The Importance of Bridging the Cultural and Communication Gap

Derek: Hi, and welcome to the first episode of the Outsource Accelerator Podcast. My name is Derek Gallimore and today we are joined by David Prichard.

David Prichard is an Austrial-Asian and he has been in the Philippines for just over three years now.  We dip a little bit into his story in this podcast, and David heads the operation here for an online retailer called ‘The Nile’.

If you want to find any more information about David himself or ‘The Nile’, then go to our show notes that is available at outsourceaccelerator.com/podcast/episode1.

Today we talk to David about all things operational. David is a wealth of information, he has a great analytical brain and I really appreciate his insights into his management style. And this really great value here in this podcast in joining David’s journey as they setup an office over here and then realized what they needed to do as a company, to mature as a company overall, to get the best out of the Philippines staff but also the best out of the company going forward.

So, it’s a really interesting story and it’s a very common story and a very common experience for people starting their outsourcing journey. So, I think this is a fantastic first episode, it gives you a lot of insight.

Again, if you want any show notes, if you want the transcripts, if you want any contact details, go to our show notes which is at outsourceaccelerator.com/podcast/episode1

Enjoy.

Derek: Today, I am with David Prichard of ‘The Nile’. Hi David.

David: Hi Derek.

Derek: And we are gonna discuss… David has been in the country now for over three years, I believe; is that right?

Derek: That’s correct, a little bit over 3 years. It’s January 2014 when I arrived.

Derek: Fantastic. And in that time, you have actually met a fantastic Filipina and you have now got married and you have just started a family. So, congratulations for that.

David: Thank you very much.

Derek: And significantly, though you have been working in a very hands-on operational capacity in ‘The Nile’ and you could maybe explain a little bit more about that but I wanted to talk to you today about what you have learned over the last three years. You were pretty much sort of put in the deep end from what I understand and it’s… I was talking about this previously and I think this is some fantastic learnings that you’ve made there.

David: Yeah. And being put into the deep end is probably a good way of describing it but it wasn’t already planned that way. I follow a very typical path of people that end up here in the Philippines. I arrived, like I said on January 2014, when we first decided that we were going to setup an operation here. Then, the intention was that I would stay for approximately, if I recall correctly, maybe two weeks, that was what my original return ticket was booked for.

I have been with the company for many years prior to that in various areas, so, I knew it all very well. But there was never initially an intention for me to come and be the guy on the ground here in the Philippines.

Basically, we started with a small number of staffs. We did have a customer service manager from New Zealand that was going over at the time. The intention was that he would run things. Although he’s only been with the company for about a year at that time.

And really, I was just there to make sure things got off the ground, there were no complete belly ups actually or anything like that. Just to go back to Sydney and make sure that everything is as we expected, just to get in a little bit of insight.

Derek: You are given a just go for two weeks and see what you think about here?

David: Yeah, that was basically it.

Derek: And that’s three years ago here, that’s incredible.

David: It is indeed. I don’t know where all the time has gone, but basically it became pretty apparent from the beginning that I could add a lot of value, I could do most of the functions that I have been doing previously at the Sydney head office. But I could just add value by being on the ground, just adding a helping hand, kind of, observing, being the person that the management would really trust to deliver the raw truth when necessary.

Derek: So, just a recap, how many staff did you have at manila at the time

David: On day one we had three local staff and then like I said we had the customer service manager from New Zealand who basically was gonna be running things. We always intended to expand beyond that but that’s what we started with.

Derek: And then in your fresh new eyes, what were two of the takeaways that you learned from your first day office like what really surprised you?

David: Let me say a little story, actually, and it was a kind of lesson that at hindsight, it was extremely valuable about how you can sort of become very misaligned between two different opposites in different countries about what’s going on, what expectations are and how it’s very important to deliver. I guess some of the basics of the company and company culture from day one is that things that you assume everyone knows because you know it, new people entering the organization don’t necessarily know.

To illustrate that, we actually had a bit of a delay, we were supposed to be launching I think, and at some point in December 2013 but for various operational reasons, we had to push that back. But we had already hired our original three staff, and so, we had them on the payroll already, and so, we said to the facilities. So, we were working with our facilities man and a BPO provider in the Philippines at the time.

And we said to them look, obviously, we will start paying these people now but we are not ready to start using them, so could you please educate them on our company, basically, have them looking at our website and learning as much as they can about, The Nile, which is our business.

