Tacit Knowledge & Soft Skill Creation in the Indian ITES Industry
Eric Eide
University of Michigan
Work in progress paper
Abstract:
Recently, Indian firms have found success in moving into “knowledge-intensive” professional
services, such as teleradiology and sophisticated data analytics in the medical and financial
industries respectively. These knowledge intensive services are fruitful sites at which to study
firm knowledge strategies because they require highly specialized skills. The skill requirements
needed to deliver these services coupled with the skill deficiencies produced by the educational
system have prompted firms to invest heavily in skills development internally. Yet, these
investments are not only in developing explicit technical or industry specific knowledge, but also
tacit technical “know-how” and interpersonal communication skills through “soft” skill training,
which are crucial skills requirements in offshore service delivery. This contribution of this paper
is to highlight the limits of explicit knowledge and the centrality of tacit knowledge and soft
skills for an ITES industry focused on service exports. This paper is based upon multiple case
study design research project focuses on four detailed cases of independent Indian firms’
strategies to create firm knowledge. The paper draws upon interviews with firm managers,
workers, leaders of trade associations, government officials, and other industry insiders
conducted during 14 months of field research in India conducted between 2006 and 2009.
Key Words: skills, knowledge, industry development
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Introduction
Knowledge has become the most important resource in post-industrial society. While
some critics classify knowledge as a “fictitious commodity” (Jessop, 2007), nonetheless
knowledge creation, capture, and dissemination have become increasingly important to economic
activity. Knowledge is crucial for a service-based economy (Bell, 1973) and for economic
development (Amsden, 2001; Drucker, 1993; Gibbons, et al., 1994; Stehr, 1994). Alice Amsden
(2001) elaborated the role of knowledge in development by specifying the building of
knowledge-based assets, which are technological and managerial in nature, as the central
ingredients to development in high technology manufacturing. One of the challenges working
with knowledge generally and knowledge-based assets specifically, however, is their tacit nature.
Scholarly and practical attention tends to focus on the more visible and easily articulated
aspects of knowledge, rather than the less visible and harder to articulate aspects. Explicit
knowledge is easily codified into words and numbers. Tacit knowledge, on the other hand, is
more difficult to express with words and numbers. Central to this observation is Polanyi’s
declaration that “we can know more than we can tell” (Polanyi, 1967, p. 4). Subsequent scholars
have further differentiated tacit knowledge along two dimensions: the technical dimension,
which includes hard to identify skills or “know-how,” and a cognitive dimension, which consists
of “schemata, mental models, beliefs, and perceptions” that we take for granted (Nonaka &
Takeuchi, 1995, p. 8). Building upon this tacit knowledge distinction, this paper will further
theorize the cognitive dimension of tacit knowledge in the delivery of ITES serves between two
cultures by analyzing firm strategies that build technical “know-how” and intercultural “soft”
skills. The importance of soft skills on success in the labor market have been highlighted by
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scholars (Moss & Tilly, 1996), but fewer studies focus on these skills in an international context
(Otis, 2008).
While scholars increasingly recognize the importance of tacit knowledge in industry
development (Amsden, 2001) and firm performance in manufacturing (Amsden, 2001; Nonaka
& Takeuchi, 1995), fewer scholars have analyzed the distinct challenges of transferring and
disseminating tacit knowledge in an increasingly important global development sector: IT
enabled services. Services are an important arena to analyze the relationship between tacit
knowledge and industry development for three reasons. First, services have emerged as the
largest and fastest-growing sector in the global economy in the last two decades, providing more
than 60 percent of global output (Banga, 2005). Developed economies tend to have a high
concentration of service employment, however, some developing countries, like their developed
country counterparts, are also becoming service-based economies. Moreover, many services that
can be performed remotely are moving “offshore” from developed economies and to developing
economies. India has become the leading exporter of IT enable services in the developing world
and this industry emerged as India’s fastest growing industry in terms of gross domestic product
(GDP). This has prompted other developing economies (e.g., China, Brazil, Philippines, Poland,
Russia and South Africa) to try to replicate the high growth rates associated with India’s service
export model (Intelligence, 2006). India’s leadership in IT enabled service industry development
suggests it is prescient to turn our analysis of tacit knowledge in services there.
