GLOBALLY DISTRIBUTED INFORMATION TECHNOLOGY WORK: A STUDY OF CROSS-CULTURAL INFLUENCES, COMMUNICATION, AND MANAGEMENT 

GLOBALLY DISTRIBUTED INFORMATION TECHNOLOGY WORK: A STUDY OF CROSS-CULTURAL INFLUENCES, COMMUNICATION, AND MANAGEMENT

ABSTRACT

Distributing information technology work globally has become increasingly prevalent and is facing a variety of challenges, including the challenge of cultural diversity management. Cultural diversity is inherent in globally distributed information technology work and has both positive and negative effects on it. Even though there is a body of literature acknowledging the relevance of cultural influences on globally distributed information technology work, there seems to be a paucity of research that addresses how cultural factors affect the globally distributed information technology work in real settings. In addition, the majority of prior crosscultural information systems research assumes national culture as the sole or main cultural boundary that determines the individual cultural identity, and depicts cultural differences through preset static dimensions.

This research draws on the theory of situating culture and social identity theory and aims to examine how cultural factors influence globally distributed information technology work as well as how global virtual team members negotiate cultural differences. This research employs an interpretative case study approach to investigate the global information technology collaborations between or among three nations, the United States of America, China, and India. Two multinational information technology companies were studied in this case. Data has been collected through interviews with 44 information technology practitioners and observations from the field studies in the United States of America, China, and India.

It was found that globally distributed information technology work is affected by the combination of different cultural factors including national culture, organizational culture, regional culture, and professional culture. These cultural factors also intertwined with other factors, such as time zone difference and infrastructure, to have impacts on communication, coordination and relationship dynamics of globally distributed information technology work. In the process of constructing their identities and negotiating the cultural differences, global virtual team members not only drew from their national and organizational backgrounds, but also drew from their individual experiences. Moreover, Chinese and Indian team members employed power relationships in their identity construction, such as core team/support team, outsourcer/outsourcee, and customer/service provider. Organizational practices including crosscultural training, leadership development, and the uses of a global delivery model and cultural liaisons facilitate cultural diversity management.

From the knowledge perspective, this research generates an in-depth understanding of cultural influences on globally distributed information technology work. Furthermore, this research adds some insights with regards to global information technology collaborations between China and the United States, which is quite limited in the existing literature. From the theoretical perspective, this research demonstrates the analytical capability of integrating the theory of situating culture and social identity theory. From the practical perspective, recommendations formulated from this research provide actionable knowledge for practitioners with respect to virtual work management, human resource management, cultural diversity management, cross-cultural training and cross-cultural knowledge management.

Chapter 1: Introduction

Globalization, the process of increased mobility of capital, commodities, technology, cultural influences, and human resources across national boundaries, is one of the most significant trends of the 21^st century (Castells, 1996; Friedman, 2006). In the information technology (IT) industry sector, globalization is manifested through the globalization of IT work, such as global IT offshore outsourcing, globally distributed information systems development, and innovation through global R&D (research & development) collaborations. The relationships between globalization and the advancement of information technology are reciprocal: the advancement of information technology has been one of the major driving forces for

globalization; the mobilization of global resources, such as financial and intellectual capitals, has also enabled speedy changes in the global IT landscape.

Global IT offshore outsourcing refers to organizational arrangements for obtaining information technology and systems products or services from external providers that are located in different countries from the clients (Hirschheim and Dibbern, 2002). Globally distributed information technology work refers to hardware, software and information systems development and management activities that involve collaborations between two or more organizations, or between one organization and its subsidiaries, which occurs across national boundaries (Huang, 2006). The difference between these two concepts is that global IT offshore outsourcing is across both national and organizational boundaries while globally distributed information technology work is across national boundaries but not necessarily across the organizational boundaries. The practices of globally distributed information technology work have continuously grown to become a significant global phenomenon (Sahay et al., 2003, Cameral and Tjia, 2005).

When compared to the traditional characteristics of information technology work, globally distributed information technology work has three unique characteristics. First, it is primarily conducted through a virtual environment that is supported by information and communication technologies (ICTs). Such virtual space is global by nature and transcends national and organizational boundaries. Second, it is situated within different complex, multilevel socio-cultural contexts. Walsham (2000, 2001) argued that the distinct cultures of different local contexts are critical factors in mediating the globalization process in the specific contexts. Therefore, the globally distributed work place has a global-local duality. Third, the practices of globally distributed information technology work have faced a variety of challenges, among which are cultural diversity and cross-cultural management.

Cultural diversity is inherent in globally distributed information technology work, given that the team members on global virtual teams have diverse national, organizational, and professional cultural backgrounds (Prikladnicki et al., 2003; Karahanna et al., 2005). Cultural diversity also has both positive and negative effects on globally distributed information technology work, which puts forward special challenges in managing the increasingly diversified global IT work and global IT workforce (Huang and Trauth, 2006; Van Knippenberg and Schippers, 2007; Ang and Inkpen, 2008). Studies showed that cultural diversity may be beneficial for enhancing creativity, flexibility, and problem solving skills, which are important for knowledge intensive work (Harrison et al., 2000; Dafoulas and Macaulay, 2001; Govindarajan and Gupta, 2001; Miroshnik, 2002; Trauth et al., 2006). However, to bring the divergent perspectives into a convergent development practice, cultural diversity may become a barrier to knowledge sharing and transference since some knowledge is contextually dependent and culturally contingent (Nicholson and Sahay, 2004). Carmel (1999), and Herbsleb and Moitra (2001) point out that while cultural diversity can be seen as an enriching factor by bringing together divergent bodies of knowledge, it can also lead to serious and chronic misunderstandings. Therefore, the effective management of cultural diversity, along with the cultivation and integration of cultural diversity will be critical for organizations to not only succeed in current global software projects, but also to develop innovative capabilities and gain the competitive advantage in the long run (Baba et al., 2004; Earley and Mosakowski, 2004, Huang and Trauth, 2006; Ang and Inkpen, 2008).

