Monthly Archives: October 2010

Cultural Intelligence VI: India

This series is edited by Dick Locke, SI’s resident expert on International Trade, author of Global Supply Management — A Guide to International Procurement (which was the definitive guide for almost a decade), and President of the Global Procurement Group which regularly gives seminars on International Trade and working with International Cultures.

As highlighted in last year’s post on Overcoming Cultural Differences in International Trade with India, India, like China, has a long cultural history with roots that go back at least to the Indus Valley civilizations in 3,000 BC. (Recently, archaeologists have discovered abandoned and buried port cities and temples over 6,000 years old, suggesting their culture could be much older.) And while the official languages are Hindi and English, India has 5 languages in the top 20 spread across its 28 states, 6 union territories, and the National Capitol territory of New Delhi. As a result, its society is a bit fractured compared to China (where differences are primarily North/South), with mild to moderate differences in culture and behavior, but there are a number of common threads that, once unwoven, will make your dealings with India easier.

With respect to Locke‘s seven key cultural differences (first outlined as six in his classic text on Global Supply Management), power distance is generally quite high as India is based on the caste system (which you must never bring up) and its values and beliefs are still strongly held (despite the movement by some of the newer consulting organizations to abolish the system within their four walls). While they may attempt to be monochronic in their dealings with the west, they are a polychronic culture that does not work by the clock. Buyers and sellers are roughly equal, and any inequalities will be due to any personal relationships that exist between the parties. They are tolerant of uncertainty and even known to take risks and experiment. Harmony underlies almost all of their religions and every aspect of their daily life, and face must always be given. Despite the caste system, and the fact that tasks are collective exercises, they are very individualistic and highly personable (as privacy is rarely indulged in or sought).

With respect to non-verbal communication, it is moderately indirect, as you should not refuse a request outright, but there is a strong history of bartering, so you are free to debate the pros and cons of any situation, as long as your “no”s are indirect and gentle and you tiptoe around delicate issues (such as caste and familial privacy). Unlike some Asian cultures, they can, and you can, get quite loud, but only if you are passionate about what you are saying.

As with any well established culture, there is a lot of non-verbal communication that occurs, and a number of actions that are taboo. For example, while limited touching is permitted (such as same-sex handshakes, and collegial backslapping between members of the same sex, as long as you never touch someone’s head), you should not stand with your hands on your hips, whistle, wink, or point your feet at a person. Hand gesticulations, which many Indians are prone to use when speaking passionately, should only be used if they speak English and you have a basic understanding of their language. You don’t have to be as reserved in your facial expressions as you would with other Asian cultures, but you need to take your cues from those around you, as the degree of expression permitted is situational. While direct eye-contact may be made, it is seen as intrusive by many, so you will again have to take your cues from those around you. Distance, due to crowding in many cities, is minimal, generally only two to two and a half feet. And it is critically important to always maintain an agreeable attitude, even if you don’t agree (as you can always indicate your disagreement indirectly (by indicating that you’ll consider the request, get back to them later, or try). Of course, if dealing with an Indian in North America who is used to your culture, all this goes out the window as they can be very adaptable and will attempt to tune their behavior into your cultural norms in their attempt to maintain harmony and an agreeable attitude.

Meetings, which often begin VERY late, will often begin with small talk and fail to follow a structure. Like other Asian cultures, they will want to get to know you professionally and personally before they get down to business. Remember that time is an expression of eternity in India. Meals are common, and the etiquette is to politely refuse the first offer of food or drink. You will be asked again and again. Just remember not to thank your hosts after a meal. A thank you is considered a form of payment and is insulting. When negotiating, be humble and polite and prepared for concessions on both sides. It is expected. (Although if you were to observe a meeting between two Indian teams, you might find that whoever has the most passion and screams the loudest wins.)

Finally, learn what Namaste is.