Second, the unique qualities of services hint at the need to master a different set of skills
and capabilities relative to manufacturing. The unique qualities of services suggest that the route
to upgrading will differ from those found in manufacturing and retail. The characteristics that
distinguish services from other types of products are its intangibility, inseparability, variability,
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and perishability (Lievens, Moenaert, & Jegers, 1999; Lovelock & Gummesson, 2004).
Intangibility refers to the inability to see, touch, and feel a service. Instead, services are
experienced through interactions between a service provider and a client. This interaction means
that it is difficult to separate production and consumption of a service. This refers to the
inseparability of services. Services are variable or inconsistent for a couple of reasons. First,
workers are different from each other, which makes the service they provide inconsistent; second
locations may vary and different environments shape services in different ways; and third,
customers themselves vary. All of these factors make services flexible in production, imperfect
in competition, and vary in quality. Perishability in services refers to a lack of inventory. This
means managing capacity and demand are particularly challenging for firms providing services.
Third, services require unique skills relative to those required in manufacturing
industries. Industry development focused on IT enabled services requires a distinct mix of skills
relative to manufacturing industries. Compared to industrial development in manufacturing,
which emphasizes “hard” technical and managerial competence, services require in-depth
industry knowledge and proficiency in “soft” skills. Industry knowledge is specific to an industry
vertical, such as finance or chemicals. This is different than horizontal skills that are transferable
or applicable to variety of industries. Examples may include engineering or accounting skills,
which are used in a variety of industries. In practice, firms require a blending of horizontal and
vertical skills. Skills in services tend to be highly specific to an industry and a specific firm.
“Soft” skills refer to interpersonal communication skills, presentation skills, leadership skills,
norms of business dress, and cultural understanding, which are embedded within forms of tacit
knowledge.
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Firm Case Introduction
The ITES industry itself contains a wide variety of activities that range from fielding
telephone calls to R&D and sophisticated financial modeling (Dossani & Kenney, 2006). To
focus the study, I selected the financial and medical ITES industries based upon their different
propensities to specialize within industries and breadth across industries. Medical services may
contribute to a greater degree of specialized industry learning since these services are niche
products for the health services industry and they require specialized skills, particularly at the
high-skill end. Conversely, financial services tend to be generic and show more potential to
expand in breadth by producing services that are used by multiple industries. The less stringent
professional requirements and employment scalability of the financial services sector, provides a
valuable comparative dimension to medical services, which employ fewer employees in the
Indian ITES sector.
Within each industry the work force may be stratified by skill level. For example, the
financial service industry contains low-skill (i.e. data entry), medium skill (i.e. call centers), and
knowledge intensive services (i.e. data analytics), which are used by a range of industries, while
the medical services industry contains low-skill (i.e. medical transcription services), medium
skill (i.e. diagnostic image manipulation), and knowledge intensive services (i.e. radiology).
This project, however, is focused on the upper skill levels of services because these are most
important if India is going to retain a long-term advantage in services.
Financial services are also one of the most monetarily significant within the service
industry, accounting for 40 percent of the total $4.6 billion gross revenues generated in India’s
service sector (NASSCOM, 2006a). The size of the medical services export industry is more
difficult to measure relative to financial services because there are a number of medical services
5
business associations unevenly distributed across the industry. This makes membership data,
which is the primary way of assessing data on these nascent industries, difficult to acquire1.
