{"id":1638,"date":"2010-08-13T12:10:00","date_gmt":"2010-08-13T12:10:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/work-cultures-081110\/"},"modified":"2010-08-13T12:10:00","modified_gmt":"2010-08-13T12:10:00","slug":"work-cultures-081110","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/work-cultures-081110\/","title":{"rendered":"Is it time for Western and Indian services cultures to blend?"},"content":{"rendered":"
\"\"<\/p>\n

we'll be happy to deliver that to your door for an additional $20…<\/p>\n<\/div>\n

Today’s outsourcing\u00a0industry is balanced on a knife-edge as costs\u00a0continue to\u00a0level-out across service providers for operational work.<\/strong>\u00a0\u00a0\u00a0Business leaders are demanding more innovation<\/a> and productivity from their outsourcing endeavors, but their delivery teams tend to be\u00a0more concerned with the work culture of their provider.\u00a0<\/p>\n

So how can leading service\u00a0providers deliver all the goodies CFOs and CIOs want,\u00a0in addition<\/em> to\u00a0being really flexible and easy to work with?\u00a0 Quite an ask, but those who can deliver both<\/em> will win out.\u00a0 So how did we arrive at this impasse?<\/p>\n

During the early years of this Millennium, the onslaught of the Indian-headquartered outsourcing providers\u00a0was\u00a0centered on\u00a0low-cost service provision, and a willingness to do whatever clients wanted<\/em> to win the business.\u00a0 This strategy has proved especially effective for the less-complex IT application development and maintenance work, and several operational business processes, such as invoice or claims processing.\u00a0<\/p>\n

In today’s market, the Western providers have been forced to bring their costs in line \u00a0to be competitive for the “lower-end” work, by expanding and optimizing their offshore\/nearshore operations.\u00a0 Once their prices are within 10-15% of the offshore-centric providers, the provider selection decision<\/a>\u00a0veers away from price, and towards one of\u00a0 with whom do we actually want to work?\u00a0 <\/em><\/p>\n

Two different\u00a0services cultures have defined today’s outsourcing business<\/span><\/strong><\/p>\n

We\u2019ve witnessed an incredible dichotomy of styles in the outsourcing business over the last decade<\/strong> –\u00a0\u00a0one of top-down dictation from our traditional\u00a0incumbents, in stark contract to the bottom-up tenacity from our growth machines from the sub-continent.\u00a0 To put it quite simply, the Western incumbent providers show up at the CIO\u2019s or CFO\u2019s office and tell her\/him how they can change their world to do things their way<\/em>, while the Indian-headquartered providers have typically operated a rung or two down, offering to do whatever their clients need to get the job done \u2013 and make them look good in the process.<\/p>\n

One set of providers has grown considerably over the recession years, and continues to outperform the industry, while the other is maintaining a status quo, with far more modest growth.\u00a0 And, as we’ve mentioned, it\u2019s not all about price anymore \u2013 several hundred thousand Indian and Philippines citizens are proudly showing up to work in an Accenture, Capgemini , Deloitte\u00a0 or IBM polo-shirt.\u00a0 Both the traditional providers and the newer Indian breed can offer low-cost services to take on new business.\u00a0\u00a0So if\u00a0it\u2019s not really about cost anymore,\u00a0and the Indian-headquartered providers continue to gain marketshare in this environment\u2026 the secret sauce must really\u00a0be\u00a0about work culture.\u00a0 <\/em>Let’s examine further…<\/p>\n

C-levels don\u2019t get so involved in service provider selection.<\/strong>\u00a0 Most IT or discreet business project decisions are overseen by the direct report to a C-level (or even lower than that).\u00a0 If you\u2019re a VP \/ director level executive, why would you want some flash MBA-infused team of hotshots telling you what to do, while constantly trying\u00a0reach over your head\u00a0to your boss to let him (subtly) know you could run your department a lot smarter, and more cost-efficiently?\u00a0 In this post-recession environment, people are incredibly nervous about their job security, and the last thing the VPs and directors want is a provider that is going to threaten their cosy world.\u00a0<\/p>\n