The primary objective of this research is, therefore, to understand how cross-cultural issues influence globally distributed information technology work and how to effectively manage these issues. To date, the majority of cross-cultural research in the information systems (IS) discipline assumes national culture as the sole or main cultural boundary that determines the individual cultural identity while it ignores other cultural influences (Myers and Tan, 2002). In addition, this research stream conceptualizes culture through preset static dimensions, while overlooking the complex nature of the socio-cultural context, the dynamic aspects of emergent culture, and the agency of individuals who constitute the cultural groups (Walsham, 2002). Aiming at exploring the dynamic cultural influences on globally distributed information technology work, this research draws on situating culture theory and social identity theory.

Although there is a body of literature which acknowledges the relevance of cross-cultural impacts on globally distributed information technology work, there seems to be a paucity of research that addresses how cross-cultural factors affect the globally distributed information technology work in real settings and how those influences intertwine with organizational management (Sahay et al., 2003; Gurung and Prater, 2006). More specifically, this research takes an interpretative approach and focuses on how cross-cultural factors affect global information technology work that is distributed among three countries, China, India and the United States (U.S.).

China and India not only have their own unique positions in the global IT market, they also have notable differences with respect to policy, infrastructure, and culture (Trauth, 2000).

The U.S. has historically dominated the software and IT-enabled service industry (Carmel and Tjia, 2005; ACM Report, 2006). According to Carmel and Tjia (2005), in 2003, the spending from the U.S. represented two thirds of the global IT offshore outsourcing market. They estimated that the U.S. share will remain steady in the future while the global IT offshore outsourcing market continues growing. India is the biggest IT-service provider in the global IT market and software services are India’s largest export (ACM Report, 2006). It is projected that

India’s software and services exports will be worth $50 billion by 2008 (Sahay et al., 2003). India’s dominance in the global software and services market is largely attributed to its policy liberation in the early 1990s and a large talented IT workforce, who are skilled and fluent in English (Farrell et al., 2004; ACM Report, 2006). Compared to India, China has only a small share of the global software and services market (ACM Report, 2006). China is a top-down policy-driven nation, in which the central government has significant impact on its economic development pattern (De Filippo et al., 2005; ACM Report, 2006). The national software strategy of China has traditionally focused on domestic market (ACM Report, 2006). Its software industry is highly fragmented and lacks of expertise needed to capture large international projects (De Filippo et al., 2005).

However, several studies point out that China has great potential to compete in the global software and IT services market in the future (Li and Gao, 2003; De Filippo et al., 2005; ACM

Report, 2006), supported by its continuous infrastructure development, high education improvement, and reformed software strategies (Farrell et al., 2004). According to a global outsourcing report that ranks the world’s most competitive and popular IT outsourcing destinations, China is rated number two in the current market (following India) and is expected to be number one in the next decade (Minevich and Richter, 2005). The fast development of the Chinese IT infrastructure and IT industry has attracted the attention of IS/IT scholars and practitioners (Martinsions, 2005). Communications of the ACM presented a special issue in 2005 on how the transformation China is undergoing is impacted by IT. However, in the research area of global IT collaborations between China and other countries such as the U.S., studies are quite limited.

Therefore, from the empirical perspective, this research will provide rich insights on how cross-cultural issues affect global information technology collaborations between or among China, India, and the U.S. From the theoretical perspective, this research will contribute to the extension of existing theories to different work domains and environments. From the practical perspective, this research will help practitioners develop corresponding strategies for cultural diversity management, cross-cultural training, and cross-cultural knowledge management. Furthermore, cultural diversity issues are becoming increasingly prevalent and important in future IS/IT work practices and workplaces. This research will also provide some actionable knowledge with respect to understanding and addressing cultural diversity issues.

This dissertation is composed of nine chapters. Chapter 1 introduces the research topics by addressing research backgrounds, research problems and motivations, and highlights research contributions. Chapter 2 reviews relevant literature, including published research on global information systems, virtual teams, and cross-cultural management. It also discusses the theoretical orientations that guide this research and the rationales of choosing them. This chapter concludes with a highlight on potential theoretical and practical gaps identified from the review of literature. Chapter 3 describes the research design. First it introduces three research questions and articulates the cultural conceptualization and research epistemology that underlies this research. Following that, it discusses the interpretive case study method employed in this research, including case selection, data collection procedures and methods, data analysis procedures and techniques, and research evaluation. Chapter 4 provides some background information about two companies investigated in this research. Chapter 5, 6 and 7 present the research findings that address the three research questions respectively. Chapter 8 discusses the research findings and articulates the theoretical and practical implications of this research. As a concluding chapter, Chapter 9 provides a brief summary of this research, highlights the research contributions, addresses some limitations of this research, and suggests several areas for future research.

GLOBALLY DISTRIBUTED INFORMATION TECHNOLOGY WORK: A STUDY OF CROSS-CULTURAL INFLUENCES, COMMUNICATION, AND MANAGEMENT

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