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Case Studies

Extending a US finance function to Mumbai

The goal was to reduce processing costs within a year by outsourcing 50% reduction application processes to Mumbai while building a platform to efficiently handle the processes. The results were even better than expected.

The Client:
Fortune 100 manufacturing and financial services conglomeration with finance functions distributed across the US. Annual budget 400M USD (1999). Client recognized lower labor costs on Indian Subcontinent could reduce processing costs. The total technology infrastructure was highly fragmented with as many as 8 separate platforms and not standardized onto one platform. In addition, market conditions and auditing requests drove the need for timely and accurate reporting to a critical point.

The Challenge:
50% reduction of processing costs within 12 months by migrating all applicable processes to Mumbai concurrently with building a standard platform for efficient processing.

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Introducing Western Organizational Cultural Norms to a Developing Country Organization (India)

A US company realized nearly half a million dollars in savings after improving communication between the US staff and their overseas contractors and training the overseas staff in process excellence methods.

The Client:
One of the largest Tax, Accounting and Consultancy firms had developed an off-shore captive operation in Hyderabad, India to recognize the potential labor savings over 3 years ago. Back then, the processes selected to be shipped overseas were ones that had been already “centralized” to a US geographic area with lower labor costs. However, there was a lot of resistance by the US workers to relinquish tasks to the Indian operation.

To force the transition, Senior Management made it an edict, but for all intents and purposes, the processes, tools and resident technologies were not reviewed when they were shipped off to India . The entire program was a “lift and shift” effort. The Indian management team did not object to this strategy.

The Challenge: 
Although moving activities to India originally reduced the labor costs in the first 2 years, operational error rates went through the roof, and more US management staff had to be hired to “manage” the Off-shore staff.  In addition, there was a continuous “us” versus “them” reference by the US staff. Caught between decreasing productivity in the US, and continuous process defects leaking into client interactions,  Senior Management promising to increase the Indian staff from 1,000 to 5,000 FTE over the next 2 years. However, with the attrition rate in Hyderabad at +75% per annum, something had to be done to improve the situation. The business case for the initiative was in jeopardy.

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Introducing Western Organizational Cultural Norms to a Developing Country Organization (China)

The Bank of China needed to implement Western human resources policies in order to remain competitive. The Bank was able to implement changes in areas not subject to government policies—and HR is engaging its new role as business partner rather than administrator.

The Client:
Bank of China (BOC), one of three of the largest government Banks in China with over 200,000 employees, located throughout all the China providences as well as Branch offices in the U.S., Europe and other countries in Asia. With China becoming a member of the World Trade Organization, and faced with increased competition from western financial institutions, the Executive Management Team recognized the need to increase their understanding of how western organizations operated with a specific focus on managing their human capital.

The Challenge:
The culture of the BOC was very traditional, with a majority of the management team at all levels coming from the military which forced a very hierarchical, bureaucratic, non-confrontational environment among the employees (i.e., following orders, loyalty, and respect were the core values of the culture).

In addition, employee recognition, reward and benefits were all tied to tenure and government policies (e.g., life employment), not to performance, and therefore there was little to no motivation to meeting or exceeding performance goals by individuals, which was becoming increasingly frustrating to newly hired, young employees whose opportunities now also existed with foreign financial organizations expanding their operations within China.

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Leading Across Borders and Cultures

After a series of acquisitions, the CEO of a global engineering firm effectively melded new team members, from different geographic locations, into an aligned senior management team.

To expand their global reach, an engineering firm located in the United Kingdom had grown through a series of acquisitions. Melding the acquired companies required the CEO to form a top team that was aligned with the strategic direction of the company as well as move the corporate headquarters to Mumbai.

The top team had three new members: the owners of the acquired companies, who now had to shift their roles, lines of authority, levels of responsibility, and work effectively with their peers.

The CEO wanted to integrate the new team members and create a high performance team as quickly as possible in order to i) collaboratively craft and implement the global strategy, and ii) as a result of the synergies between products, maximize the cross-selling opportunities.

The teams were culturally mixed, with each team member based in a different geographic region, many of whom had had no prior face-to-face contact with each other. The CEO needed to role model and set the tone for an organizational culture of mutual respect for different skill sets, styles of leadership, and ways of approaching work processes. He also needed to foster the teams’ ability to work collaboratively towards joint strategic thinking.

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