Conversely, a team of humble, dedicated and determined service provider staff, who see you as king of their world, and are prepared to do anything for your business \u2013 and promise you outcomes you probably realize are unrealistic (but who cares, right?), are far more appealing providers for your custom.<\/p>\n

Peer pressure up the chain trumps a round of golf.<\/strong>\u00a0\u00a0 In the old days, when CIOs were wined-and-dined at offsites in Monte Carlo, they made the provider selections.\u00a0 They could afford the occasional $100m project-wastage and no one really cared (hey \u2013 it\u2019s just IT, right \u2013 it\u2019s just a black hole of lost cash, right?)<\/p>\n

Today, most CIOs are tied to their desks staring at a spreadsheet trying to keep within budget, while\u00a0trying to prove they can deliver value\u00a0to their board – they are in a pressure-cooker environment, with ever-decreasing tenures.\u00a0 They are completely reliant on their teams to bring them results.\u00a0 When their two, three, or four direct reports come to\u00a0you with\u00a0a suggestion to \u201cuse this provider\u201d, it\u2019s very hard to challenge a consensus from your own team \u2013 you\u2019re the boss and you need you team to like you, or you’re in serious schtuck.\u00a0 You don’t have time to mess\u00a0up, and you may be out of a job soon anyway, so short-term\u00a0success works better for you anyway.\u00a0 If you recommend your consulting partner buddy (who just three-putted to let your win on the 18th) propose work for your managers down the ranks, the chances are they\u2019ll find every excuse not to use them.\u00a0\u00a0 If your team isn’t happy and you’re making multi-million dollar investments, you can’t afford mistakes, or a lot of dissention from the ranks beneath you.\u00a0 Might be easier just to keep everyone happy as long as you’re\u00a0staying on budget.<\/p>\n

So what can the CIO do?\u00a0 Risk upsetting your team, or keep the costs low and find a way to keep the machine ticking over and meet the operational goals?<\/em><\/p>\n

The next wave or productivity requires a new approach from the industry.<\/strong>\u00a0 Quite simply, most of the managers, a rung down from the CIO, have squeezed as much as they can out of the easy work.\u00a0 The app support, the testing, the simple coding is running about as cheap as you can \u2013 you even bring in sourcing advisors to keep the contracts running as low as you can manage.\u00a0 There\u2019s no more room for maneuver. That nice Indian head-quartered\u00a0provider \u2013 who still loves you as much as the first day they showed up at your office \u2013 can\u2019t find anymore wiggle room to keep making you look good.\u00a0 Besides, today they\u2019re a multi-billion dollar eneterprise with a lot more overhead,\u00a0and have sales heads forcing them to start raising prices.\u00a0<\/p>\n

At the same time, some of the old Western providers you abandoned a couple of years ago, can now match the prices you\u2019ve just been quoted from the \u201clow-cost\u201d provider.\u00a0 They want you back and are begging for that second chance, promising delights that you forgot that failed to deliver in the old days\u2026. WHAT DO YOU DO?<\/p>\n

Bottom-line: the Indian providers are trying to be more like the Western providers, and the smart Western providers have studied the Indians who\u2019ve been eating their lunch, and\u00a0are working\u00a0out a game plan to win back lost business.\u00a0 The cultures are moving closer together.<\/strong><\/p>\n

Does that mean we may actually see one of the Indian biggies merge with a Western one?\u00a0 I\u2019ll put a stake in the ground and say we will. In the next year it has to happen \u2013 a blending of the two cultures to form a mega-provider which can do it all.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

we'll be happy to deliver that to your door for an additional $20… Today’s outsourcing\u00a0industry is balanced on a knife-edge…<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,81,832],"tags":[435],"organization":[],"ppma_author":[19],"class_list":["post-1638","post","type-post","status-publish","format-standard","hentry","category-business-process-outsourcing-bpo","category-it-outsourcing-it-services","category-sourcing-best-practises","tag-indian-outsourcing"],"yoast_head":"\nIs it time for Western and Indian services cultures to blend? - Horses for Sources | No Boundaries<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.horsesforsources.com\/work-cultures-081110\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is it time for Western and Indian services cultures to blend? 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