Medical transcription was one of the first services to be offshored to India in the early 1990s and
the business has grown in revenue to USD 220-240 million (NASSCOM, 2006b). The medical
service industry, however, is significant for theoretical reasons. Radiology is an “extreme” case
of offshoring because of the high degree of tacit knowledge needed in the profession combined
with the potential harm of making mistakes (Levy & Yu, 2006). An important part of
radiological training is the residency, which is an experiential component of medical training that
is overseen by an experienced doctor. This relationship is designed to transmit the knowledge
necessary to diagnose and treat patients, yet is difficult to learn in the classroom setting. The skill
requirements and the risks inherent in the practice of this profession provide insight into the
potential of upgrading into knowledge services, while also demonstrating the potential limits on
high-skill offshore outsourcing.
The firms selected for this study were selected upon their longevity and their market
leadership in the knowledge process outsourcing industry. Infosys and Evalueserve are two firms
specializing in financial services and Teleradiology Solutions and the Global Radiology Centre
(GRC) are two teleradiology firms specializing in radiological services. Infosys, founded in
1981, is one of the top 10 IT and ITES firms in India in terms of revenue and number of
employees and now has over 100,000 employees worldwide ("Top 10 software companies in
India," 2008). While the majority of Infosys’ revenue is derived from its software services line,
the company’s acquisition of leading BPO firm Progeon in 2006 positioned Infosys as a leader in
ITES and later in Knowledge Process Outsourcing (KPO) services. Evalueserve, on the other
The National Industrial Classification statistics from the government of India lump most export service activities under a residual
category “Other business activities” (classification number 7499) because these activities are evolving faster than the government can
classify them (Ministry of Statistics and Programme Implementation, 2004). As a result, most available statistics come from industry and
industry associations themselves.
1
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hand, was one of the first “pure” Knowledge Process Outsourcing firms and coined the term in
order to differentiate their “knowledge intensive” services from the lower skill level call center
and data entry work that defined early periods of ITES in India. Evalueserve was founded in
2000 and has over 2200 employees working on various service lines, including investment and
patient research. Both firms have a majority of their KPO revenue generated in financial services.
Teleradiology is a relatively small niche service export industry and both Teleradiology
Solutions and the GRC are the longest running firms providing these services from India
(Chandran, 2008). Teleradiology Solutions was founded in 2001 and currently has
approximately 180 employees. The GRC, which is a joint venture between top IT company
Wipro and a Bangalore based hospital, was founded in 2002 and has 22 employees. Evalueserve
and Teleradiology Solutions focus on slightly more specialized services relative to Infosys and
the GRC (see Table 1).
This paper draws upon 95 semi-structured interviews collected during 14 months of field
research in India and the United States conducted between July 2006 and May 2009. In
particular, the paper draws heavily upon interviews conducted across four firm case studies,
although the paper also draws upon primary source documents from trade associations, the
Government of India, newspapers, trade publications and magazines, to compliment and
corroborate interviews data where possible.
Explicit Knowledge and Knowledge Externalization
Firms codify knowledge in order to capture, disseminate, and build upon knowledge
within the organization. This codification process, which transfers tacit knowledge into explicit
knowledge is called “externalization” (Nonaka & Takeuchi, 1995). Firms across industrial
7
sectors try to externalize knowledge in order to make it easier to access, while also reducing the
firm’s dependence on specific employees who possess technical “know-how”. However, there
appears to be an even greater externalization impulse for firms in IT enabled services relative to
manufacturing. Extensive externalization of knowledge must occur before a service is
transferred from one country to another. In order to replicate a service, it first needs to be
studied and codified before a parallel process can be replicated in the offshore location. Service
firms may try to take additional steps to codify knowledge in an effort to exert some control over
the intangibility and variability of services. Service firms implement mechanisms that assist in
the rationalization and codification process, such as quality assurance processes and knowledge
management systems. Yet, knowledge gaps, particularly along tacit dimensions, may persist,
despite the knowledge externalization achieved through these mechanisms.