Unfortunately, part of that message got lost and we were told day after day that, yes, our staff are very eager to learning everything they can about the company. And that it turned out when we arrived that they have been looking at completely the wrong website, a small corporate website.

It was actually a corporate website we had under a different company name which really did covered nothing about ‘The Nile’ which is our own online retail operation. So, literally it was like a website with about four different pages on it, just really high level, kind of, corporate marketing stuff and they spent literally two weeks looking at that website.

And when we arrived, they had basically no insight whatsoever about ‘The Nile’ that was news to them that we were an online retailer. And I guess the lesson there is…

Derek:  Yeah, the lesson there is you really need to set your tasks very clearly and then check that they are understood and progressing with them.

David: Set them clearly and then take a step back and then make sure that it’s understood, this is a very important cultural lesson, just sort of, like us jumping ahead to what you really want to cover in this interview, about dealing with Filipino.

It’s often been said that Filipino would always answer yes to a ‘’yes or no ’’ question. I don’t mean that in any way that might seem degrading to Filipinos but it is a sort of a cultural aspect, with that generally, we kind of nod along , it’s just something about the way things operate in this country.

And so, you kind of assume if you are in the context of say in Australia, that if someone isn’t necessarily following, they would let you know, they would say wait a second, there is a gap here about knowledge. What you are asking me doesn’t quite make sense, so I need some more help here; I need some more context and background.

Filipinos, especially, in the BPOs industry depending on what level of skill you’re dealing with, the less likely they give you that feedback. So, in an example like the one I gave you, they will just sit there and spend two weeks looking at a corporate website with four pages on it without coming back to you necessarily and say, hey! Wait a second, are you sure you want us to look at this website for two weeks?

And so, I guess in terms of productivity hack, the key thing is to always get the person you are talking to or the group you are talking to, to repeat back to you and actually demonstrate to you that they understand the instructions you’ve given and they understand the whole context.

So literally, say, this is what I need you to do; do you understand? Yes, correct. Okay, explain it back to me, and then it forces them to think about it more than they may have otherwise and then it’s very clear if there are gaps or the things that you need to cover more. Maybe that’s not limited to a Filipino cultural context that may apply anywhere but it’s certainly something that we learnt in those early months.

Derek:  It’s actually one of our functions but I am trying to promote is effectively training the trainer because there is a lot of little things you need to know when you start in a BPO, or when you start with outsource staffing, or even if you are just sort of setting more tasks than you previously would have normally, it’s all part of a business expansion, in a respect; isn’t it?

You were saying also, so, that’s in terms of a specific task but then, if you expand that out, and your team then started managing processes within your company; how did you find they adopted and managed the processes as compared to your native team in Australia and New Zealand?

David: Yeah. That was a very interesting lesson for us as well and by way of a bit of background, we came into Manila being a relatively mature company. I think of that quite over ten years of history. But we did not have what I would describe as mature and comprehensive process documentation.

In some ways, even after ten years we were still a start up in terms of mentality, and being in the online space, and online retail in the early years, the editing we generally took, you know, we shouldn’t need to invest a huge amount on comprehensive process documentation because everything should be online, everything that our customers need in terms of placing an order or getting the information they need should be automated. So, it’s a job for software developers and we kind of said right we do need some people to do customers support but we never really had that front and foremost in our minds.

Derek: It’s very common; isn’t it? And as in keeping with being young and agile and nimble, there is definitely upsides to it isn’t it but then you find it didn’t quite work here.

David: Exactly, we found it wasn’t working for us back in Australia because we needing to expand and take on more staff and you just can’t rely on the domain knowledge that some of your key people have, you need to make things a little bit clearer. And basically layout the decision making logic and flow charts, and have screen grabs that demonstrate each grid a person needs to go through.

Otherwise, it’s simply isn’t scalable, you can’t train people enough and you can’t have consistency in your product unless you have that. It seems a little but obvious but the importance of it became very apparent to us in those early months. So, we said wait a second, we need to actually sit about documenting this stuff and the first attempt we made was using a third party that specialized in this.

Now, that you had the right process documentation and we sat down with him and said right, this is everything, our customer service team for example does, right, so they get a certain kind of query. The most common query that our inbound customer support team receives from customers is basically where is my order, where is my stuff? Where is the stuff I have ordered? When is it gonna arrive.

