Project management working with on-site and offshore teams

Hewlett Packard

The Author

Iain Wilson is the Delivery Manager EMEA for Software Engineering Services in Hewlett Packard, having responsibility for delivery of software engineering projects in Europe. Previous to this role, Iain was Project Director with Hewlett Packard, working on large System Integration projects. Iain was also responsible for implementing HP's standard Project Management Methodology, for his division in Europe

Iain has been with Hewlett Packard for 18 years, the last twelve in project management. From 1994 – 1997 Iain managed major projects for Hewlett Packard in Detroit Michigan, leading a team of 30 people working on Automotive Diagnostic systems implementation. Iain is a member of the Project Management Institute, a Project Management Professional (PMP) and is a Member of the Institute of Electrical Engineers (MIEE)

Iain has recently completed a MBA from the Open University Business School and graduated from the Bristol University, UK with a B.Sc. in Electrical & Electronic Engineering in 1978.

Purpose and Objectives of the Paper

The purpose of this paper is to look at the impact of different cultures on the make-up and performance of multi-cultural teams, focussing in particular on the advantages and challenges of working with teams that are split between on-site (with the customer) and offshore (for example India).

Due to the nature of projects from which examples and experiences are taken for this paper, it tends to major on IT projects and on projects that are developed for trade customers, rather than executed internally.

The objective of this paper is to help Project Managers

  1. Take into account cultural issues when working with multi-national project teams
  2. Understand the advantages and challenges when working with on-site / offshore teams
  3. List a series of best practises in terms of issues to be taken account of when planning and executing multi- cultural or multi-centre projects

The paper will first look at the work of Hofstede (1994), who identified four traits that differentiate national cultures, Power Distance, Uncertainty Avoidance, Individualism / Collectivism and Masculinity / Femininity. The paper will then look at some practical examples of the benefits and challenges of multi-cultural teams, particularly with reference to working with split teams, both on-site with the customer and offshore in, for example, India or Russia. This session will focus on issues of project governance, advantages of time difference, management of different cultures, decision-making and lessons learnt.

A list of further reading will be presented at the end of the paper.

National Culture

Culture is a much used word, the old joke being - what is the difference between San Francisco and a yoghurt .. Yoghurt is a living culture ! Or Ghandi's response to the question “What do you think about Western Culture?”, his response, “It would be nice if they had some”. Generally, there are three types of culture identified (Henry, 2001):

National Culture
Organisational Culture
Professional Culture
  • - based on long established shared values
  • - behaviours and attitudes within a particular company
  • - behaviours and attitudes in a particular profession, Project
    Managers or Doctors for example

As part of my MBA studies, I came across the work of Geert Hofstede (1984) who undertook a landmark study for IBM, looking at national cultures. One of reasons this struck a cord was that I work for Hewlett Packard, a very similar organisation. Hofstede identified four work-related differences in National culture, which are shown below.

Power Distance – relates to how hierarchical the organisation is seen, the distance between subordinates and superiors.

Uncertainty avoidance – how much ambiguity is tolerated by individuals versus the requirement for rules, an individual or a group attitude to risk.

Individual vs. collectivism – Me versus the team, self interest vs. the rules of the team or group.

Masculinity / Femininity – head versus heart, work goals vs. personal goals

Hofstede rated each country as either high or low on each of these dimensions.

Hofstede highlighted how different nationalities scored on his four scales, as shown in the following table.

Power Distance Uncertainty Avoidance Individualism Masculinity
1 More developed
Latin
High High High Medium Argentina,
Belgium, Brazil,
France, Spain
2 Less developed
Latin
High High Low A range Chile, Colombia,
Mexico, Peru,
Portugal,
Venezuela,
Yugoslavia
3 More developed
Asian
Medium High Medium High Japan
4 Less developed
Asian
High Low Low Medium Hong Kong, India,
Philippines,
Singapore,
Taiwan, Thailand
5 Near-Eastern High High Low Medium Greece, Iran,
Turkey
6 Germanic Low High Medium High Austria, Germany,
Israel, Italy,
Switzerland, South
Africa
7 Anglo Low Low/
Medium
High High Australia, Canada,
Ireland, New
Zealand, United
Kingdom, USA
8 Nordic Low Low/
Medium
Medium Low Denmark, Finland,
Netherlands,
Norway, Sweden

Table 1

You may not totally agree with these results, but there are other factors.

