Cultural problems with outsourcing

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Cultural problems with outsourcing
Introduction
Outsourcing of business operations to offshore places has significantly increased in the recent past, due to the rising globalization. Many American companies outsource software and office functions to India (George and Gaut). India is considered to be a major outsourcing market in the global platform. It is estimated that this country accounts for 40% of all outsourcing functions in software services in the world (George and Gaut). However, business outsourcing is facing various challenges that stem from legal, cultural and political differences. This paper explains the cultural problems that exist in the America-India outsourcing platform.
One of the resultant effects of cultural differences is language barrier. Indians use English as their second language, as opposed to Americans (Haberberg and Rieple, 624). According to a survey conducted by Net Reflector, Americans do not like executing outsourcing transactions with people who have accent influence (Morphy). As such, many Americans find it difficult to communicate with Indians, especially on phone and real communication. For instance, language barrier between the two countries forced Dell to close customer care stations in India (Morphy). Thus, language differences can be considered to be deterrents of outsourcing between American and Indian companies.
Another cultural problem that affects outsourcing between America and India is disparity in negotiation tactics. Indians prefer establishing deep relationships before agreeing on contractual concessions with other people (Haberberg and Rieple, 624). As such, Americans may face difficulties in outsourcing business functions to India, especially if adequate time for the negotiations is not allocated. In addition, a negative response is a show of disrespect in the Indian culture, as opposed to the American values (Morphy). This can be a problem, especially if projects are time-bound.
Power distance is also a cultural problem that affects outsourcing between American and Indian companies. Power distance entails acceptance of social status on grounds of wealth, power and prestige (George and Gaut). On this measure of power hierarchies, most Indians accept inequalit...