When companies decide to outsource part of their activities, this will require serious preparation. They invest time and effort in a sourcing strategy, considering what should or should not be outsourced. There is attention to the scope (involving one or more vendors), and a business case will identify at least the financial benefits.
A key success factor is often overlooked. Cultural fit is mostly taken for granted. This is strange since there is a broad consensus in the field that culture is an important aspect of any engagement. But what is culture? And what is the culture of an organization that is outsourcing? Or that of a potential vendor?
What is culture?
Various authors have written great things on this topic. I think The Culture Map by Erin Meyer is second to none in books discussing international cultural differences. From my own experience, I have some (anonymized) examples:
In the collaboration between two departments within a ministry there was an ongoing stream of conflicts and escalations. Quite regularly, I found myself in contact with the management of both departments. One department consistently noted the need to comply with European tender processes and ensure the governance followed a pre-agreed RACI matrix. The other department struggled to accept the continuous delays in achieving tangible results. The focus on process compliance vs. the focus on efficiency made it as if both groups spoke different languages.
Recently, I was involved in a negotiation process and learned about two decision-making extremes. The team on one end of the table had the full mandate to get things done, while the other team had to take every material change back to their senior management. There are ways to work around this during negotiations, but will this work in the years to come? More likely than not, this will result in frustrations for at least one of the parties involved.
My point is not that one culture is superior to another. But it should be clear what the own culture is and which norms, values and rituals in another organization or department are compatible with those. Or not.
Determine your own culture
It is not easy to determine your own culture. Obviously, we are all transparent, client-focused and result-oriented. But are we really? Who are the local heroes and role models within your organization? And what example do they set with their behaviour? As an advisor, I ask these kinds of questions, often leading to memorable conversations. And sometimes to confrontational insights. For example, a tool like Delegation Poker can help clarify the mandate and room to manoeuvre for a negotiation team. In my experience, organisations’ implicit assumptions of their own culture are often far from correct.
A cultural fit is one of the key success factors for any long-term engagement. Insight into your culture and thinking about the desired culture of any collaboration should be top of mind when drafting a sourcing strategy. Not to find partners who are a clone of ourselves. But we must pay attention to possible differences and address this head-on.