Wipro Technologies, based in Bangalore, India, once struggled with the German company's chip and software design outsourcing business until Walter Ortmueller was hired.
The German engineer's appearance, conversation and way of thinking have the same habits as Wipro's future German customers, which makes it easier for his German bosses to eliminate fears than their Indian bosses. After all, they want to produce high-tech products. And the logistics service is handed over to Indians who are separated by half a globe and speak different languages.
Otto Müller said that having locals as intermediaries helps customers build trust in foreign companies. Moreover, Otto's 20 years of industry qualifications now greatly help him find and win customers for Wipro. When Wipro found Outer Müller in March 2003, the company's technology design business had only two customers, and today it has increased to 10, mainly thanks to the company's development center in Germany with local engineers.
Outsourcing has finally opened the door to the European market in a unique way – by hiring a large number of local employees with the same cultural background as the target customers.
Local employees must be hired in Europe, said Sangita Singh, chief marketing officer at Wipro. She explained that because European companies hope that when a business center is no longer a large institution in Europe, the voice they make can be heard by the other party. The cultural and linguistic ties provided by local employees can increase customer satisfaction and help build strong relationships.
For example, Otto Muller knows that German businessmen would rather hear the other person answering "No" and would not see a delay in responding. He said that Germans are not used to bargaining like Indian and American companies. "If they don't like the price you quote, they will say thank you and then call the next supplier."
Although British and American companies have outsourced services to low-cost countries for many years, most of the conservative European managers are still unwilling to be grateful. Many people feel that it is too risky to hand over their business to distant underdeveloped countries. However, with the intensification of competition and increasing internationalization, more and more European companies have begun to slowly hand over some of their business to companies that undertake outsourcing services, trying to see if they can really improve efficiency and save costs.
According to data from Massachusetts-based consulting firm Forrester Research, European outsourcing spending is expected to increase from 82 billion euros in 2002 to 129 billion euros ($156 billion) in 2008, with more than 20% of outsourcing budgets for overseas outsourcing companies. The ratio will rise from 7% in 2004 to 20% in 2008.
Wipro Technologies, based in Bangalore, India, once struggled with the German company's chip and software design outsourcing business until Walter Ortmueller was hired.
The German engineer's appearance, conversation and way of thinking have the same habits as Wipro's future German customers, which makes it easier for his German bosses to eliminate fears than their Indian bosses. After all, they want to produce high-tech products. And the logistics service is handed over to Indians who are separated by half a globe and speak different languages.
Otto Müller said that having locals as intermediaries helps customers build trust in foreign companies. Moreover, Otto's 20 years of industry qualifications now greatly help him find and win customers for Wipro. When Wipro found Outer Müller in March 2003, the company's technology design business had only two customers, and today it has increased to 10, mainly thanks to the company's development center in Germany with local engineers.
Outsourcing has finally opened the door to the European market in a unique way – by hiring a large number of local employees with the same cultural background as the target customers.
Local employees must be hired in Europe, said Sangita Singh, chief marketing officer at Wipro. She explained that because European companies hope that when a business center is no longer a large institution in Europe, the voice they make can be heard by the other party. The cultural and linguistic ties provided by local employees can increase customer satisfaction and help build strong relationships.
For example, Otto Muller knows that German businessmen would rather hear the other person answering "No" and would not see a delay in responding. He said that Germans are not used to bargaining like Indian and American companies. "If they don't like the price you quote, they will say thank you and then call the next supplier."
Although British and American companies have outsourced services to low-cost countries for many years, most of the conservative European managers are still unwilling to be grateful. Many people feel that it is too risky to hand over their business to distant underdeveloped countries. However, with the intensification of competition and increasing internationalization, more and more European companies have begun to slowly hand over some of their business to companies that undertake outsourcing services, trying to see if they can really improve efficiency and save costs.
According to data from Massachusetts-based consulting firm Forrester Research, European outsourcing spending is expected to increase from 82 billion euros in 2002 to 129 billion euros ($156 billion) in 2008, with more than 20% of outsourcing budgets for overseas outsourcing companies. The ratio will rise from 7% in 2004 to 20% in 2008.
But this small difference is not a big problem compared to other factors in the outsourcing business. Wipro's chief marketing officer, Singer, said that when the company began to expand its technology design business in Germany in 2000, it learned a basic rule of thumb: the more complex the outsourcing business, the more important it is to hire local employees.
Singer said that designing a car navigation system or a handheld computer requires more communication than traditional outsourcing work (such as accounting or technical support). When talking about the company's early German experience, she said: "We found language to be an obstacle and we were unable to achieve the desired rate of expansion."
After that, Otto Muller came. This computer professional has 20 years of experience in the electronics and hardware industry and has worked in a local outsourcing company in Kiel, Germany, to design embedded technology products for German customers.
In addition to winning new business, Alter Müller and the seven German engineers he led also helped to dispel the concerns of customers that "the high-tech products designed by Wipro can be exactly the same as we think." "If a friend recommends them to try something new, they are more likely to take the lead," Otto Müller said.
Wipro also has similar development centers in Sweden, the UK, the Netherlands and Finland, each of which emphasizes the use of local talent. The company also has sales offices in eight European countries, and each office's marketing team has about 90% of local employees, Singh said, which is much higher than the 30% of US companies. In the United States, language and cultural differences are relatively unproblematic. She said that salespeople can all be Indians.
There are signs that European acceptance of Indians in business dealings is on the rise. The Swiss company Loyalty Gate Ltd. commissioned Wipro to develop and maintain software for managing its frequent flyer programs. Khushnud Irani, chief information officer of Loyalty Gate, said that the initial contact of a Swiss person in the project helped to establish the relationship. After that, the Loyalty Gate was basically the headquarters of Wipro's Bangalore. Contact.
In addition, outsourcing is still a hot political issue in Europe. A survey conducted by Roland Berger Strategy Consultants, a Munich-based strategic consulting firm, and the UN Conference on Trade and Development, shows that about 30% of companies believe that public dissatisfaction is One of the risks facing overseas outsourcing. Singer also declined to give a list of Wipro's European technology design customers. Today, when the unemployment rate is at an all-time high, trade unions and governments in Europe have publicly condemned the act of sending jobs abroad.
“It’s the majority of society to pay for the transfer of jobs overseas, because many people won’t have other opportunities,†said An Lenouail Marliere, a consultant at the General Confederation of Labor. The French General Union has about 700,000 members, almost all over the industry. “We require the company to consult with employees before making any decision, asking the government not to encourage large companies to outsource, and instead to give financial subsidies to enterprises.â€
Despite this obstacle, many Indian companies say their European business is growing. Lakshmi Narayanan, chief executive of Cognizant Technology Solutions Corp., a US-India joint venture outsourcing company, said that in order to avoid layoffs, European companies tend to outsource only projects that require new hires. The company's European operations achieved revenues of $40 million last year, significantly higher than the $10.5 million they had when they first started operations in Europe in 1998. European business has accounted for about 13% of the company's total revenue, and the rest of the income comes from the United States.
Although it is often harder to win a customer in Europe than in the US, some outsourcing companies say that once they sign a contract with a European customer, they get a trusted partner and the two parties may maintain a long-term business relationship.
"From a business perspective, the relationship between Europe is much deeper," said Infosys' Chowdhury. If the service provider makes a mistake, (European customers) is likely to give a second chance, he said, "in the United States, customers change the door more frequently."
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