Reducing the Costs in Cross Border Teams

Alice Stewart (Aurizon Leader in Applications Operations) and I presented at the IACCM conference today #iaccmaustralasia2018 to a packed room of over 60 professionals. The theme of the conference is Cross Border Collaboration, which is right up MindTribes alley. Alice and I have been working together since August last year to improve Aurizon and their partner's collaboration. Here are some highlights of the questions asked and answered. 

Div: Introduction: When we talk about cross border relationships, e.g. engaging an Indian vendor to supply IT services, we are often talking about working through another organisational culture and offshore staff who have different approaches to work from both a culture and operations perspective. 

We have found across the last 5 years that our clients experience under-performance and increased management hours. One of the main reasons is that many of the Australian leaders we work with are have not been developed to lead cross culturally and virtually. They may have been given general cultural awareness training on Indian or Filipino culture for example, but this is not easily translated into everyday business scenarios, like how to conduct a meeting to reset expectations, how to give constructive feedback, and how to negotiate different SLA’s. 

Equally vendor partner teams and leaders working offshore are still operating from a local culture perspective and their cultural training on Australia or NZ is very generic (mostly geography and lifestyle related rather than behavioural and business focussed). This is despite vendor partners being very experienced working with Australian clients. It usually takes 12-18 months or more for partners to start to deliver on expectations. Our aim is to shorten this timeframe and/or improve the quality of deliverables through better cultural alignment on critical work tasks. 

Question 1

Q 1: To begin, Alice give us a quick overview of your partnership with your vendor supplier. Yours is structured a little differently, as you have both an onshore and offshore/cross border staffing arrangement. Tell us a little more.

A: Yes, we have a very interesting setup in Aurizon. We currently have a multi-vendor support environment with our two key partners each looking after a different section of our IT support portfolio. Both have key resources and delivery managers working onsite with our teams, however the offsite teams for one are based out of New Zealand and the Philippines and other out of India. It is not always clear cut where ownership lies during incidents, as the two areas are not mutually exclusive, and we often find ourselves having to work together to achieve a common outcome. In both arrangements we work mainly with the onsite leaders who pass on the directions and drive the results. As you can guess we have many different cultures, objectives and personalities to work with.

Past experience was what prompted us to reach out to MindTribes when we started the new engagement to help bridge some of the communication difficulties we had experienced previously.

Question 2

Q 2: Alice, we have been working together since August last year. Thinking about the senior leadership team and vendor performance, what has been your biggest realisations?

There have been a couple of key learnings that have stood out to me since we started working together. We have realised that we have not been leading our vendors on the same path as us towards achieving our IT strategy. One reason is that we are currently updating our own working model and are still forming our new technology strategy. We need to understand where we are going ourselves before we can communicate it to others, and the other reason being we are very reactive to day to day issues and are not taking the time with our vendors to stop and look at the bigger picture.

Another learning is that we have not had a clear enough delineation in our transition from the learning and on-boarding phase of the engagement, into autonomous, steady-state support.

This has caused an over-reliance on our internal staff to provide support, and has led to more work from the leadership team into reviewing task details and handling escalations. It is causing frustration in the delivery of services from both IT staff and our customers.

We have realised that the expectations we have internally on how our services should be delivered are understood differently from each company. We are still learning how to align these expectations and how to work together to find a solution.

Div: That is a good summary and is not uncommon with what we find with our other clients. We ran a study with our clients that showed that Australian leaders spend on average .25 to .7 of an FTE per process to get a high-quality result, when working with a cross border team. This was still evident whether it was a new team or a mature cross border team. 

Our root cause analysis showed that during the early days and well into the engagement, Australian leaders were not equipped to lead virtually and cross culturally. Transferring knowledge, communicating expectations, managing performance, managing with lower local capabilities in both staff and leaders were compounded by not having staff in the same office and having them come, often from Eastern business cultures.

Question 3

Q: Alice, can you share any impacts to productivity or efficiency that you think has roots in cultural capabilities of both your leaders and your vendors? Does an onshore representative from the vendor who sits in your office help?

A: A situation that we often find ourselves in with our support partner is one were they agree to all that is being said. I can probably count on one hand the amount of times I have heard the word “No “from them. A lack of understanding of cultural difference led us to this situation. Here in Australia (and New Zealand) we are quite open to asking questions, and offering feedback. Having our service delivery managers on site has both positive and negative implications for this. The team in Aurizon are experienced in Australian culture and can mostly understand what we mean when tasks that are assigned, but the message can become a bit distorted when it is not communicated directly to the teams doing the work.

We all have a good working relationship with our delivery managers, but we do rely on them a lot, and they filter the vast majority of work through themselves, putting them at risk of burning out.

Question 4

Q: Can you share what our initial steps have been to bring about vendor governance and how we are driving operational results?

We have been conscious of ensuring all leaders are working off the same page towards what we are aiming to get out of this partnership. We have made sure to gain sponsorship and active support from our CIO. We have held a series of catch ups with MindTribes acting as facilitator, and also within our own leader groups and with our vendors.

After several open conversations about what our current pain points are, and what our ideal state should be, we have identified three key areas that we need to focus on that we believe, when we get right, will have a positive flow on affect across the board. These areas are capability, productivity and ownership.

We have a full day workshop planned in June that we are preparing for now that aims to set clear expectations of service delivery across these three areas. Together we are going to identify the tasks needing to be done to get the right behaviour in place. Set realistic timeframes and assign owners to those tasks to ensure we can make positive change happen.

Question 5:

Q: So Alice, in closing, what would you say has been your aha moment/s since Aug?. You have never approached a vendor relationship like this before, share your insights with the audience, why does it work?

I didn’t realise how many assumptions my peers and I were making when working with our partners. It is easy to believe that everyone thinks like you do. Without MindTribes getting us to look at things from a different perspective we would still be repeating our mistakes of the past.  It has been an eye-opening and incredibly interesting journey to learn how other cultures work in a corporate environment, and to figure out how to make all of our different viewpoint work well together.   It is definitely a journey, not something that you can get right straight away. The differences in country culture, company culture and personal culture that feed into making the relationship work is very complex, and I am glad you are helping show us the way forward.

Questions from the audience:

Q: Alice, what prompted you to get in touch with MindTribes?

A: (Alice): When we were bringing a second vendor on board, we knew we did not want to make the same mistakes as we did in the past. We knew that we needed more support in managing our partner relationships but were unclear on how to go about doing it, we knew we needed to know more about culture. Div helped us work out how we should go about it.

(Div added): The one thing that was clear, was there were no point training culture without the business context and knowing what Aurizon and partners needed to achieve to deliver on the IT strategy. Now that we have a handle on this, we can target the cultural learning to business operations, so for e.g. how to reduce reviewing and escalations and how to build better capability offshore to meet the IT strategy. 

Q: How often do you think we should have these cultural knowledge workshops?

A: (Div): We prefer not to think of it as workshops or training. Our process is to run an operational and cultural diagnostic, discovering which cultural dimensions need to be worked on to achieve better outcomes. Then we will run a workshop or workshops but also then follow up with 12 months of performance coaching to drive a business result through culture.