Learning and Sharing Technical “Know-How”
There are aspects of technical “know-how” that are embedded within a given task or
technology and these may be difficult to extract and transfer. In practice, for example,
technology transfer rarely results in analogous capabilities between those possessing the
technology and those who seek to acquire it (Amsden, 2001). This loss of capability is due to the
incomplete specification of technology where knowledge transfer tends to decline as technical
“know-how” becomes increasingly tacit. Although the tacit knowledge for some offshore
services, such as data entry and call center work, tend to be highly externalized and scripted,
other services, such as knowledge intensive services, which require high levels interpretation,
tend to be much more difficult to externalize.
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The interpretation of radiological images and production of three-dimensional (3D)
imagery in teleradiology work is difficult to standardize or explicitly articulate. Teleradiology
3D lab work, which is less skill intensive than reporting final diagnosis of radiological images,
still requires a high degree of interpretation. For example, a business manager working with 3D
imagery called radiology “a very perceptive science” (emphasis added)(Interview 16, GRC,
10/17/07). The manager emphasizes the interpretive element of 3D work, which hinges upon
one’s ability to perceive or distinguish ambiguous abnormalities from initial two-dimensional
image. The supervising radiologist at the GRC elaborated that the proficiency in 3D imagery
requires “aptitude” and the radiology or technologist qualification does not necessarily translate
into the aptitude necessary for the job (Interview 55, GRC, 4/16/08). The required aptitude in 3D
imagery refer to a developed competency that is distinct from the more explicit knowledge a
radiologist or technologist may receive through their more formalized classroom training and
book based learning.
Multiple doctors at the GRC used the metaphor of “art” to help describe the skill and
knowledge requirements required for the production of a quality 3D image in 3D lab work (to
see an example refer to the sample images of 3D imagery in the appendix):
“So apart from the knowledge, it is more like an art. So there are some guys who are
more artistic in giving the images. So it is not only the knowledge that you have, an
element of art is also there . . . . Some, they struggle to create it, for some it is a ‘cake
walk’ so they prefer to stick on to it for a long period of time. Some move out” (Interview
17, Radiologist, GRC, 11/1/07).
Here the artistic skill, or tacit technical “know-how” required to produce a 3D image is described
in opposition to (explicit) knowledge, yet the emphasis is on how crucial the tacit knowledge is
9
for job success. According to this radiologist, the workers that are unable to learn these artistic or
tacit components of the work do not stick with the job and leave the firm. The references to art,
rather than science, underscore the interpretive and hard to articulate approach to radiology
service research.
The use of the metaphor of art to describe the attributes and skill requirements of
knowledge intensive services is not unique to radiology. For example, one manager conducting
investment research replied that, “there is no such standard process, it is research. Research is an
art. It is not a science where you follow a process…” (Interview 42, Evalueserve, 2/13/08). This
quote demonstrates the difficulty in completely externalizing tacit aspects of knowledge into
easy to follow scripted steps. While one may possess a general methodology or framework for
research, it is difficult to complicated and interpretative processes such as conducting research
into a strictly followed routine.
Mechanisms that Transmit technical “know-how”
Technical “know-how” in offshore service work is transmitted through interactive
methods for knowledge sharing. Transmission of knowledge may occur between the client and
the service firm, between individual workers and teams inside the service firm itself, and
between firm employees and other individuals located outside a specific firm through networks
that are embedded within a broader community. These mechanisms include a number of less
structured forms such as team interaction, mentorship, knowledge sharing sessions, and the use
of collaborative technologies, such as, internal company discussion boards and “Wikis,” and
industry and community based networks.
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All 4 firms in this study used a combination of methods depending on the stage the
offshore outsourcing relationship was at. In preparation for a transition of a service from the
client site to the offshore firm employees may visit the client location to observe work methods
and meet one-on-one with client employees around specific aspects of a process to learn as much
as possible about the tacit routines that underlie the explicitly articulated aspects of a work
process. BPO firms often use a cost effective “train-the-trainer” approach in transitioning
services. Under this model a small portion of employees visit the client site, document the
client’s work process, and later return to the service delivery site and train the rest of the team.