National cultures are based on long established values, however, these behaviours can be modified by a strong organisational culture, and behaviours that are rewarded by an organisation may modify, but not totally obscure national cultures.

It is also a fact that there may be larger differences within a nationality than between nationalities; some examples are North and South Italy, East Coast, Mid-West, West Coast U.S.A. and North or South Germany.

How long a particular group has worked together will make a difference in behaviour. As a team goes through the Forming, Storming, Norming and Performing phases, the impact of national culture versus organisational culture will change, for example, team vs. individual goals orientation.

Impact on Project Teams

So how do these factors impact project teams and Project Managers? Remember there are at least two organisational scenarios where some of these factors will have an impact.

  1. Within the project team - there are multiple nationalities
  2. The supplier customer relationship, where the project team may consist of different nationalities and therefore different national traits, from the customer.

Here are some scenarios, taken from real life experiences.

The first one looks at a German Project Manager and a predominately Indian project team, just looking at two of Hofstede's dimensions;

  • Power Distance:

    Germanic Project Manager will want local team to make decisions (Low)

    Indian team will tend to look to the project manager to make decision (High)

  • Uncertainty Avoidance:

    Germanic Project Manager will want to “play strictly by the rules” (High)

    Indian team will feel better with some ambiguity and flexibility (Low)

Another scenario, look at an Anglo project manager and a Nordic team;

  • Masculinity

    Explicit Anglo - information, data, rules, decisions (High)

    More tacit Nordic Project team, nurturing, caring, team-orientated.(Low)

However, if the organisational culture were more project or team orientated, this would have less of an impact.

From a customer supplier angle, consider a Swiss Customer and a US supplier working with an offshore team in India:

  • Uncertainty Avoidance

    The Swiss (Germanic) customer is saying, “I have a contract, I expect 100% (better 120%) delivery” - to the letter of the contract, essentially the contract drives the deal, a real need for rules.

    The US (Anglo) have less need for rules “I'll deliver 80%, the rest will change and be renegotiated anyway”.

  • Power Distance

    The Germanic and Anglo low power distance will allow decision making at all levels

    The Indian team are (High Power Distance) waiting for decisions to be made

A further example, a Dutch customer with a German vendor,

  • Uncertainty Avoidance

    Germanic, high uncertainty avoidance, define, agree, plan, deliver

    The Dutch (Nordic) low uncertainty avoidance “let's get started”, don't plan too much, compromise (change the plan/agreement)

An interesting question, which is probably the subject of another paper, Which national culture would you see as making the most natural Project Manager? or would the natural Professional culture of a project manager overcome the national culture ?

The Role of the Project Manager as an Arbitrator of National Cultures

The Project Manager has a key role in both increasing the positive impact of the cultural differences and reducing the negative impact. Trompenaars and Hampden-Turner in their book Riding the Waves of Culture (IV), talk about three steps;

  1. Awareness of Differences
  2. Respecting Cultural Differences
  3. Reconciling Cultural Differences

By recognizing some of the issues that may surface as highlighted above and by planning to maximize advantages and minimize disadvantages, as shared in the lessons learnt, the Project Manager is on the right road to building a successful, multi-cultural team.

Advantages and Disadvantages of Multi-Cultural Teams

So, from my experience, what are the advantages and challenges of multi-national teams? You can spot the organisational culture; we don't have problems in HP, only opportunities or challenges!

In one way, there is no choice here, business is multi-national, this is not a theory, but a fact! Hence, the ability to work in this environment becomes a business fundamental, not a breakthrough. Certainly in the IT work, there is also an increasing focus on offshore work, as the quotations shown illustrate –so, you IT project managers, get used to it!

