Think Tank

The role of Culture and Communication in Offshoring
 
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Human Resource Management - firms eye cost cut & access to external skills as HRO benefits
Ahmedabad, Chennai, Kochi next BPO hotspots
Outsourcing - Service to be beyond Cost Savings
Getting to a Successful Deal


Human Resource Management - Firms Eye Cost Cut & Access to External Skills as HRO Benefits TOP

According to a recent study conducted by EquaTerra, a Texas-headquartered outsourcing advisory company, firms primarily outsource their HR functions to achieve cost savings, access external skills and knowledge, and process improvements. In addition, outsourcing of such functions will allow them to focus on their core business.

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Ahmedabad, Chennai, Kochi next BPO hotspots TOP

The next big outsourcing hotspots will not be from the usual metro cities but from Ahmedabad, Chennai, Hyderabad, Kochi, Kolkata, Mangalore, Nagpur, Pune, Thiruvananthapuram and Visakhapatnam, according to a study conducted by Alsbridge, an outsourcing, offshoring and shared services advisory firm.

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Outsourcing - Service to be beyond Cost Savings TOP

An Aberdeen Group study in July 2006 found that in a survey of companies outsourcing their software application to vendors in the United States and other countries such as India, "best-in-class" companies gain more benefits. These benefits included an increase in end-user satisfaction and a higher percentage of projects delivered on or below budgets. Best-in-class companies planned for and leveraged these efforts beyond just using cheaper labor.

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Getting to a Successful Deal TOP

Know the market, be clear about your motives, and use third-party advisors strategically. The stronger you begin the relationship, the more satisfied you’ll be along the way.

As the HRO industry grows, there is now a fund of experience on what needs to happen to ensure a successful, long-term deal. However, those embarking on a potential deal are often faced with conflicting views on what they should do and how they should proceed. Building on my seven years in the HRO industry, here are six priorities that every organization should heed.

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Think Tank

The role of Culture and Communication in Offshoring


TOP

Communication is the key to the success of any business. Ineffective communication is a major, yet avoidable, obstacle to business productivity. This becomes more prominent when organizations work remotely from different parts of the world. It not only highlights the differences in the language, people, culture but also the mind set of the people associated with the business. Bridging this gap can be quite challenging and if not handled well, can create problems in one’s business.

My experience has taught me that communication is primarily driven by a country’s culture and the way people think. Some cultures are very articulate while some believe in taking a round about route. Things and situations are interpreted in a very different manner in different parts of the world. This also affects people’s interpreting and writing abilities.

A customer once emailed a travel company to change his flight bookings since the flight he was booked on was very early in the morning. He wrote “If I took a flight that early, I would have to leave with the chickens”. The offshore customer service representative from a distant land and culture sent him a prompt reply “Our pet policy does not allow chickens on an airplane”.

In another classic and typical situation, the IT team of a company was talking to their outsourcing partner’s IT team. The conversation was regarding the backup work that needed to be done over the weekend. Here is what went on:

Client: So you guys understand that this work needs to be completed before the weekend ends?
Outsourcing partner: Yes, yes, we are aware.
Client: Good. I will keep my servers on and will take the back up once you are done with the uploading. Thanks for working extended hours to help us get this done. We appreciate this.
Outsourcing partner: Thanks! My daughter is turning 5 on Saturday. And I have the entire family coming over the weekend to celebrate the event.
Client: Oh, that’s great! Please wish her happy birthday on our behalf. Enjoy your daughter’s birthday with the family!
Outsourcing partner: Oh, sure! Thanks for the wishes!
Client: Ok. Talk to you guys next week! Bye!
Outsourcing partner: Bye!

So will the outsourcing partner IT person show up over the weekend? Will the work get done? The client is expecting the vendor’s team to finish the work as discussed and vendor thinks that he has communicated to the client that he would not be able to do it because he has to attend his daughter’s birthday party! Both teams are from different cultures. One has more direct approach while the other an indirect. This reflects in their conversation and leads to making assumptions, sometimes incorrect.