However, tacit technical “know-how” may “leak” or be lost in transition through this “train-thetrainer” approach thereby causing potential future problems in the service delivery process. A
manager at Infosys described how knowledge leakage occurs:
“…when somebody is teaching me something as they know [it] … They will probably
disclose 80 percent and that may be unconsciously. There is always that 20 percent that
you may not, we may forget to transfer. Then if I have absorbed, if I have heard 80
percent, chances are [I] absorbed 60 to 70 percent, then I come offshore, I will probably
transfer 50 percent because I have forgotten the rest” (Interview 88, 4/23/09).
The above quote describes how both tacit and explicit information may be lost. To combat this
type of knowledge leakage, some clients, particularly if it is the beginning of a large long-term
relationship, may send employees abroad to train all offshore service workers. Once the service
transition has occurred, firms often use weekly conference calls and daily or weekly email
correspondence with the client as the primary methods of continually transmitting tacit forms of
knowledge. These regular calls are a key way to insure clarification around expectations that
were not clearly articulated in written documents may be addressed.
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Firms themselves may craft a number of strategies to disseminate tacit knowledge
through the firm. Mentorship and team learning are primary routes that help transmit tacit
technical “know-how” within a company. One-on-one mentorship is the primary way tacit
knowledge is disseminated within the small number of employees at the GRC. Larger firms may
rely on presentations alongside mentorship strategies within a functional team. For example,
executives and managers at Evalueserve and Teleradiology Solutions described on-going
presentations that are used to transmit new methodologies, procedures, and innovations to their
team or firm. For example, Evaluserve coordinates and conducts knowledge sharing sessions at
the team level within a specific division, such as “Investment Research.” These presentations,
utilize power point presentations, which contain a combination of words, pictures, animation,
and video, which may help transmit explicit and some forms of tacit knowledge about a given
subject. However, the “Question and Answer” exchange during and at the end of these
presentations help transmit the more tacit technical aspects of a given subject.
Teleradiology Solutions, on the other hand, uses an internal weekly review of “difficult
or interesting cases” to show radiologists at the company the hard to explain aspects of a given
case. The images are projected in an auditorium where radiologists are encouraged to discuss the
varying interpretations they may have in diagnosing the abnormality (Interview 41, Founder,
Teleradiology Solutions, 1/31/08). Projecting the visual image during these sessions permits
people to identify certain areas of interest, often highlighting them with a laser pointer, and then
perhaps contrasting these images with other “normal” cases. The visual highlighting of specific
areas and the comparisons are key approaches in helping doctors understand the uniqueness of an
abnormality that is otherwise difficult to verbalize.
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Finally, networks of people located outside the firm may also serve as a mechanism that
transmits tacit technical “know-how”. The IT and ITES industries are highly networked in
industry hub cities such as Bangalore (Interview 85, Core Committee Member of Bangalore K
Community & Executive at Mindtree, 4/1/09) and these networks facilitate knowledge sharing
amongst its members.
While networks are widely regarded as mechanisms that transmit resources, including
knowledge (Hargadon, 2002; O’Riain, 2000; Owen-Smith & Powell, 2004; Small, 2009),
networks are particularly important in India where larger gaps exist between explicitly
articulated rules and actual routines people follow relative to the United States. According to one
industry executive, Indian workers value, use, and rely on their networks more than U.S. workers
(Interview 85, Executive, Mindtree, 4/1/09). An example of a professional network that has the
expressed goal of sharing industry knowledge and knowledge management strategies is the “K
Community India.” The K Community is an initiative started in 2005 and supported by the
Confederation of Indian Industry (CII), which is an overarching Indian trade association. The
Community currently has 965 members across the country that interact through online discussion
boards ("K Community - India," 2010). Participants can also join regional networks, such as the
“Bangalore K Community,” which contain sub-networks of over a hundred professionals
residing in or around the city of Bangalore, India ("K Community - India," 2010). The benefit of
the regional groups is that members are able to regularly meet face-to-face through knowledge
sharing events and lectures in order to share knowledge and form deeper networks that in turn
help facilitate knowledge transmission and production. The strategies identified above transmit
technical “know-how”, but these same practices may also fail to transmit tacit knowledge that is
cognitive embedded within culture.