  • Forrester Research estimates that demand for offshore outsourcing will account for 28% of IT budgets in Europe & US within two years
  • Spending on offshore development by US companies will soar from $5.5 billion in 2000 to $17.6 billion within two years. During the time, the number of offshore IT workers will grow from 360,000 currently to over 1 million - IDC
  • “Clients are now banging on our doors demanding data on where they should go for offshore development …. where they can find the best resources & the highest quality for the lowest prices” – Gartner Group

Advantages

Hofstede, in his book Cultures and Organizations (1991) talks about the Competitive Advantage of different cultural profiles, the potential impact of forming a diverse project team;

Power Distance Small ; Power Distance Large
acceptance of responsibility Discipline
Collectivism Individualism
Employee Commitment Management Mobility
Femininity Masculinity
Personal Service Mass production
Custom-Made Products Efficiency
Uncertainty Avoidance Low Uncertainty Avoidance High
Basic innovation and research Precision

I have certainly found it rewarding, working in a multi-national, multi-cultural organisation. It looks good on the resumé and I genuinely believe it enriches the work experience.

One interesting side effect is that, as you work in multi-national teams, you may be building capability or domain expertise in a country that did not have it before. The team members in that country may then be able to use that expertise locally, leading to opportunities to build the business. Working with offshore teams, this has worked in both directions, the “European” teams become more comfortable with the capabilities and processes of the offshore teams, the offshore teams have learnt specific solution skills that can be used in their own country

The ability to “follow the sun” using technology. In a time crunch to finalize a presentation, it is possible to start the work in Europe; carry on in California, complete in India ready for Europe the following morning!

Challenges

So, from experience, what are some of the challenges? Communication – clearly, communication is easier in a single cultural, co-located team. The challenges start with multicultural, co-located teams and get more challenging for multi-cultural, multiple location teams – some of the lessons learnt are described later.

Same with Project Governance, what are the roles and responsibilities in the team, what are the decision-making processes and do they account for different cultures

Cultural awareness – works both ways, I believe there is a natural tendency to think “I must understand the other culture”, I believe you also need to look at yourself and think, what cultural traits do I have that may be different from other nationalities, how does my behaviour look to someone from a different culture. The following is an excellent example of this, based on the chemical company, ICI.

British Perception of Italians Italian Perception of British
Excessively flexible Obsessed with rules and procedures
Entrepreneurs Inflexible
Creative Formal
Rely on people not structures Avoid confrontation
Emotional Inhibited / hide emotions
Undisciplined Disciplined
Never meet deadlines Good planners
Not very time-conscious Suspicious
Averse to planning Slow and ponderous

Time and Distance – this may sound like Project Management 101, but it is important to remember the impact of time and distance on your project planning, it physically takes time to ship stuff from India to Norway, there may be import restrictions on computer equipment or software licenses, work permits can take time to get. What time do you hold a project review, when your team is in California, Germany and India, public holidays are different in different countries, weekends are different, particularly in the Middle-East

Cultural differences can also make a major difference in project control. One reality is that it is likely a large number of work packages will be developed remote from the Project Manager, so there needs to be a reasonable degree of trust. This degree of trust can take time to develop. One way this is manifest is in problem identification. A low power distance, high trust culture will allow problems to be communicated quickly “I've got a problem, but here is my plan to fix it”. This may not be the case with High Power distance and where the trust has not developed. An Indian development team may hit a problem. Their natural tendency is to try and fix it by working hard, whilst, potentially, not highlighting the issue to the Project Manager. This can result in a lot of frustration for the Project Manager, as there do not appear to be problems, but slow progress is being made. In one experience, a problem with National Language settings caused a problem for weeks offshore but once revealed to the on-site team was solved in minutes by a local engineer who had seen the problem before.

