by Diann Daniel

How to Create a Good Relationship with Your Indian Vendor

Feb 09, 200710 mins

Despite the threat of commercial ascendancy from China, Russia and others, India still leads the pack as an offshore outsourcing destination, and its global presence is only growing. You need your Indian vendors’ expertise, you entrust them with many of your company’s secrets, and you depend on them for profitability. A good relationship benefits you both. But relationships are tough to build in the best of circumstances, and when you bring cultural differences and distance into the mix, misunderstanding and frustration can arise on both sides. Here’s how to bridge the U.S.-India cultural divide.

Background on Cultural Differences

Almost 68 percent of India’s exported IT and IT-enabled services are headed for the United States, according to the National Association of Software and Service Companies’ (Nasscom’s) Strategic Review 2007. This makes it that much more likely that American employees will be working with the staffs of Indian vendors. It also increases the need to look beneath surface similarities. “Most Indians we encounter in the United States speak English well, so it is not uncommon to underestimate cultural differences,” says Gunjan Bagla, principal at Amritt Ventures, a sourcing consultancy. He says this is a mistake, and recommends attention to those differences. For example, he advises CIOs to spend at least one week a year in India if they have significant business there.

Craig Storti, director of Communicating Across Cultures, also believes cross-cultural training is key. The most in-depth training should be aimed at the most-senior executives, he says. However, “pretty much everyone who works with Indians once a week or more needs [cultural awareness] training. The potential for misunderstanding is there.”

To understand that potential, it helps to look at the cultures of India and the United States in broad strokes. India is a deeply traditional group-oriented society; tightly knit extended families place a premium on harmony. Survival depends on interdependency, on keeping each other happy. “Your first goal is to make sure nobody is upset by what you say,” says Storti. “If the group is not strong, if it is upset by confrontation, you are in trouble.”

Compare that with America’s fractured families scattered throughout the country, an ethos of individualism and lore filled with Wild West cowboys and a promise that anything is possible if you work hard enough. The United States is a land of grab-for-it. Subtlety is the exception, in both speech and manner. And when an American talks, it’s usually to get his point across, not to create harmony.

Sweeping generalizations, yes. But a good relationship hinges on understanding how the environments of those involved can create contrasting styles of communication and management.

Missed Signals

Americans are raised to speak their minds; candor and being plain-spoken are admired. The primary goal of communication typically is to convey information, and this is especially true in a business setting. The primary goal of communication for an Indian, on the other hand, is to protect and strengthen the relationship, and that trumps information exchange, says Storti. An Indian finds it very uncomfortable to say anything you don’t want to hear, anything that would cause you to lose face or anything that would disappoint you. This is not to say that Indians do not communicate difficult information; it’s just that they do it differently. Common cues that difficult information is being sent your way: Your question is mirrored back to you, a postponed answer is not followed through on, or something is conspicuously not said.

You say: “Will that new schedule work for you?”

Your Indian colleague repeats: “Will that work for you?” Translation: “No, it won’t, but I don’t want to upset you.”

You say: “Can you have that ready by the end of the day?”

She says: “I will do my best.” Translation: “I foresee problems delivering the project by then, but I believe that information will make you unhappy.” She assumes you got the message, and you just heard the words. End of the day comes and the project isn’t ready.

Even a seemingly clear answer can carry an unexpected meaning. For example, “There are many layers to ‘yes,’ ” says Bagla, a native of India. It can mean, “I understand what you said. It can be a simple acknowledgement that I heard you,” he says. You must get further confirmation. This is especially true if you are working by phone. Written clarification and confirmation is crucial.

Giving Clear Instructions

During a workshop for Indian employees of a leading American retailer, Storti posed the question: “When your American bosses tell you about coding they want you to do, and you don’t understand, what do you do?”

The group answered: “We talk amongst ourselves to see if anyone understands.”

Storti: “But what if nobody understands?”

Group: “We would just try something and hope it works.” In other words, they are more likely to chance doing the wrong thing than to ask for clarification. Why? In Indian culture, asking a boss to clarify instructions is tantamount to saying he doesn’t know the subject well or didn’t explain it well, says Storti. “Questioning the boss can be seen as shaming him.” 

On the plus side, says Storti, Indians are “very keen to do what clients want.” But just as Americans need education to best communicate with Indians, Indians need similar training to best communicate with Americans. Most importantly, make it easy for your Indian staff to ask you questions. For example, “We’ve covered a lot of territory. I myself didn’t understand it well; I would love it if you asked me questions.” Storti recommends a four-step process for bridging this communication gap: “1. give advice; 2. do it again; 3. wait for them to get comfortable; 4. praise, praise, praise.”

