Cultural challenges in IT outsourcing and how to deal with them
Published on May 24, 2021 Last modified on June 02, 2021
As we’ve mentioned in the previous blog, cultural differences aren’t really responsible for problems encountered in cross-cultural collaborations per se, more than the way that people adapt and work with it. With that being said though, when left unrecognized, these differences can lead to a mismatch of expectations that in turn can eventually cause problems for the project.
Problems ‘caused’ by cultural differences
1. Misunderstandings and miscommunication - A conversation between low-context and high-context communicators can lead to misunderstandings.
For example, a high-context communicator usually assumes a great deal of commonality of knowledge and views with the message receiver, and trusts their ability to infer the meaning of the message from what’s being said. On the other hand, someone who’s more used to low-context communication will accept the message at face value without any further inference.
This difference in expectations can, or rather will, lead to misunderstandings of instructions and false or incomplete assumptions about aspects of the project.
2. The “mum” effect - The mum effect refers to an individual’s tendency to withhold bad news for fear of undesirable consequences. This is more commonly observed in collectivist societies like in some Asian countries — due to factors such as the concept of seniority and emphasis on harmony (which can lead to hiding negative issues to protect the team).
The mum effect can be harmful to a project, especially if mistakes don’t get resolved because they go unreported for a long period of time, or are hidden altogether until a time that they cause serious issues — at which point it will be too late or very expensive to fix them.
3. The concept of “saving face” - Closely related to the previous one is the concept of “saving face” that’s at the core of most Asian cultures. Influenced by factors like hierarchy and collectivism, “saving face” often prevents people from speaking up, not only about mistakes as discussed above, but also in challenging ideas that may not be the best for the project.
4. Loss of productivity - Miscommunication can result in loss of productivity, especially since fixing errors takes valuable time that could have been spent in developing the project further.
5. Strain in the relationship - The fundamentally different ways of thinking and styles of communication between cultures can eventually lead to a strain in a supplier-customer relationship.
For example, low-context communication can appear far too direct for someone who’s more used to high-context communication. In individualist cultures, calling out the mistakes of other people is standard and seen as necessary for a project, something that might be considered offensive in others.
How 1902 Software deals with cultural differences
At 1902 Software, the key thing that we do to address the inevitable cultural differences that come with working with customers who are from other parts of the world is to build an organizational culture that’s flexible and constantly adapts to different cultural challenges.
In a survey on mum effect and its influencing factors, it’s found that while national culture does have an influence on this behavior, such influence is not especially strong and could be suppressed by a strong organizational culture. We believe the same is true for most of these common values, so here are our practices to deal with cultural differences:
1. We occasionally hold casual cultural workshops, where employees are exposed to the culture and way of thinking of our customers (most of which are from the West).
2. We make sure to always be on time for meetings as scheduled.
3. We answer all emails before going home — we try to avoid falling into the mum effect by having a proactive approach to problems. Even if we don’t have solutions ready, we make sure to inform customers and keep them updated if ever there are issues.
4. We go with low-context communication in our correspondences. This is because we recognize that in a remote collaboration context where meetings are done over the Internet, high-context communication can only lead to misunderstandings.
5. We generally avoid pointing out differences unless it serves a specific purpose. At the end of the day, while it’s definitely important to consider nuances in culture, the most important thing is still the shared objective of successfully completing the project!
In outsourcing, the burden of adapting to the culture usually rests with the supplier. After all, if there are problems due to cultural differences, it will mostly reflect on the service quality. Still, it will benefit you as a customer to learn how to work with different cultures from your own.
Tips on dealing with cultural differences
If you’re planning on outsourcing, especially to an offshore company with a generally more different culture than what you’re used to, here are tips that can help you:
1. Right from the start, include “cultural fit” in your criteria for choosing the right supplier. It might not be as important as budget fit or expertise and experience but in the long run, choosing a company that you know you can work well with will help a lot in ensuring a smooth collaboration. Find the perfect balance between these factors.
2. Before you start the project, make sure that you have set clear expectations for communication and working together. It could be as simple as setting weekly status meetings, or having more defined metrics for communication with the team that you’ll be working with.
3. Keep an open mind. Like we’ve mentioned in the previous section, each person tends to consider his own way of thinking the most important and the correct way. As you work with another company, try to see and understand things from their point of view.
4. Related to the third tip — take advantage of the benefits that cultural differences bring. Different cultures have different perspectives that will be useful when solving problems. Embrace this diversity.
At the end of the day, it’s about a balance of being aware of cultural differences, taking them into account in how you work, and recognizing that they are not the barriers to a successful collaboration that they’re often made out to be.
If you think you can gain from the benefits of outsourcing, then don’t let differences that can be resolved with an open mind and willingness to cooperate prevent you from taking advantage of them.
If you’re interested in learning more about how to work amidst cultural differences, contact Peter and he’ll be happy to share more tips and know-how with you.