Challenges Managing Global Teams – Analysis And Recommendations

Project Objective

Discuss about the Challenges Managing Global Teams.

In the current business environment, corporations are competing against each other in order to generate a competitive advantage and capture new markets, products and services. It enables companies in sustaining their future development and remains relevant in the industry. With the advancement in technology, companies are able to easily expand their operations overseas in multiple countries which assist them in reducing operating costs and increasing overall profitability. As organisations are becoming more global, the challenges relating to managing global teams are growing as well. In past few decades, many corporations have faced the problem of effectively managing global teams while operating their business in international markets. According to Zander, Mockaitis and Butler (2012), effective managing of a global team is crucial to an organisation’s success because it assists management in managing change in the workplace and ensures that employees are working to achieve common organisational goals. This report will focus on analysing the challenges of managing global teams by examining the example of ‘Teleperformance’ which is an international business process outsourcing company. This report will analyse the examples of various other enterprises as well to understand different challenges faced by them regarding management of global teams and actions taken by them to address these issues. Further, recommendations will be given for multinational companies to address the challenges faced by them while managing global teams.

The objective of this report is to evaluate the challenges faced by international companies while managing global teams. This report will evaluate challenges relating to human resource management, job satisfaction, operations efficiency, cultural and ethical issues, workplace conflicts and other issues. This report will evaluate examples of different multinational companies such as Teleperformance to understand problems faced by them relating to managing global teams. Another objective of this report is to provide recommendations for multinational organisations in order to address the issues faced by them while managing global teams.

The scope of this report includes the study of a wide range of literature to understand the issues faced by international organisations while managing global teams. This report will focus on issues faced by Teleperformance and what actions taken by the firm for managing their teams globally. This report will include examples of different multinational enterprises that face the issues in order to effectively managing their teams overseas.

Organisations that manage global projects have to deal with team members from different cultures due to which they encountered many challenges because each culture has different rules and such unwritten rules are affecting the operations of the business. In the global economy today, the effectiveness of enterprises relies on the acquisition of geographically distributed workforce because it promotes diversity and innovation in the workplace. Binder (2016) provided that the benefit of the international workforce is that companies are able to get a diverse range of employees from different cultures who contribute different skills and knowledge into the business which provides them a competitive advantage. Most companies prefer to outsource or establish their operations overseas due to its multiple advantages. The companies have to pay high salaries to employees in case of in-house operations, whereas, they can reduce their costs substantially by outsourcing their operations. Kite (2012) stated that in countries such as India and China, the difference of costs varies up to 60 percent based on which companies can save a lot of their money. Similarly, they also have to pay less salary to workers, for example, the average salary of workers in the United States is $857 per week or $44,564 per year (Doyle, 2018). On the other hand, the average salary in India is around $18,000 per year (Emolument, 2018). The corporations can also hire talented workers while expanding their operations overseas. Therefore, companies prefer to expand their operations in overseas countries; however, they face many challenges while managing global teams which negatively affect their performance and increase their overall costs.

Project Scope

Teleperformance is a good example; the company is a multinational enterprise which operates in the business process outsourcing industry. The corporations have hired more than 223,240 employees as of 2017, and it has established its operations in more than 74 countries (Teleperformance, 2018a). The headquarters of the enterprise is situated in Paris, France. The firm has reported revenue of 4.2 billion euros (US$5.17 billion) in 2017 and a growth of 14.6 percent in its earning (Business Wire, 2018) (Figure 1). The profitability of the company is growing at a positive rate because it effectively reduces its operations costs by outsourcing its facilities in countries such as India, China, and Indonesia. However, the companies also face many issues while managing its global teams. One of the biggest challenges faced by multination companies is communication problems while managing their international operations. Although the salary packages and other expenses are lower in countries such as India and China, however, they have completely different culture than compared to western countries which create communication barriers for the organisation (DTSI Group, 2016). For example, people have native tongues which make it difficult for both parties to understand each other. Due to a thick accent, it becomes difficult for managers to interact with their employees and provide them direction. As per Louhiala-Salminen and Kankaanranta (2012), the key message which is necessary to communicate between the parties is often lost in translation. Further, poor telephone or internet signal also makes it difficult for the overseas branch to communicate effectively with their main head office.

