Culture has often been cited as one of the biggest barriers to
successful offshore outsourcing. While we all know and agree that that is the case, and often
talk about it, not all of us understand specifically how different cultural aspects show up in
offshore projects and how the resulting barriers can be addressed.
To know more about how culture differences show up, one can either rely on research
studies or on first hand observations and experience. When it comes to research, Geert Hofstede’s
work in identifying cross-country cultural differences based on five measures: power distance,
individualism, uncertainty avoidance, long-term orientation and masculinity, is a good starting
point. A few examples: Western countries like U.S. and U.K. are more individualistic compared to
the collective culture in Latin America and Asia; Asian countries like China and Japan score high on long term
orientation while western countries are more short-term oriented. Richard Nisbett, a social
psychologist, found that Easterners perceive objects holistically through a wide-angle lens whereas
Westerners perceive them in isolation, through a narrow lens with sharper focus. Another study
looked at culture and mum effect, which occurs when one or more stakeholders who have information
indicating a project is failing decide to remain silent and let the project continue. It indicates
that the risk of mum effect is higher in Asia than in the West. Of course, there are caveats and
assumptions in these studies so they should serve only as initial anchors rather than absolute
First hand observations and experience bring out much more specific aspects. For example,
Utkarsh Rai, author of Offshoring Secrets highlights specific aspects of the Indian
culture that show up while managing offshore projects—the compare and contrast culture, the
workplace socialization practices, the importance of age and seniority, the sensitivity to
criticism and the difficulty in saying no. This is in stark contrast with some elements of the
western culture—the directness of criticism, the slightly circumlocutory style of
communication and the focus on productivity in U.K. and the informality of work culture, the
direct but sometimes overbearing style of communication and the “it’s all about time
and money” approach in the U.S.
These cultural differences impact interactions, communication, interpretation, understanding,
productivity, comfort and commitment.
So how can we address them? Companies have adopted two routes so far: cultural awareness and
culturally compatible resource deployment. Cultural awareness involves conducting workshops and
sessions both offshore and offshore to make both sides aware of each other’s cultural practices. In
fact, such sessions are now included as a freebie in many large outsourcing programs. Culturally
compatible resource deployment involves having local, native onsite persons manage the onshore
client relationship or even having a culturally compatible offshore workforce (example U.K. and South Africa). The
two things to be kept in mind while doing this are firstly whether the cultural barrier is
addressed internally within the service provider’s organization and secondly if the erosion of cost
advantage is worth it.
Beyond the above, obvious solutions, companies need to keep three principles in mind to fully
address cultural barriers. The first principle is that it is a two-way street. A director of a
leading cultural training institute in U.K. once told me of an incident where his (not yet then)
client in U.K. was complaining “the Chinese don’t know how to work with us. The Indians don’t know how to work with us”. The director retorted, “Have you ever considered
that you may not know how to work with them?” So it’s as much about the buyer understanding the
supplier’s culture as the other way round.
The second principle is that it takes conscious effort, intention and patience for cultural
awareness to show up in our behavior. There are two systems in our mind—System 1, the
intuitive part, and System 2, the reflective part. Our native cultural factors are in System 1, and
when we learn about a new culture, it gets slotted in System 2. So unless we practice and reflect
about the new culture, the intuitive aspect of our own culture will still be the only driver.
Scientists have also found that our childhood cultural experience plays a major role in shaping the
way we think and as we grow older, the neuroplasticity of our brain actually reduces, making change
The third and most important principle is that addressing the cultural barrier requires a shift
in individual thinking. Each culture brings in its unique perspective, and that’s what is required
to solve today’s complex problems. But we listen to other cultures through our own judgments and
prejudices. We have to be willing to let them go, to accept another. How we see other people and
their differences is merely a point of view.
And no one point of view is the only true or correct one.
Arpit Kaushik runs the London-based outsourcing service design firm, Crystals, that helps forward-looking companies to realize
the promised benefits of outsourcing.