Generally, there is about 50,000 different ways of expressing that one thing, which we had to train our staff to realize but basically it always boils down to the same thing. And so, in order to answer that question that they need to follow some decision-making logic, they need to check the status of the order, has it been dispatched to the customer or hasn’t it, and then from next step you go to which additional step beyond that to get the answer they need and usually the template they need to send.

Derek: So, hired an expert, there was an expert that’s mapping it but they obviously had very little knowledge of your company; is that what you found them? So, they were good mappers but they didn’t know your company.

David: No, they didn’t and that’s the real problem you encounter. It’s very hard to transfer when a lot of domain knowledge exists in someone’s head. A lot of people is in my head in this case, and like my colleagues in Sydney.

And so, they sit about doing it but we ended up with documentation that wasn’t really that useable and demonstrated as you entered there, a lack of real understanding of the fundamentals. It gets very easy to get fixated on each visual step, like literally, you know, the start of this process you need to log in, so they would take a screenshot of the log in screen and that would be step number One, and then it would become really-really granular, and then you are reading this and you can’t actually understand the fundamentals of the process.

It’s literally so detailed without actually focusing on what really matters. What are the key decisions that need to be made?  What’s the purpose of this task? And that the really important thing you learn is it’s very easy for employees to forget or not actually appreciate that overall purpose of what they are doing and to get too fixated on the individual steps, and that can lead to some very negative consequences.

So, the initial attempt using a team that we brought in from the outside did not succeed, we literally looked at it and said this documentation is not useable and the amount of time and effort it would make to get these guys to get into a state that we require didn’t really justify or made sense, we might as well do it ourselves, basically. So, that was one of the early support roles that we had envisaged that we had to hire which is a process specialist.

Derek: Can I ask, it tells that you have gone through a process because it’s sometimes difficult to unpick whether these experiences that people go through in the outsourcing world is something unique to outsourcing or could it also be a maturation process of your company and inevitably as the company grew would have needed to go through this and these are the sort of the growing pains of a successfully growing company; how much…

David: I suspect, Derek, that little of this is completely unique to a BPO outsourcing context. A lot of it is probably like you said fundamentals that any company goes through, but the certain things are highlighted and certain things come to the fore when you are on a BPO context. For example, you do need to document, the same thing would probably occur if you are doing things onshore within an organization in Australia or wherever you are. But you have for example, the additional cultural context.

You need to take processes that were developed to the extent that they are mapped out or if they are in some people’s heads, in an Australian context by Australians and then you need to translate that into something which is gonna be understandable by Filipinos. So, it adds an additional context because they are looking at things from a different perspective and then read things differently. So, it’s not, in and of itself, that is not a solely BPO specific problem but it’s one that I think it’s gets heightened in the BPO context.

Derek:  Interesting. And then, one significant aspect of processes then is the measurement of them; the measurement of success, the measurement of compliance and then link to that are the KPIs which are very commonly used in the Philippines and the BPOs settings, KPIs standing for Key Performance Indicators. How did you go with those? They are double edged swords as well, I think.

David: Absolutely. And that’s one of those, when you arrive in the Philippines you learn a lot of acronyms KPIs is not unique to the Philippines, of course, but I sometimes encounter people from outside the Philippines that use that acronym and I forget that not everyone knows what they mean. They are totally fundamental to the way things are organized in the BPO industry here.

Basically, you need metrics to record performance and you need metrics to direct people towards the outcomes that you want. The most basic ones that you’d find in a call center environment if you are dealing with inbound calls, BPO is by no means limited to that.

But if you are dealing with, for example, customer support, you have what they call AHT which is Average Handling Time, you have first call resolution and things like that, which basically measures the output of what your employees are doing combined with the quality control to actually see the quality of it.

And so, just like documentation we didn’t have any of this really in place either, we had a very rudimentary quality control and KPIs, but we realize that is also something else in order to be scalable that we would need to build up. So, we had to figure out ways of measuring the tasks that our employees are doing and then actually implement that, so, that it’s clear to everyone in the organization, and we are all kind of on the same page as to what people are supposed to be doing.

Derek: The ultimate dream is, I think in every business owner’s head or management’s head, it’s to have a concise clear dashboard, isn’t it, and on this dashboard it’s got a lot of, kind of, worrying indicators, showing performance, showing the key metrics and the ability to drill down. And, it’s a very common ideal across all commercial enterprise across the world but I think more so, it’s far more prevalent and kind of leaned on in the Philippines; isn’t it? And, were you able to measure what you wanted to measure?