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Knowledge Externalization, Culture, and “Soft” Skills
Work output expectations may be explicitly articulated, yet work expectations may not be
sufficiently met. An offshore worker may follow an explicitly articulated procedure specified
and codified through quality assurance procedures or a work methodology, yet the output may
still not meet client expectations. Dissatisfaction with performance may occur because of the
cultural cognitive norms that underlie expectations of work. These components may not be
articulated or transferred, because of their “taken-for-granted” nature within a given (western)
cultural milieu. A VP of a North American multinational company responsible for offshoring
services to India, wrote about the performance problems that may result from cultural difference,
even when work output metrics are meticulously followed:
“The test team is the weakest part of the organization in terms of efficiency and
effectiveness. [The group is characterized by a] very strong focus on metrics (execution
rate, pass rate, etc.) with no real understanding of the impact or what really needs to be
done to report on quality and customer value. . . The biggest obstacle is [a] change in
culture. . . . The rituals are followed religiously, but some of the spirit is lost” (emphasis
added) (personal email correspondence, 11/10/09).
The above quote suggests that even when a team is focuses upon following explicitly articulated
metrics; overall quality and customer satisfaction may suffer. The tacit assumptions that are
embedded in cultural norms are not transmitted along with the explicit metrics. For the workers,
the meaning of “customer value” and how they can work toward achieving it is unclearly
specified, particularly from their cultural location. The quote above simultaneously demonstrates
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the limitations of explicit knowledge, while underlying the centrality of tacit cultural norms that
are embedded in expectations of work in a cross-cultural work context.
Similarly, the way that explicit agreement or disagreement are made across cultures
exemplify cultural tacit challenges in offshore services. In the United States people tend to take
explicitly articulated statements at face value. For example, when a client asks if a specific
service can be implemented by a specific date, and hears “yes,” then that client will reasonably
expect that the service will be implemented by that date. If that date is not met, however, the
client will be upset and believe that they have been deceived or that the vendor did not meet
expectations. For Indians who live in a society that is more culturally sensitive to status
hierarchy, however, it is considered overly direct to tell a superior “no, we cannot meet your
deadline.” When Indian employees are asked a difficult question, they may be evasive, but
tacitly agree with their client in order to avert conflict with a perceived superior. The subtext
communicated by the Indian worker, that the client may fail to pick up on, is “we will try.”
Consistent with these observations, another North American Manager commenting upon his
Indian offshore workers wrote that, “People say ‘yes’ to requests; however it requires constant
follow-up for them to deliver” (Manager of North American multinational, personal email
correspondence, 11/8/09). Failure to meet the client’s explicit deadline may be terms for ending a
relationship or at the very least cautiousness in allowing the offshore team to manage more
critical tasks. This is turn may have a detrimental impact on the future offshoring relationship,
especially as it relates to moving into higher value tasks.
Soft skills and cultural understanding are important skills at any stage of an outsourcing
relationship, but particularly in the early stages of the relationship when services are being
transitioned for the first time. A transition manager at Infosys reported that those employees
15
working on transitioning services from one-country to another need industry specific knowledge,
but they should also have good peoples’ skills and “soft” skills (Interview 32, 11/29/07).
Another Infosys manager who was involved with starting up a 300 full time employee project for
a client emphasized the importance of tailoring soft skills training programs to inculcate
interpersonal communication skills and an understanding of what norms are expected in the US
business culture:
“I want . . . [employees] extremely comfortable talking on the phone with the client, I
want them to get attuned to an American accent because the minute they come on the
floor, the day they join me, there is going to be trainers from the US here for the next 8
weeks. They need to be able to understand them. They need to be able to be comfortable
with them and ask the right questions. They need to be able to speak up, for example,
which is a huge issue with lot of Indians” (Interview 88, Director, 4/23/09).