Lessons Learnt (What to Plan For)

I've put the lessons learnt in terms of PMI Knowledge Areas. These are “generic” lessons learnt from a number of multi-national, multi-centre projects. Some are very specific actions to do; others are areas to watch for cultural differences.

Integration

In terms of planning, if possible, to have a kick-off meeting with everyone in the same physical location. There is, of course, a cost of doing this, but I believe that this cost is easily recovered in the course of the project, in terms of better relationships, helped by a face-to-face meeting. Use this meeting to build a team spirit by having well defined goals and objectives for the project, introduce a team name or symbol and define all the communications processes, when, how, technology, escalation plans etc. and get agreement on these from the whole team.

Your planning tool needs to handle separate work streams in separate locations and different time zones, plus remote access

Simple, but easily forgotten, plan for the public holidays in each location Visas can become an issue; it can take time to get them

It is even more critical than normal to carefully define roles and responsibilities – as you cannot “see” what people are doing day to day, it is important that there are no holes or overlaps in responsibilities.

In project control, remote working puts strains on control and reporting. Clearly, it takes time to build trust and to develop an open environment where any issues can be raised without fear, or personal embarrassment. It is necessary to drive rigorous planning and monitoring, follow the guidelines for a WBS (no task greater than 80 hours) and to make sure progress is monitored against each task and hold frequent (weekly?) update meetings or tele-conferences in which all open issues are driven to closure. It is also necessary to emphasize team working and team responsibility, rather than individual tasks and failings.

Scope

For IT projects, remember that National Language settings can make a big difference. One project team spent ages looking for a problem with data sorting .. it turned out they were using a standard character set, the data had Nordic characters in it!

Another scope issue is whether there is a requirement to translate documentation between delivery centres, this will also have an impact on time and cost!

From a contractual point of view, remember that local laws at the customer site may be different, for example, in terms of warranty, right of return if not satisfied and local content. The further east you go, the less reliance there is on formal contracts, and there is more trust. A 120 page Western contract is, potentially, very insulting in Japan or China.

Time

In terms of time, “follow the sun” can be useful, but you probably don't want to plan for it, better to use it if your schedule needs crashing!

Share the pain in review meeting times, move the times around so that everyone takes a turn to have an inconvenient start time!

An important cultural difference is the time it takes to build trust. It is said that Anglos (Americans, British) will trust their life savings on a cold phone call. Other cultures (high femininity) take much longer to build a trust relationship.

Cost

Again, simple, but remember to add additional cost for travel. Think of a number, and then increase it!

Human Resources

Make sure that the resource management process recognizes that not everybody is comfortable working in multi-cultural teams, pay particular care to offshore resources coming on-site, remember that some people may not have travelled abroad before. I have had to buy a coat for an Indian engineer in Norway (and incidentally, one for an Arizona born, California resident Project Manager who arrived in Detroit in January without more than a thin jacket). Remember too that a number of the Indian engineers will be strictly vegetarian, one of my first questions is whether they are or not, it affects where they eat and whether they would rather self-cater when working abroad. Some locations will have plenty of ethnic foods available, others may not.

Communication

Communication needs a lot of focus. One learning is that team members, or customers, cannot see how hard remote teams are working. So, remote teams may be under extreme pressure to complete their tasks and it may not be readily apparent to other team members. Another is the importance of having an on-site representative when working with an offshore team, this is a critical success factor and really helps communication plus, the local representative can provide cross-cultural coaching to aid the rest of the team. The diagram below illustrates how this is implemented for Hewlett Packard on-site offshore projects, it may, of course be different in other companies

img

There are a number of technologies that can be used to bridge the global divide and keep in touch:, Conference Calls, shared Web sites particularly technologies that allow project teams to share information between companies. This is another large subject, but these technologies can be vital in supporting the “virtual team”. A sample of technologies and there application in time and space is shown below;

Space-Time Dimensions of Communications Technologies (V)

img

Misunderstandings will occur, - through language, conceptual misperceptions or differences in terminology. It is worth considering adopting the Air traffic control “read-back” system: This is what I've said, now you read back to me your understanding. The Project Manager needs to allow for this in timescale, and always follow-up with written minutes !

