NEW YORK-- Miscommunication and a lack of cross-cultural understanding can hinder the effectiveness of global sourcing, according to the results of a study released today by Accenture (NYSE: ACN).
The study, based on a survey of 200 U.S. business executives whose companies have outsourced business processes or functions ranging from information technology to finance and accounting, also found that executives believe adopting cross-cultural communication training programs can increase productivity by 26 percent, on average. This is consistent with the productivity increases of 30 percent reported by executives whose companies already provide training in this area.
Two thirds (66 percent) of all respondents said they had experienced miscommunication issues within their global sourcing operations, compared with 60 percent among executives at companies that offer cross-cultural training to their employees. That number increased to 72 percent for those whose companies did not offer any such training.
When asked to identify the chief factors causing problems between onshore and offshore workers, the largest percentage of executives cited different communications styles (76 percent), followed by: different approaches to completing tasks (53 percent), different attitudes toward conflict (44 percent) and different decision-making styles (44 percent).
These research findings bolster the real-life experience of global executives such as Kris Wadia, a senior executive in Accenture's Network of global delivery centers.
"In our view, the physical obstacles to outsourcing such as telecoms and facilities have largely been resolved," said Wadia. "However, the soft issues, particularly cross-cultural communication, will continue to present the main challenges to realizing global sourcing's full potential for the foreseeable future.
"Post-training feedback from the last couple of years suggests that long-term savings of both time and money are clearly possible if cross-cultural communication issues are identified - and resolved - at an early stage. There are also related benefits for companies, which include improved employee morale, and reduced attrition rates," Wadia added.
About the Survey
The online survey was conducted for Accenture in May 2006 by Sandy Radoff Associates. Respondents were based in the United States working in companies with revenue of US$1 billion or more who have experience of global sourcing. The survey of 200 executives covered professionals from multiple industries and executive levels, including C-suite executives, owners, vice presidents, department heads and directors.