Industry Spotlight: Legal Process
Outsourcing
Large
and small American companies have been outsourcing business processes to India
for quite some time, legal processes are the latest addition. The scope of legal process
outsourcing (LPO) work includes: reviewing and drafting legal contracts,
reviewing claims, discovery procedures that complement litigation processes,
and monitoring compliance by clients.
The
nascent LPO industry is expected to grow 30% over the next two years. The Indian LPO industry has increased
to $250 million in March 2009 from $146 million two years ago. The challenging economy has helped
accelerate the LPO industry. As
companies cut budgets, legal expenses are affected. Companies are looking for law firms or LPO providers that
can lower costs without affecting the quality of the legal services.
To cut costs without sacrificing quality, companies are increasingly exploring the Indian LPO market. Even law firms are beginning to offer clients the option to outsource some of their work to India. Companies pay an average of $400 an hour for legal services, in India, that hourly rate can be reduced to less than a third. Since the language of the Indian legal system is English, it gives India an advantage in the global LPO industry.
Top 10 Mistakes Organizations Make When Developing Global Codes of Conduct
With the recent high profile cases of dishonest and corrupt business conduct, it is increasingly important for companies to demonstrate their commitment to ethical dealings.
A Code of Conduct is an indication that a company takes ethical issues seriously. Such a code can provide guidance for existing and new employees on what is expected of them in terms of ethical behavior. Such a code also sends a message to employees, customers, management, the community, and the government that unethical practices will not be tolerated.
A good code also contributes to a company’s reputation and inspires public confidence in the companies brand. But a code of ethics must be more than a piece of paper. It is vital for it to be a true reflection of the company’s culture and practice. Proper drafting often requires careful consultation and preparation, and the involvement of employees at every level.
As outlined by the non-profit International Business Ethics Institute (IBEI), organizations often make strategic and tactical errors when developing their global ethics programs:
1. Lacking consensus on the objectives for globalization.
2. Not integrating international personnel into the development process.
3. Discounting the importance of promoting programs as a competitive advantage.
4. Basing company policies on legal requirements in the domestic market.
5. Not establishing ethics offices or resources in international locations.
6. Appointing headquarters staff or expatriates (i.e., non-international employees) to fill ethics positions.
7. Offering training materials only in English.
8. Using the word “ethics” extensively in program materials.
9. Translating the ethics code into the local language but not clarifying that the translation makes sense.
10. Focusing on the few cultural differences rather than acknowledging the many cultural similarities.
Indian Business Culture
How Multicultural Training Misfired and Caused a New Indian Call Center to Fold in a Year
With Multicultural Training, the “How” is as important as the “What”
As the holidays approach, I’m reminded of the lively Expat holiday parties in Bangalore amid the palm trees and balmy breezes. One year there was a British expat who kept us laughing with his trials and tribulations of setting up a call center to service British customers of a high-end insurance provider.
His stories were a steady stream of misunderstandings between Indian employees at the call center and their British customers, mostly small stuff. But small as the misunderstandings were, the client complaints that followed seemed never-ending. The insurance company ultimately decided that the risk of further damage to customer relations was too high to keep the call center in India. The small stuff did the call center in.
How small can a misunderstanding be to cause a complaint? Well, take the “lost wife.”
"An elderly gentleman called regarding a life insurance policy to report he 'lost his wife',” the expat said. "After my new customer service representative collected his information, and just before hanging up, she sincerely told the gentleman that she hoped he 'finds his wife'."
I know, this doesn’t sound particularly funny on the page. But it resonated with my fellow expats who all have stories, some funny and others cringe-inducing, of people genuinely being polite and coming across just the opposite.
The point though, is that the call center reps were misunderstanding the real meaning of everyday British phrases like “lost my wife,” and customer complaints soaring because of it. “Lost my wife” merely illustrated misunderstandings so frequent and widespread that the center closed about a year after it opened. The call center rep’s work ethic and desire to please couldn’t compensate for improper training to do the job. Most of her coworkers had the same problem.
All of this could have been prevented if the expat hadn’t made a cultural mistake himself—misunderstanding the kind of training Indians needed for providing international call center service.
He thought the insurance company had a great training program. The program anticipated cultural gaps, which included teaching the reps common British phrases and slang. There were even courses in developing British accents. However, while the call center training was good regarding what cultural differences to train for, it was not so good regarding cultural differences in how to train.
This distinction was at the root of the call center’s problems and sometimes it’s hard to identify. Training sessions were consistently well attended and feedback from trainees was overwhelmingly positive. Naturally, the expat assumed the training was just as effective in India as it was in Britain. Not so.
What he learned too late is that Indians are generally adverse to admit they don't understand something. Mistakenly, he assumed the trainees were learning, based on their feedback and how well the courses were attended. Where he slipped up was not checking that they had actually learnt the material. It’s a classic training error.
In India, there is a very high degree of respect for elders and those with experience. Oddly, a consequence of this admirable attitude is difficulty creating training environments where Indian employees feel comfortable conveying that they don't understand the material. To Indians, to admit not understanding implies the trainer didn't do a good job, which in their culture seems disrespectful. Overcoming reluctance to provide honest feedback requires that training be designed to build trust between trainer and trainees. Without it, companies can easily deceive themselves into thinking their training works.
Take it from the expat: when developing a training program in India, plan for cultural issues not only in subject matter, but the learning process itself.
If he’d known that, he might still be enjoying spiced eggnog and Tandoori turkey this holiday season.