Lack of communication can also lead to dissatisfaction and can be detrimental to a business relationship. A team was trying to justify the errors that had taken place in the previous week Obviously the client was upset since the service levels were affected and wanted to find out what went wrong. Instead of accepting the errors and having an action plan ready, the team started providing justification to the client on the call. This made the client even more upset and the impression he got was that the team was trying to be defensive! Part of cultural training is to train people to accept mistakes and failures which sometimes are a taboo in certain cultures.

Two companies (referred here as company A and B respectively) outsourced similar work to a business process outsourcing company. The outsourcing company claimed to have three years of experience doing the same work. Company A had no formal training processes and worked in a very ad hoc manner. There was anxiety their work was being outsourced to a company overseas. The quality of work from the outsourcing partner was not evaluated regularly and timely feedback was not provided. In short, there was very little support provided to the outsourcing partner. On the other hand, company B’s team had all the training processes defined properly. They had defined a point of contact on their side and were readily available for support. Regular quality feedback was provided to the outsourcing company. The management team at company B explained in much detail to their operations teams that their jobs are not threatened and they would be focusing on more client relationship management type of work. During transition, there was daily interaction between the teams which made the team from the outsourcing company feel extremely comfortable. Guess which company was able to achieve better results? Obviously, Company B’s work transitioned smoothly and in shorter time.

An outsourcing company pride itself in its software team’s application development capabilities which had resulted in creating a paperless office. This became a much hyped feature. The client’s trainer came to provide on site training to the company’s team. The team’s manager was surprised to see that there was no printed material provided to the trainees to refer to what was taught in the class. After two weeks of training, when the final assessment started getting closer, the company’s manager finally asked the client’s trainer whether the team would get some training material to prepare for their final assessment. The trainer realized what went wrong! His interpretation of paperless office had stretched out too far! He or the company’s manager could have saved two weeks worth of effort had they discussed this earlier.

The bottom line is, when two companies work together, communication has a direct impact on the desired results. To ensure faster smoother transition and achieve desired results while outsourcing, companies need to take the following factors into consideration:

Culture – Understand the culture of the people you work with. It also helps to understand their level of exposure to various aspects of life.

Address employee expectations and apprehensions – When companies decide to outsource, there is an obvious apprehension among the employees about losing their jobs to some overseas company. A proactive approach of providing explanation of the reason to outsource and associated benefits helps.

Assimilation – Assimilation of expectations is very important. The outsourcing company needs to understand and accept your expectations.

Building relationships – Many times, the offshore teams are uncomfortable asking questions. They hesitate to argue and debate. A good rapport should be built between the teams. This will help the offshore team get rid of their inhibitions.

Training – Training should include not only the product and service content/manuals but also situations and scenarios of what can go wrong and ways to handle such situations.

Evaluation – Continuous evaluation (almost daily assessments) helps you understand a team’s performance and their level of understanding.

Defining milestones – This can be part of training as well as an ongoing process. It gives a sense achievement as well as clarity of expectations.

Apt communication – Never assume. Ask when in doubt!

Hope you have a pleasant and productive outsourcing experience!

Parul Mehta
The author is the Co-Founder and COO of Motif, Inc. a specialized BPO (Business Process Outsourcing) company providing rules based and decision intensive back office transaction processing services, customized email response services and internet research, analytics & database generation to global clients.

(www.motifinc.com)

 

  

About Motif

Motif, Inc. is a specialized business process outsourcing company serving Fortune 500 clients. Motif has demonstrated expertise in rules based back office transaction processing, which involves decision making and personalized customer support services. Our services include eCommerce Customer Support services,  Financial services - 401(k) Reconciliation services, Shareholder services, HR services - Benefits administration and Retirement services,  Mortgage services and  Internet Research & Analysis.
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