2016

Leszek Czarnota

How much cultural differences can affect cooperation with remote outsourcing teams? Can effects of those differences ruin such cooperation? How to prevent communication problems?

The problem

Definition of culture

How about starting with definition (one of many) which seems to fit best the purpose of this article?

“Culture is a fuzzy set of basic assumptions and values, orientations to life, beliefs, policies, procedures and behavioural conventions that are shared by a group of people, and that influence (but do not determine) each member’s behaviour and his/her interpretations of the ‘meaning’ of other people’s behaviour.”

Spencer-Oatey 2008 [1]

Influence on cooperation

There are two main areas which immediately come to mind in reference to IT teams cooperation. We see that set of belief and values influence both:

1. Behaviour of the given group of people;

2. Their interpretations of other group of people behaviour.

For example culture will affect the way engineers interpret tasks assigned to them. There may be different approaches to challenges depending on cultural background.  Good example of cultural difference in approaching tasks was presented in Computer Weekly article by Kathleen Hall:

Peter Ingram, IT director at Addison Lee, says he first considered moving IT work to the region when the company needed to rewrite its main booking platform. 

"[...] So we picked a team in Russia and a team in India and sent each a week's worth of source code that needed to be written in a new language as a test" 

he says.

"The guys in India said yes to everything, copied the mistakes we had deliberately put in there, and didn't ask us anything about the business - it was all very systematic. The team in Russia looked at our proposition, asked if it was functional, noticed the mistakes and asked us why we did things in this way. They really challenged us and had much better engagement," 

he adds [2].

The cultural differences may be much more evident at crisis situations. For example vendor team members may consider if they should openly communicate project delay or mistakes made by the team. Or maybe better wait and see if a customer would notice and then react accordingly to the customer message.

There may be also diversities how project obligations are perceived depending on cultural background. The example with Indian and Russian teams show difference between obligations seen as systematic work 8 hours per day versus obligation to efficiently deal with challenges and solve problems.

Most people have seen the difference in expressing emotions among cultures. In Europe high contrast can be perceived between Scandinavian (restrained) and Mediterranean (expressive) way to show emotions. So it is  highly likely that what Swedish team may interpret as quarrel between Italian team members is just discussion. So they may quite wrongly interpret the seriousness of the situation.

Examples can be multiplied, everybody agrees that the multicultural differences affect the IT outsourcing. How do deal with them to minimize their impact on cooperation.

The solution

Realize the differences

We are using 3 main sources to analyse the cultural differences and their possible impact on cooperation:

1 .our past experiences,

2. local partners/sales representatives,

3. insights provided by consultancy companies like ITIM International.

In practice we use the knowledge about cultural diversities already in sales stage.

  1. Gathering intercultural experiences continues since entering international market for the first time. It maybe painful in some situations. Nevertheless it is important to assure that such experiences are collected within company so it can be later shared.
  2. When we enter new country with a local partner or sales agent we use his knowledge to understand the major differences. Working with us in the sales process he has learned our cultural specifics so he is perfect translator.

For new countries we use the 5D Model prepared by ITIM International (http://itim.org/) - analytical tool providing key insights into differences between cultures and their consequences in business cooperation. The cultural specifics are defined by 5 factors: power distance, individualism, long term orientation, masculinity and uncertainty avoidance. On the basis of dominating values of those 5 factors countries are grouped in clusters. Our country - Poland belongs to “Solar System” cluster (characterized by high power distance, high uncertainty avoidance and high individualism) while UK and US to cluster named “Contest” (low power distance, high individualism, low uncertainty avoidance and high masculinity). Keywords for Contest countries are competition, freedom and clear rules while Solar System countries have dynamics of strong hierarchies opposing high individuality. ITIM publishes reports and analysis which show how cultural specifics affect business relations in areas like customer service, change management or dealing with risk.

Prepare both parties

We use the means mentioned above to prepare both parties teams to deal with  cultural differences in everyday work. This is usually 3 stages process.

First step is preparation. Our internal training center where ITIM International Polish partners are providing regular trainings to our managers to realize that cultural differences may seriously affect cooperation.

Nexts steps are applicable when we start new project or introduce new team to foreign country.

We start with internal training for our team. This training is performed by our managers or local partner if he participates.

As the last step with new customer or new customer team - we organize relaxed kick-off meeting on which we discuss cultural differences. Usually we do it in form of funny powerpoint presentation followed by discussion.

-- 

[1] Spencer-Oatey, H. (2008) Culturally Speaking. Culture, Communication and Politeness Theory. 2nd edition. London: Continuum.

[2] Computer Weekly web page: “Why more businesses are nearshoring in Eastern Europe”

Author: Leszek Czarnota / Business Development Director


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