In the early 1990s, offshoring of software work to development centers in low wage countries pertained to large Western companies such as IBM and SAP who systematically attempted to take a hold of wage differences and resources of a global market. With the rise of the new millennium, former development countries such as India and emerging nations in Eastern Europe began to establish themselves as outsourcing vendors in the global market of IT services, drawing from a growing pool of qualified IS resources (Bode & Mertens, 2006; Hirschheim, George, & Wong, 2004). Given this global supply, offshore outsourcing of IT services has become a widely adopted part of many global organizations' sourcing strategies, especially in the labor-intensive domain of application services. Similar to domestic outsourcing, however, offshore outsourcing is associated with the typical market-based frictions. These frictions pertain to the very nature of systems development and maintenance as services that require a lot of communication and cooperation between the client (e.g., users, business managers, as well as systems analysts and architects) and the vendor (e.g., solutions architects, systems designers and programmers). It is therefore of little surprise that studies on domestic outsourcing have shown that effective relationship management that is aimed at reducing frictions is one of the key challenges and success factors of IS outsourcing (Goles, 2001; Grover, Cheon, & Teng, 1996; Kern, 1997; Lee & Kim, 1999).
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Similar content being viewed by others
References
Bartenschlager, J., Giza, H., Heinzl, A. H., Herrmann, N., Heym, M., Horstmann, A.-J., et al. (2005). Marktsituation und handlungsoptionen zum near- und offshoring (pp. 1–43). Process Alliance Institute.
Benbasat, I., Goldstein, D. K., & Mead, M. (1987). The case research strategy in studies of information systems. MIS Quarterly, 11(3), 369–386.
Blau, P. (1964). Exchange and power in social life. New York: Wiley.
Bode, A., & Mertens, P. (2006). Globalization and offshoring of software. Informatik Spektrum, 29(3), 171–173.
Carmel, E., & Agarwal, R. (2001). Tactical approaches for alleviating distance in global software development. IEEE Software, 18, 22–29.
Carmel, E., & Agarwal, R. (2002). The maturation of offshore sourcing of information technology work. MIS Quarterly Executive, 1(2), 65–77.
Carmel, E., & Tija, P. (2005). Offshoring information technology — sourcing and outsourcing to a global workforce. Cambridge: Cambridge University Press.
Dibbern, J., Goles, T., Hirschheim, R., & Jayatilaka, B. (2004). Information systems outsourcing: a survey and analysis of the literature. The DATA BASE for Advances in Information Systems, 35(4), 6–102.
Dibbern, J., Winkler, J., & Heinzl, A. (2008). Explaining variations in client extra costs between software projects offshored to India. MIS Quarterly, 32(2), 333–366.
Doney, P. M., Cannon, J. P., & Mullen, M. R. (1998). Understanding the influence of national culture on the development of trust. Academy of Management Review, 23(3), 601–620.
Earley, P. C. (1993). East meets West meets Mideast: Further explorations of collectivistic and individualistic work groups. Academy of Management Journal, 36(2), 319–348.
Eisenhardt, K. M. (1989). Building theories from case study research. Academy of Management Review, 14(4), 532–550.
Goles, T. (2001). The impact of the client/vendor relationship on outsourcing success. Houston: Department of Decision and Information Sciences, University of Houston.
Gopal, A., Sivaramakrishnan, K., Krishnan, M. S., & Mukhopadhyay, T. (2003). Contracts in offshore software development: An empirical analysis. Management Science, 49(12), 1671–1683.
Grover, V., Cheon, M. J., & Teng, J. T. C. (1994). A descriptive study on the outsourcing of information systems functions. Information & Management, 27(1), 33–44.
Grover, V., Cheon, M. J., & Teng, J. T. C. (1996). The effect of service quality and partnership on the outsourcing of information systems functions. Journal of Management Information Systems, 12(4), 89–116.
Heeks, R., Krishna, S., Nicholson, B., & Sahay, S. (2001). Synching or sinking: Global software outsourcing relationships. IEEE Software, 18, 54–60.
Heinzl, A., & Sinß, M. (1993). Kooperationen zur zwischenbetrieblichen Entwicklung von Anwendungssystemen. Information Management, 2, 60–67.
Hirschheim, R., George, B., & Wong, S. F. (2004). Information technology outsourcing: The move towards offshoring. Indian Journal of Economics and Business, Fall(Special Issue), 103–124.
Hofstede, G. (1980). Culture's consequences: International differences in work-related values. Beverly Hills, CA: Sage.
Hofstede, G. (1983). National culture in four dimensions. International Studies of Management and Organization, 13(2), 46–74.
Hofstede, G. (1993). Cultural constraints in management theories. Academy of Management Executive, 7(1), 81–94.
Kaiser, K. M., & Hawk, S. (2004). Evolution of offshore software development: From outsourcing to cosourcing. MIS Quarterly Executive, 3(2), 69–81.
Kern, T. (1997). The gestalt of an information technology outsourcing relationship: An exploratory analysis (pp. 37–57). Atlanta, GA: International Conference on Information Systems.
Kliem, R. (2004). Managing the risks of offshore IT development projects. Information Systems Management, 21(3), 22–27.