The quote above highlights the difficulty that India workers may have in understanding
American clients, but also the importance of learning to proactively ask questions when
something is unclear. American businesspersons will expect to hear clarifying questions if
employees are unclear about instructions and will not generally look for more tacit cues that
people may not understand the instructions provided.
A related challenge identified by an Evalueserve executive is how to manage the
differing cultures of its own employees working across four global operating centers (India,
China, Chile, and Romania) and the firm’s sales force and their customers based primarily in
American and Europe:
“That’s where it becomes more of a sociological issue and more of an interaction issue
and more of a cultural issue. That is not about processes alone, it is about culture
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understanding, it is about the ‘softer’ side of things . . . . We have people from . . . 75
countries working in the company right now, and forget about India and China versus
Europe and the US where there is huge cultural difference everywhere. Even within the
Central European countries, I mean the way a Swiss will think will be very different from
the way French will think. . . . In 7 years we . . . created a global multinational company.
I mean, you can understand being a sociology student yourself what that means in terms
of cultural challenges that we face” (Interview 41, 2/12/08).
This quote emphasizes the cultural cognitive challenges that offshoring firms may experience not
only with their foreign-based clients, but also with their own employees who are increasingly
globally dispersed. These internal cultural challenges are expected to increase, as “Indian”
service firms increasingly become multinational organizations2.
In order to get employees to better understand communication coming from another
culture, IT enabled service firms across India invest heavily in “soft” skills training. Soft skills
training includes training in three overlapping areas: 1) business skills and etiquette, 2)
communication skills, and 3) learning what is “appropriate” in a client’s business culture. All
four firms profiled in this study offered and emphasized “soft skills” training to provide
employees the tools to reduce cultural cognitive misunderstanding between cultures. Soft skills
include interpersonal communication (via phone, email, face-to-face interaction), presentation
skills, leadership skills, norms of business dress, cultural understanding, which are embedded
within forms of tacit knowledge.
Firms teach business skills and etiquette because most newly hired ITES employees in
India lack work experience. The typical service employee tends to be in their twenties and
2
Leading offshore outsourcing service firms are now outsourcing to new locations that have lower costs or specific
hard to find capabilities, such as language specialization (Giridharadas, 2007).
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relatively inexperienced in the workplace. Even workers who recently completed graduate
training in India, which is particularly common in knowledge intensive services, tend to lack
work experience relative to their counterparts in the United States. This is because Indians do not
usually work in the workforce between completing their undergraduate course work and starting
their graduate programs. In the U.S. students often work an average of 2 to 4 years before
returning to graduate school. These differences mean that Indian graduate students receive little
exposure to the workforce environment prior to starting work and have they have fewer
opportunities to learn western cultural expectations as residents in India. For this reason, a lot of
the soft skills trainings try to teach business socialization skills of some kind. At the Infosys’
Leadership Institute, which is a formal part of new hire training, for example, employees are
taught business fundamentals, such as, how to work in a team, e-mail etiquette, and other
corporate practices (Interview 66, Group Leader, 12/15/08).
Many employees working in knowledge intensive services require some English
language practice, particularly in speaking in an accent that is understandable to clients. Some
employees interviewed expressed difficulty with English communication, particularly if they
grew up in rural areas in India, where fewer schools teach in English and the English instruction
tends to be of a lower quality than found in the urban centers. Even proficient English speakers
may have trouble understanding American English accents and phrases, and customers may
similarly experience trouble understanding their offshore Indian workers.
There are various approaches to teaching soft skills, which include informal instruction
coordinated by a manager or a mentor, team socialization, and formal classroom training
programs, E-learning modules, and outside consultations. Team level socialization, group
trainings, and exercises may provide a forum for presentations. Group level training may also
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include customer role-plays in front of a group that can comment and learn from the interaction.