In general, more and more frequent communication is needed. The time to write things down will be paid back several fold in better understanding. It gives the opportunity for people for whom English is a second language to read and re-read the statements and issues to ensure they have a good understanding. It is much easier to formulate questions – especially at a later time – about written material than about verbal discussions.

Risk Management

One issue from a Risk Management point of view is the fact that we live in a volatile world. There can be tension in any area of the world and travel may be restricted or banned. A Risk Mitigation plan is required for this.

As mentioned under HR, obtaining visas may be an issue.

Procurement

Remember procurement issues in multi national locations. . You may not be able to, easily, purchase project equipment in one place and ship to where it is needed.

Conclusions

Look forward to it, working in multi-cultural, multi-national teams can be very rewarding, however, there are a number of factors that need to be taken into account in the planning. In my opinion, the following are the most important.

  • Have a kick-off meeting with as many people as possible from the team in the same place.
  • Continue to spend time with your team, in person if possible, discuss the cultural and behavioural differences, try to build on the positives and reduce the impact of the negatives.
  • Remember culture is two way, look at your own behaviours as well as others!
  • If you are working with an offshore team, retain someone from that team on-site to facilitate communication with the offshore team.
  • Practise your communication techniques such as asking for frequent feedback and confirmation of attendance and salient points!.. I remember giving a long report over the telephone, only to find that, half way through it everyone left to get a coffee, I continued talking to an empty room!
  • There are different values to time in different regions. Asking an American engineer the biggest difference working in Ireland he said .. Everything shuts at 6pm, Americans have a “to-do” list they expect to keep working on, virtually 24 hours, the Irish perhaps have a more balanced view, and things take longer!
  • Include some of the lessons learnt above in your project planning; hopefully it will save you some grief later on!

I'll end with a quote from the Trompenaars (1998) book –

“Other cultures are strange, ambiguous, even shocking to us. It is unavoidable that we will make mistakes in dealing with them and feel muddled and confused. The real issue is how quickly we are prepared to learn from mistakes and how bravely we struggle to understand a game in which “perfect scores” are an illusion and where reconciliation comes only after a difficult passage through alien territory.

We need a certain amount of humility and a sense of humour to discover cultures other than our own; a readiness to enter a room in the dark and stumble over unfamiliar furniture until the pain in our shins reminds us where things are. World culture is a myriad of different ways of creating the integrity without which life and business cannot be conducted. There are no universal answers but there are universal questions and dilemmas and that is where we all need to start”.

I would be very happy to receive any comments, thoughts or other experiences; I am contactable by e-mail on Iain.Wilson@hp.com

Further Reading

Hofstede, G (1991) Cultures and Organizations: Software of the Mind, London: McGraw-Hill

Trompenaars, Alfons (1998) Riding the Waves of Culture: understanding diversity in global business New York: McGraw-Hill

Morrison, Terri (1994) Kiss, Bow or Shake Hands : how to do business in sixty countries Avon Hills Ma.:Adams Media Corporation

Acknowledgements

I acknowledge the help and advise of my colleagues within HP; Patrick Pichon, Alan Stimson, Edward Ogroske, Fred Nilsen, Jonathan Collins, Murali Vepanjeri-Madabushi, Ken Watt and Joe McCarthy who all provided input or critiques to this paper.

References

Henry, J (2001) Creativity and Perception in Management, from B822 Creativity, Innovation and Change, London:The Open University Business School Sage Publications

Hofstede, G (1984) Culture's Consequences: International Differences in Works-Related Values Beverly Hills CA: Sage Publications

Hofstede, G (1991) Cultures and Organizations: Software of the Mind, London McGraw-Hill

Trompenaars, Alfons (1998) Riding the Waves of Culture : understanding diversity in global business New York McGraw-Hill

B823 Course Team (2001) Unit 2 Communication P 50 Milton Keynes, Open University Business School.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

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