Another factor which increases communication barriers is cultural diversity. While managing global teams, corporations deal with employees from different background and cultures. Klitmoller and Lauring (2013) argued that each culture has unwritten rules which create barriers to communication in the workplace. For example, in Germany culture people communication directly whereas in Indian culture it is considered as rude to speak directly. Similarly, Americans communicate freely as it is a part of their culture and in China, it can be considered as offensive to talk about personal matters during a business meeting. Daim et al. (2012) provided that effective managing of a team requires the establishment of successful communication channels between top-level management and lower level employees. It assists management in implementing organisational changes policies and effectively run day-to-day business operations. In case of Teleperformance, most of its employees, i.e., 84,225 and 65,324 are from Asia-Pacific and Ibero-LATAM region respectively (Teleperformance, 2018a) (Figure 2). Therefore, the company faced many difficulties while communicating between each of its branches. However, in order to resolve these issues, the company hire an English speaking manager in each department who is in charge of communicating with lower as well as higher divisions. The company operates in business process outsourcing sector, and it required English speaking employees to perform its operations. During recruitment and selection process, the human resource department focuses on hiring English speaking individuals in order to avoid communication barriers (Singh, 2017). These factors assist Teleperformance in creating effective communication channels between headquarters and other branches of the enterprise which reduces communication barriers.

Literature Review

Another challenge faced by organisations while managing a global team is slow decision-making process which is detrimental to their success. Nielsen and Nielsen (2013) stated that in today’s fast pacing business world, innovations and modern technologies are changing businesses each day, and they are required to quickly adapt their operations as per changing market requirements to maintain their competitive advantages. However, if companies are taking considerably longer time to take business decisions, then it can negatively affect their growth because they will not be able to adapt as per changing market requirements. While managing teams globally, companies have to take quick business decisions as per changing market requirements. However, they face difficulties due to lack of effective communication channels and cultural differences. Many times companies are not able to share or collect the information which is necessary for taking business decisions which makes the process longer. Any technical difficulties can cause huge financial loss to the enterprise because the management is not able to take quick business decisions. According to Carmeli, Tishler and Edmondson (2012), implementing any new business policy or decision is also difficult for management because the senior level executives are not able to implement same policy across the organisation and they have to take into consideration various cultural and religious factors. Moreover, collecting information from each branch and then taking a uniform business decision after considering each factor requires a significant amount of time which increases the time taken in the decision-making process. Teleperformance faces the similar issues as well, and it is difficult for the enterprise to take quick business decisions which slow its growth.

Qian, Cio and Takeuchi (2013) argued that while managing teams in other countries, the top level managementt has relatively lower control over branches which makes the process of dispute resolution difficult. Working predominantly through emails makes it difficult for senior managerial personnel to deal with tough issues and convincing everyone to get on the same page. While performing daily operations, it is common that conflict arises between two or more employees or between management and employees. As per Pinjani and Palvia (2013), generally, top-level managers directly deal with employees in order to resolve the dispute, however, while dealing with global teams, it is difficult for management to convince employees to settle on a common ground to resolve the dispute. Just providing directions from email is convincing enough to settle workplace dispute. Cheng et al. (2012) provided that unresolved conflicts create a negative working environment at the workplace where employees mistreat each other due to lack of top-level management presence. Although companies can hire managers at their international branches and they can resolve disputes among employees, however, it did not resolve issues which employees have with the management. In case of Teleperformance, the company has hired qualified managerial staffs that focus on resolving disputes among employees and creating an overall positive working environment. Although the HR department is liable to settle dispute between employees, however, any conflict between employees and management is handled by senior level management department.

