How organisational culture impacts talent acquisition
Organisational Culture: Implications for Talent Acquisition Onshore & Offshore
The word culture has been thrown around a lot.
It has led the rebrand of the HR Business Partner as People and Culture Consultants, where culture refers to organisation culture.
Some people think about culture in terms of ethnicity or religion and some people think about it as a nations culture, e.g. Australian cultural norms and beliefs.
These are all correct – our problem is using it appropriately given the business or social context.
Gardenswartz, Rowe, Digh and Bennetts (2003) Three Model clears this up, explaining that there is National Culture, Personal Culture and Corporate/Organisational Culture and they all overlap shaping each other, each holding values, beliefs, identities, needs, wants and desires.
These three cultures and their relationship are well demonstrated in talent acquisition processes.
Organisations use their culture and often the national culture as selection criteria.
Individuals are assessed on whether their personal and national cultures fit with the organisation?
Unsuccessful hires either do not perform or are the wrong fit.
Cultural Fit in Outsourcing, Offshoring and M&A
This fit factor or wrong fit gets amplified when it comes to outsourcing an organisations processes onshore (Two Organisation Cultures).
Here companies are typically looking for efficiencies and some cost benefit (with cost being not the main driver), Grant Thornton, 2014.
To deliver on this efficiency measure, outsource companies really need to embed themselves in the clients organisation culture to get the recruitment and selection right.
Outsourcers are under pressure, as they dont have the fall guy of different national cultures to account for failures.
They are Australian centres or back offices and they should be able to get the fit right right?
Of course, this gets even more complex with offshoring (Two to Three national cultures e.g. Australia-India-Manila and Two to Three Organisational Cultures, the client and vendor partners).
A real web of cultures that can pose a challenge to finding the perfect fit in talent acquisition, especially as often the control of the recruitment and selection process is relinquished to the BPO.
An Accenture report, Achieving High Performance in a BPO (2012) points to a lack of a collaborative organisation cultures and governance as a contributor to poor performance.
Different national cultures are also a key contributor, as revealed in a MindTribes White Paper (download here) interviewing 13 executives in BPO who cited cross-cultural differences as a key factor in lowered performance.
While the lower labour arbitrage attracts Australian companies to partner with Asian developing countries, Eastern and Western cultures are vastly different. Selecting the right Indian or Manila agent to talk with an Australian customer can be tricky.
Mergers & Acquisitions
Thinking about cultures (national and organisational) coming together, I turned to merger and acquisition research to draw some learning applications for outsourcing or offshoring.
I did not have to look long before I read dismal statistics like in the Harvard Business Review Collated Report (2015): 70-90% of mergers and acquisitions fail globally due to poor cultural alignment and leadership two different organisation cultures involved and often quite strongly opposed personal cultures of leaders.
On paper, before the transition, the deal is commercially very attractive but sadly according to Harvard, 70-90% of this value is never realised.
So, the question still remains: During outsourcing or offshoring, how do we get the fit of talent right when the organisations culture sits with the client?
How do we avoid the failure experienced during M&A activity due to poor cultural alignment?
Solutions: Getting Better Cultural Fit
Outsourcing and Offshoring: Improving Two Organisation Culture Fits
1. In the selection of a vendor partner, clients really need to assess cultural fit.
Does this offshore or onshore vendor partner share at least some or most of the values and beliefs and systems, e.g. how is poor performance dealt with, how is customer experience viewed, how do they incorporate new technologies or a digital strategy to the way they do business, how does the company treat and develop diversity groups, do they have a flexible work policy?
2. Talent acquisition really makes or breaks a culture.
Onshore and offshore vendor partners need to immerse themselves in their clients organisation cultures to attract, on-board and retain staff who ultimately serve the clients need.
- Really good job descriptions might contain some of the organisations culture (in detailing the work environment, the team, future plans and current tasks) and the personal culture attributes (integrity, critical thinking etc.)
- Request any other documentation or branding online or offline pieces. What is the brand profile in the market and what is it internally with staff. If a clients engagement score is high, asking for employees top 3 reasons for being highly engaged is an indicator of organisation culture.
- Seeing the work enacted at the clients work site is crucial. I often cringe when I hear that offshore partners have never been to the clients workplace or met the people actually doing the work onshore.
- If it is not possible to do this, listen to recorded calls, skype or phone interview key stakeholders and start to document a profile of the organisation culture.
3. Tailor recruitment and selection activities to the clients organisations culture.
Often onshore and offshore vendor organisations do the research or have the information on the organisations culture but then do nothing with it. Often there are barriers impacting consistency in their processes across all clients tailoring definitely makes it harder to manage.
Where possible and within cost and consistency considerations, tailor, tailor, tailor. Your client will love it and you will hopefully see long run impacts to retention. Use the organisation culture to:
- Write the advertisement and be strategic about where to place this ad.
- Adjust screening questions and then selection methods, tailor design work sample tests.
- Include questions in reference checks that pertain to previous work of candidates what is the organisational cultural adjustment? If a candidate worked in a highly competitive banking environment with corporate customers, how will they perform in a retail energy consumer environment? Their personal culture needs to be strong to account for the difference.
Offshoring: Improving on National Culture Fits
The Accenture study (referenced earlier) refers to creating a collaborative culture, this really means that in an offshoring context both the client and the vendor partner need to come together to reduce the cultural distance between them.
The Cultural Intelligence Centre refers to 4 key capabilities to building cultural competence.
This is an area in a BPO environment that gets little attention and governance. These four capabilities are:
Drive: Both parties need to be motivated to learn how for e.g. business cultures work in the East and the West. They need to be curious.
Knowledge: They then need to acquire the right knowledge about Eastern and Western culture. E.g. not adhering and respecting the complex web of hierarchies in India will not go down well.
Strategy: Each culture needs to have a plan of how to do business with each other, accounting for the cultural differences
Action: The cross cultural knowledge and having a plan means nothing if both parties cannot enact this, e.g. all to often I witness first hand leaders who have been trained but still deliver constructive feedback poorly to Asian partners.
Interestingly enough, an observation is that connecting organisation cultures reduces the cross-cultural differences markedly.
So whether it is onshore or offshore, the labels dont really matter if there is One Team, One Purpose – united in the accountability of delivering a seamless service and experience to Customers.
It starts with outsource, offshore and onshore partners connecting their organisation cultures and then recruiting, selecting, developing and retaining talent that fits.
Recommended reading: 7 Lessons from facilitating CX Values and Culture Workshops
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