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Webinars This Week from the #1 Supply Chain Resource Site

The Sourcing Innovation Resource Site, always immediately accessible from the link under the “Free Resources” section of the sidebar, continues to add new content on a weekly, and often daily, basis.

The following is a short selection of webinars THIS WEEK that might interest you:

Date & Time Webcast
2010-Oct-20

11:00 GMT-04:00/AST/EDT

Finding the Right CSR

Sponsor: MPI

2010-Oct-20

12:00 GMT-04:00/AST/EDT

Increase your profitability through the Theory of Constraints insights

Sponsor: Jamison & Co.

2010-Oct-20

14:00 GMT-04:00/AST/EDT

TPM: The Secret to Success for FMCG Firms

Sponsor: MEI

2010-Oct-21

16:15 GMT/WET

A Unique Approach for Ensuring Food Safety – Manage Contamination Not Recalls

Sponsor: Hollison Technologies

2010-Oct-21

14:00 GMT-04:00/AST/EDT

Extend Your ERP for Stronger Supplier Collaboration

Sponsor: Ariba

2010-Oct-22

13:00 GMT-04:00/AST/EDT

Theft Prevention in the Supply Chain: How Foresight & Process Can Secure the Bottom Line

Sponsor: CargoNet

They are all readily searchable from the comprehensive Site-Search page.

Analytics II: What is Analysis?

Today’s post is by Eric Strovink of BIQ.

Ask a statistician or an applied mathematician, and she’ll probably tell you that analysis is either (1) building predictive models based on historical data, or (2) deciding whether past events are statistically significant (i.e., ascertaining whether what actually happened is sufficiently different than what might have happened by random chance).

But most of us aren’t applied mathematicians or statisticians, so we can get into trouble very easily. For example, we typically haven’t got a particular hypothesis to test (which is critical), and that means any patterns we might “find” are immediately suspect. That’s because in any dataset one can always come up with a hypothesis that generates significant results if one looks hard enough. With regard to predictions, we generally aren’t confident about the predictive power of our models, because we are neither facile with advanced predictive modeling techniques, nor do we have access (in general) to a sufficiently large sample of “known outcomes” to which to compare our predictions. Without a massive dataset like that provided by the Netflix Prize competition, there is no hope of refining a solution.

Of course, practical analysis work can be done without any advanced statistical or modeling techniques. Practical analysis boils down to “finding stuff in your data” that you either didn’t know about, or weren’t sufficiently aware of. That’s the basis of what business analysts do every day. Which salespeople are selling, and which aren’t? What products are selling where, and what aren’t? What was their profit margin, and why? What are the costs associated with running the business, and are they reasonable or unreasonable? And so on.What’s required in order to come up with these answers is well understood:

  1. Acquire data from one or more sources.
  2. Transform like data sources into a common format, and link unlike-but-related data sources together with common keys (or computed expressions that result in common keys).
  3. Create a schema for the data sources, obeying the conventions of a [selected] database system.
  4. Load the data sources into the database system.
  5. Issue queries against the database, and, when useful, format the results into reports.

Steps 1 through 4 are accomplished out-of-the-box by every ERP or accounting system, although only for a small subset of the useful data in an organization. Step 5 is also accomplished by ERP or accounting systems, on that same subset of data, but (historically) rather poorly. That’s why there has been such a large market for “Business Intelligence” or “BI” tools that put some necessary functionality back into Step 5.

However, when the data aren’t generated by the system that’s reporting on them, or aren’t resident in one of a handful of ERP systems to which a BI system can attach automatically, then we hit the essential problem with business data analysis. This problem is either ignored or deliberately misunderstood by most IT organizations, and it’s simply this: business analysts, in general, are either unwilling or unable to accomplish the following:

  • Transform data;
  • Create database schemata;
  • Load database tables;
  • Issue SQL queries.

And, even if they can accomplish those steps, exploratory analysis usually can’t be justified by management because the above process takes too long (and therefore costs too much, causing the expected value of the analysis to be negative). Which means, IT departments, that you can buy the business people all the data warehouse tools you want, and it won’t make a whisker’s bit difference with respect to their ability to analyze data. Sure, you could hire a data expert to help them, but that won’t work either (I’ll save that explanation for part III).