Other than major challenges discussed above, there are a number of small issues which are faced by organisations while managing global teams. As per Patel, Pieper and Hair (2012), the difference in time zone makes it difficult for management to find a “middle” zone where that can conduct business meeting and discuss business activities. In case of Teleperformance, if the top level management decided to have a meeting with the senior managers of all its branches then due to time zone difference managers might have to wake up in the middle of the night to join the meeting. These factors make it difficult for the management to effectively manage their team globally. The study of Chen, Liu and Portnoy (2012) provided that the management has to consider different cultural and religious differences while managing a diverse workforce. For example, a large number of employees in Teleperformance are Indians, and they did not prefer to work on ‘Diwali’ which is a Hindu festival and a national holiday. Therefore, the company pays extra salary to employees who work on Diwali. Similarly, it organises For Fun Festival (FFF) for encouraging and celebrating cultural diversity at the workplace (Teleperformance 2018b) (Figure 3). Awareness regarding local customs and events is important for management while managing global teams. These factors increase challenges of management while managing global teams. Teleperformance faces similar challenges, and in order to address them, the company implement a number of strategic business policies.

There are a number of factors which are necessary to be considered by the management while managing global teams. The top level management can implement different strategic policies for effectively managing global teams. Collings (2014) argued that firstly, the management should start small and collect details regarding national holidays, major festivals and difference in time zones. Information regarding culture and religion of the employees should also be collected by the management so that they are able to understand the difference between the cultures. For example, just because employees in China talk in fluent English, it did not mean that their cultural values are same as well. According to Maynard et al. (2012), the manager should collect necessary information regarding the cultural background of employees which would also assist them in avoiding stereotyping at the workplace which is negative for the growth of an enterprise. For reducing communication barriers, managers are required to implement effective communication policies. Firstly the company should ensure that communication channels between management and the global team are always open. Instead of just relying on emails, managers should be available for global teams more often, and they should conduct regular meeting to keep themselves updated with daily activities of the global teams. It creates an effective communication channels between the management and the global teams which also assist them in resolving organisations disputes. For example, SAP is world’s largest inter-enterprise with over 30,000 employees working across 60 nations. The company effectively manage its global team by creating an on-going team building initiative which acts as a consultant between employees and management which result in improving organisational communication (Kollen, 2013).

In order to establish effective communication channels with global teams, the management can use various technological tools. There are a number of tools available for companies to establish effective communication with global teams such as Slack, Google Hangouts, Skype and others (Burdette et al., 2016). These tools provide facilities such as instant message, file sharing, collaborative working on projects, video chatting and others. These devices can improve the overall performance of global teams by removing communication barriers. Other than formal communication channels, the management should also encourage information conversation with global teams which create a positive working environment. Okoro (2012) argued that effective communication also assists in resolving organisations disputes between employees and the management. Further, Teleperformance can provide training to its employees for creating a positive working environment which assists management in effectively managing global teams. For example, General Electric provides training to its managers through which they learn about cultural difference, and they can use such knowledge to manage global teams effectively (Jehanzeb and Bashir, 2013). Training also assists in increasing the control of management over the global teams which allow them to implement change policies and overall performance. Similarly, the management of Teleperformance can implement these policies for creating effective communication channels between the management and global teams which reduces the time taken in decision-making process and resolution of organisational disputes. These factors can improve the efficiency of team management at Teleperformance and create a positive working environment which is crucial for their success.

Conclusion

In conclusion, a large number of organisations are expanding their operations in overseas markets because it reduces their operating costs and increases their customer base. The growing demand for highly skilled and cheap labour is another reason for the increase in the number of multinational companies. However, these companies face different challenges while managing their global teams such as lack of effective communication channels, disjointed conflict resolution, lack of control over operations, slow decision-making process, time zone differences, and cultural and religious factors. These factors increase challenges face by multinational companies while managing global teams and maintain their effectiveness. In order to address these challenges, organisations can implement a number of policies which result in improving the management of global teams. The corporations can improve communication with global teams by conducting regular meetings, using modern communication technologies and keeping themselves updated with daily activities. It also assists companies in implementing organisational change policies and effectively resolving workplace disputes. Providing appropriate training can also assists managers in learning cultural and religious differences and creating a positive workplace environment. These policies can assist Teleperformance in effectively managing their global teams and sustaining their future growth.

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