Co-Sourcing: Offshoring Requires an Awareness of Cultural Differences

Successful co-sourcing is all about client and vendor meeting each other halfway. And that goes beyond the exchange of technical skills and business knowledge. Communication and cultural awareness are also important, say CIOs.

State Street, which co-sources application development with UniverseSoft Technology in China, holds cultural and language classes for its Boston-based employees. “They learn things like how to address their Chinese counterparts, pronounce their names, et cetera,” says Jerry Cristoforo, CTO and executive VP of enterprise information and global markets technology services. “The problems that you usually think about with outsourcing—coding, policies, processes—are just the tip of the iceberg. The hidden parts are the values and the culture of the people involved. You have to be sensitive to that if [an outsourcing] program is to be successful.”

Michael Agnew, managing director of Omgeo, visits his co-sourcing partner in Mumbai twice a year and never arrives empty-handed. “I bring gifts to my partners. Even though I’m the customer, I take them out to dinner, which is not usually the way things work with clients and vendors,” he says. “They know we’re happy customers and, knowing they’re appreciated, they’re inspired to perform. You have to treat your partner the way you would want to be treated.” –S.O.