Speaking of praise, a word about its opposite—criticism—should be noted. Bagla recommends softening criticism by stating it as a question or speaking about it privately. “In the United States,” says Bagla, “colleagues can express disagreement or criticism with one another quite freely and still have high professional regard. But some Indians tend to take criticism very personally.”

Contract Negotiations and Deadlines

In the United States, a contract is typically regarded as binding, unless something very specific changes. Only then is renegotiation back on the table, and then only for a specific reason. “The process [of contract negotiations] may take longer than Americans are used to, and once the agreement is signed, don’t be surprised if the Indian company brings up something for renegotiation,” says Bagla. In India, a contract is but a small part of the business partnership. The relationship and trust are seen as much more important, says Bagla. Your Indian partners may be so focused on strengthening that relationship, including doing unbilled extra work, that they miss the fine print of the contract. But once into the day-to-day of carrying out the contract, they realize certain requirements are challenging. In this area, as in others, it pays to understand the cultural context in which your vendor operates. Take the initiative on courting open communication about difficulties as well as foreseeing potential problem areas to discuss. Don’t wait for your Indian colleagues to come to you with problems. You should actively encourage feedback and communication, and also try to think from their point of view if certain deliverables might be problematic.

Americans should also pay special attention to issues of time. “Generally, in the West if we say we’ll be there at 10:00, we mean 10:00. In India, if you are there at 10:25, it’s not the end of the world,” says Bagla. This more elastic view of time sometimes extends to project delivery dates. Bagla recommends being very specific about dates, and getting confirmation that those dates are understood in the same way. In India, “the end of January” could mean anywhere from Jan. 20 to Feb. 3, he points out.

Management Style

It doesn’t matter what your line relationship is with Indians; if they are your vendor they will tend to think of you as their boss in the broader context, says Storti. That is important to know for a few reasons. Your Indian staff may repeatedly come to you for guidance even though you have enabled them with autonomy, or they may bypass someone you have assigned as a project leader because you are “the big boss.” In contrast to your American employees, they may also prefer close guidance and supervision, which you might consider micromanagement. “This may be a bit different for younger, hip, urban Indians,” he says, “but not that different. Less Indian than their parents doesn’t make them Western.”

Storti says that traditional Indian culture encourages employees to follow instructions to the letter, and discourages deviating from scripts. Despite their talent and competency, they may feel it “not their place” to generate solutions of their own. They are not likely to say, “These instructions are not working for this project,” although younger Indians may, in a very polite way, question what they think is bad advice.

Since many companies that are outsourcing look for consultants who can offer process improvements, this can be frustrating. They may feel they are not getting the level of contribution that they are contracting for. To combat this, encourage your Indian staff to speak up, and give positive feedback when they do it, using clear, specific examples.

All this said, it is a mistake for clients to assume a superior attitude, says Bagla. India’s success is only growing, and today’s vendors have increasing pride and confidence. “If you treat the vendor as an equal, this mutual confidence will translate into better service, more constructive and productive ideas from the vendor and a smoother working relationship,” he says.

Creating a Virtual Watercooler

Like all long-distance relationships, bonding with colleagues in India takes extra work. But creating relationships and community can go a long way toward a successful partnership. Bagla recommends creating a virtual bulletin board where employees from both countries post short informal bios that extend to after-work hobbies. “This gives people the ability to converse and makes them more comfortable with one another,” he says. Americans may find themselves paying attention to cricket, and Indians may understand why the Super Bowl takes over our culture at a certain time of year. American TV (especially CNN) and Hollywood movies are quite popular in India and offer a common basis for small talk.

It’s worth remembering India’s group-oriented and sociable society. Don’t be offended if your Indian colleagues ask you about your family, religion, political beliefs or even your home. Such questions are not meant to be intrusive. Politics and religion are freely discussed in an Indian workplace, as are personal subjects an American may deem private. “On the flip side, some Indian vendors have told me that they felt slighted by their long-term clients,” says Bagla. “If the vendor is doing a good job, some heartfelt hospitality and appreciation from you as a client is a good idea.”

India’s global presence is expanding—even beyond IT. That means when sales, marketing and purchasing have questions about working with companies in India, they may find their in-house source of expertise—the CIO. Just one more way IT leaders can become thought leaders.

Associate Online Editor Diann Daniel can be reached at

Additional resources:

A native of India, Gunjan Bagla is the principal at Amritt Ventures, a U.S.-based advisory service that helps North American companies do business with India and China.

Craig Storti, director of Communicating Across Cultures, is an author and consultant in the field of intercultural communications and cross-cultural adaptations.