Previous: Analytics I: Optimization Comes of Age

Next: Analytics III: The Data Expert and His Warehouse

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Want a More Productive Supply Chain Worker? Take a Page from Tina Turner!

The difference between a productive supply chain worker and an unproductive one is staggering in today’s knowledge economy. As per this recent article in the McKinsey Quarterly on boosting the productivity of knowledge workers, raising the productivity of these workers, who constitute a large and growing share of the workforce in developed economies, represents a major opportunity for companies, as well as for countries with low birthrates that hope to maintain GDP growth. However, those companies that fail to keep up with their competitors will soon be swept aside in the battle for supremacy in the knowledge economy.

But knowledge work involves more diverse and amorphous tasks than do production or clerical positions and is thus hard to automate or streamline. Plus, the real returns are often the result of creativity and ingenuity that spark a new innovation — how do you boost that with a system or process? Typically, you don’t. So how do you increase the productivity of your knowledge workers? Simple, you increase the amount of time they have to spend on creativity, ingenuity, and innovation. And you do that by identifying their time-drains and taking them away.

According to McKinsey Research, knowledge workers spend half their time on interactions. Half their time! If they’re not getting what they need from these interactions, that’s up to half of their time wasted. So what can you do? You identify the productivity barriers — which can be physical, technical, social, cultural, contextual, and/or temporal — and you remove them.

If distance is a problem, you get people together when needed. If the technology isn’t sufficient for the types of global collaboration required by your team, you upgrade it. If the organizational modus operandi isn’t appropriate to the locale, you change it. If your people are having trouble understanding their counterparts across the globe, you give them some cultural training. If marketing can’t understand engineering and vice versa, you upgrade their technical skills. And if there truly isn’t enough time, you admit that fact and adjust the project scope and timelines to be more reasonable.

In other words, Tina Turner was right. If you want to succeed, you have to break through the barrier.

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Go Global or Go Home

No, this isn’t a post about my favourite topic of outsourcing. Or even about international buying or selling. It’s a post about operations, and it’s for the vendors. Really.

Those who do global business follow the sun. That way they can offer 24/7 customer service, and do it during normal business hours. Most people don’t want to work twelve hour shifts or work all night, and most companies don’t want to pay overtime or the higher wages that workers in many markets would want for the privilege.

However, the leaders have realized that if you want to stand out from the crowd, that’s not enough. You also have to support your suppliers 24/7 and be ready to take action as soon as something goes wrong — even if that’s 2 am Friday morning. As a result, many companies have started putting people on the ground in a local time zone near their suppliers. And it’s these local people on the ground who are doing most of the work. And they themselves want to be supported.

As a result, today’s leading customers care a lot more about where your support team is than where your headquarters is, where you account managers are, or whether or not you’re best in class (because many of them only need good-enough solutions most of the time, as long as these solutions are there when they need them). So if you’re planning to expand your operations as a supply management software or services provider, forget the global sales offices. Smart customers don’t care. They care about whether or not you’re there to support them when they need it. And putting someone on the ground there with them goes along way towards negating that worry — as more and more vendors in the space are realizing, and doing. (In fact, I recently talked with one CXO who said “I’m not hiring anyone else local. I’m here, and since most of my customers aren’t, why would I need anyone else here? I can support the few customers I have here by myself. I’m going to hire the people where they are needed.”)

In other words, if you think you’re the next vendor to cross the ocean, or the continental divide and you aren’t planning on establishing a local presence, think again. You’ll just be wasting your time and money. Customers don’t just want differentiating technology anymore (as they have enough of that), they want differentiating service — and if you can’t provide it in this increasingly crowded space, you won’t survive. Sorry to burst your bubble, but that’s just the way it is. Have a nice day.

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