Krishna, S., Sahay, S., & Walsham, G. (2004). Managing cross-cultural issues in global software outsourcing. Communication of the ACM, 47(4), 62–66.
Kubicek, H. (1977). Heuristische Bezugsrahmen und heuristisch angelegte Forschungsdesigns als Elemente einer Konstruktiosstrategie empirischer Forschung. In R. Köhler (Ed.), Empirische und handlungsorientierte Forschungskonzeptionen (pp. 3–36). Stuttgart.
Kumar, K., & Bjorn-Andersen, N. (1990). A cross-cultural comparison of IS designer values. Communication of the ACM, 33(5), 528–538.
Lee, J.-N., & Kim, Y.-G. (1999). Effect of partnership quality on IS outsourcing success: Conceptual framework and empirical validation. Journal of Management Information Systems, 15(4), 29–61.
Lytle, A. L., Brett, J. M., Barsness, Z. I., Tinsley, C. H., & Janssens, M. (1995). A paradigm for confirmatory cross-cultural research in organizational behavior. In B. M. Staw & L. L. Cummings (Eds.), Research in organizational behavior (Vol. 17, pp 167–214). Greenwich, CT: JAI Press.
Miles, M. B., & Huberman, A. M. (1994). Qualitative data analysis: An expanded sourcebook. Thousand Oaks, CA: Sage.
Moczadlo, R. (2002). Chancen und Risiken des Offshore-Development, pp. 1–16.
Nicholson, B., & Sahay, S. (2001). Some political and cultural issues in the globalisation of software development: Case experience from Britain and India, Information and Organization, 11, 25–43.
Ramarapu, N., & Parzinger, M. J. (1997). Issues in Foreign outsourcing. Information Systems Management, 14(2), 27–31.
Rao, M. T. (2004). Key issues for global IT sourcing: Country and individual factors. Information Systems Management, 21(3), 16–21.
Ring, P. S., & Van de Ven, A. H. v.d. (1994). Developmental processes of cooperative interorganizational relationships. Academy of Management Review, 19(1), 90–118.
Roberts, C., & Wasti, S. A. (2002). Organizational individualism and collectivism: Theoretical development and an empirical test of a measure. Journal of Management, 28(4), 544–566.
Rottman, J. W., & Lacity, M. C. (2004). Twenty practices for offshore sourcing. MIS Quarterly Executive, 3(3), 117–130.
Sabherwal, R. (1999). The role of trust in outsourced IS development projects. Communications of the ACM, 42(2), 80–86.
Sabherwal, R., & Choudhury, V. (2006). Governance of remotely outsourced software development: A comparison of client and vendor perspectives. In R. Hirschheim, A. Heinzl, & J. Dibbern, et al. (Eds.), Information systems outsourcing: Enduring themes, new perspectives, and global challenges (pp. 187–222). Berlin: Springer.
Sahay, S., & Walsham, G. (1997). Social structure and managerial agency in India, Organization Studies, 18(3), 415–444.
Saunders, C., Gebelt, M., & Hu, Q. (1997). Achieving success in information systems outsourcing. California Management Review, 39(2), 63–79.
Schaaf, J., & Weber, M. (2005). Offshoring report 2005 ready for take-off. Deutsche Bank Research Economics, 52, 1–23.
Shenkar, O. (2001). Cultural distance revisited: towards a more rigorous conceptualization and measurement of cultural differences. Journal of International Business Studies, 32(3), 519–535.
Sinha, J. B. P., & Sinha, D. (1990). Role of social values in Indian organizations. International Journal of Psychology, 25, 705–714.
Stake, R. E. (2006). Multiple case study analysis. New York: Guilford Press.
Teng, J. T. C., Cheon, M. J., & Grover, V. (1995). Decisions to outsource information systems functions: Testing a strategy-theoretic discrepancy model. Decision Sciences, 26(1), 75–103.
Triandis, H. C. (1982). Dimensions of cultural variations as parameters of organizational theories. International Studies of Management and Organization, 12(4), 139–169.
Tripathi, R. C. (1990). Interplay of values in the functioning of Indian organizations. International Journal of Psychology, 25, 715–734.
Vogel, M. (2005). Einmal Indien und zurück. CIO.
Willcocks, L. P., & Kern, T. (1998). IT outsourcing as strategic partnering: The case of the UK. European Journal of Information Systems, 7(1), 29.
Yin, R. K. (2003). Case study research — Design and method (3rd edn.). Thousand Oaks: Sage.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2009 Springer-Verlag Berlin Heidelberg
About this chapter
Cite this chapter
Winkler, J.K., Dibbern, J., Heinzl, A. (2009). The Impact of Cultural Differences in Offshore Outsourcing: Case Study Results from German–Indian Application Development Projects. In: Hirschheim, R., Heinzl, A., Dibbern, J. (eds) Information Systems Outsourcing. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-88851-2_21
Download citation
DOI: https://doi.org/10.1007/978-3-540-88851-2_21
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-540-88850-5
Online ISBN: 978-3-540-88851-2
eBook Packages: Business and EconomicsBusiness and Management (R0)