David: I will be frank with you Derek, that’s kind of an ongoing struggle, it depends on the different functions because we have a number of different functions in our operation center now.

With customer service, we basically got that right, we embedded a fiber key metric, and we have those in place and every employee receives a score card every month and they get more real-time information as well and that basically tells them how they are doing, and that rolls up to the middle management as well, so, they ultimately get scored on the performance of their subordinates and so that’s kind of in place.

But in terms of the pitfalls, not all processes are that easy to document, for example, we have a team that does procurement and order fulfillment which is basically around exception handling with problems that occur with our customers’ orders and that is kind of a role that has about twenty to thirty different tasks that they perform on a regular basis. And each of those tasks are slightly different.

One task for example is checking all orders that are overdue, that haven’t been dispatched to customers in the time we expect, investigating and then finding out what’s wrong and then resolving the problem. A bit of the same time, they have other specific tasks like certain technical errors that occur with orders, they have to through a list of those and correct those certain orders that are provided by the original supplier, they have to find a different supplier…

Every one of these tasks is slightly different and the way things were found typically in the BPO organizations, especially, the large ones, is that generally, every employee or every team works on just one thing. So, you will find out for example that there is a team, let’s say I am talking about a large BPO provider, like say Convergys or Teleperformance, and then working for a large client, like let’s say, maybe Telstra for example, the Australian Telco.

They will have entire teams dedicated to lead generation, which means,  generating leads for sales, and all those people would do all day is basically the same task, they would call, they have a list of people to call, they will call them up and the job is to try and generate the lead for another sales farther down the track. And so basically…

Derek:  That was the origin of outsourcing; wasn’t it? That was huge companies where they had so many different processes and they could really, with precision and accuracy, carve out a process out of there, you know, huge conglomerate, they would carve out one tiny little process and they could have an office of one hundred people just repeating that process.

David: Exactly.

Derek: And it’s an interesting… I think it’s great that outsourcing has become more democratized and more available to smaller startups and entrepreneurs, and smaller companies. But I think there is the added complication that because you can’t so easily carve out processes within a smaller company, you are having to have a lot more of set of integrated processes aren’t you?

David: Exactly. And when you are trying to hire people at the management level or agent level within the BPO industry, you will find that most people are not accustomed to a smaller operation where people had to do more than one thing. They used to literally, as you described there, a huge organization and you can have a whole team just doing one process, and that’s all they do.

That’s relatively easy to measure from a KPI performance, it’s relatively easy to put, when I say easy, I am not saying it’s a walk on the park, it obviously has its challenges, but relatively speaking, it’s easy to focus that on certain key performance indicators and certain metrics. But when you are at a smaller scale, you literally need teams, like I said, that may have twenty different tasks that they do, and that becomes much harder, and when you go to the average person in the industry including people that are used to generating and writing KPIs, they find that a challenge. It is much harder for them.

Derek:  Exactly, and as you are, I mean a startup mode here, this is a big city, this is a massive country and there is a fertile startup environment, as there is now in most cities. And within that, there are the whole, kind of, startup teams, co-founders and it encouraged me to think that that would produce a lot more generalists or people that have the mentality of when you are starting a startup, you have gotta get in there, roll your sleeves up and do a little bit of everything. And it’s definitely happening, there is more of an appreciation for a generalist approach to things but I don’t think it has quite sort of infiltrated the broader market.

David: No, it’s sort of on the customer and interestingly on that point, tapping into, I guess different labor pools and different networks is quite a part of what my mission is to come as my company’s representative here in the Philippines. You know, I go along to start up advancing meetups and things like that.

And that’s again part of the value that helping someone onshore can actually do, is that you can look beyond may be the most traditional sources of staff and actually see if you can tap into a different pool, a different skill set, a different mindset and see if that can help your organizations as well.

But I guess, it’s a bit of, it’s kind of an infancy for us like a technical mission but it’s one of the things that’s on my agenda to try and get more start-ups to help people and also, different things like software developers and pools like that, you need to look a little bit farther afield than the traditional recruitment methods.

Derek: Dig deeper, that’s great. Some amazing points here and some great learnings from your three years in Manila, David, and I wish you all the best.

David: Thank you very much Derek.

Derek: Okay. I hope you enjoyed that chat with David. If you wanna get in touch with David, if you want to know more, if you want transcripts for (the) show. If you wanna get in touch with ‘The Nile’, please go to our show notes and you can find that at outsourceaccelerator.com/podcast/episode1.

See you next time.