At the GRC, for example, there is a cohesive and congenial team atmosphere and soft skills
training occur at the team level itself where experienced members and managers mentor new
employees. Soft skills training, particularly for employees from rural areas, focus on
communications skills. At Evalueserve, they have a more formalized presentation skills training
programs where employees can make a speech that is recorded on video that receives feedback
from training experts in oral communication and public speaking that provide feedback on the
strengths and areas of improvement, covering such areas as body language, tone, and
presentation content (Interview 41, Executive, Evalueserve). All 4 firms used either e-learning
modules, developed internal or externally by outside consultants, to help facilitate some of the
“harder” aspects of soft skills training, such as explicit business rules and examples of business
emails.
Conclusion
An analysis of knowledge intensive services based on four knowledge intensive services
demonstrates that industry upgrading does not depend solely on learning “hard” skills, but also
on “soft” skills that include tacit knowledge, impression management skills, and embodied
cultural capital. Externalization may help firms capture tacit knowledge, but it cannot solve all
related tacit problems. Indeed, over reliance on explicitly articulated frameworks and metrics
may actually obscure the tacitly expressed goals and knowledge elements culturally embedded,
especially when moving across cultures in business. Intercultural skills embedded in cultural
cognitive frameworks will be required as long as Indian service firms are focused upon export
markets or have co-workers based in foreign countries.
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Knowledge intensive service also require a degree of technical “know-how” that may
only be partially explicitly articulated. Service firms from this study have adopted a variety of
strategies to try to capture and disseminate these aspects of tacit knowledge ranging from oneon-one mentorship, to visual knowledge sharing sessions, to broader networks that extend
beyond the firm.
This analysis depicts firms are the primary actors in trying to create, capture, disseminate
tacit components of knowledge necessary for offshore services. However, there are other
organizations, universities, and governments that are involved in trying to address some of these
tacit knowledge issues at a broader industry level in India. One example is the CII support of the
“K Community – India” network and their regional groups discussed above. Another example, is
the trade association representing the software and services industry in India, NASSCOM, which
is working with government and universities to craft training programs that more appropriately
address India’s skill gap in a number of skill and knowledge areas. A component of these skills
focus on the development of “soft” skills and professional skills required for employment along
side more traditional explicitly articulated technical capabilities and industry knowledge
(Interview 086, Director, NASSCOM, 4/7/209). According to a senior civil servant who has
worked with NASSCOM, the trade association was working with government, firms, and
universities to upgrade worker skills and part of these efforts were focused on providing “soft”
skill development and English language development alongside more traditional academic
studies (Interview 80, Government Official, 2/27/09). The purpose of the NASSCOM supported
program is to increase the soft skills in graduates before they reached the labor market.
20
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Appendix: Tacit dimensions of work across 4 Firm Cases
KPO
More
Specialized
Medical
Teleradiology Solutions:
Core service: Radiology reporting
Finance
Evalueserve:
Core service: Financial and patient research
Skill requirements:
Interpretive knowledge to assess
abnormalities in imaging technology
Skill requirements:
Analytical skills and in-depth financial
literacy
Skilled Employee profile:
30 US ABR Radiologists & some
Indian certified radiologists
Skilled Employee profile:
1700 research analysts; engineers, MBA’s,
intellectual property lawyers, PhDs, chartered
accountants, statisticians
Tacit technical “know-how”
Knowledge sharing sessions and
weekly visual review sessions of
“difficult” cases.
Tacit technical “know-how”
“Research is an art”
Team knowledge sharing sessions
“Soft-skills” Training:
Internal & external consultants train on
business, leadership, & communication
skills
Global Radiology Center:
Core service: Manipulation of MRI or
CT scan from 2D to 3D image
Skill requirements:
Interpretive knowledge to assess
abnormalities in imaging technology
Less
Specialized
“Soft-skills” Training:
Cultural training of employees to interact with
culturally diverse clients & employees. Video
recording & feedback on presentation skills.
Infosys BPO, Knowledge Services
Core services: Financial analytics, research.
Skill requirements:
Analytical skills and in-depth financial
literacy
Skilled Employee profile:
1000 highly skilled professionals, including
chartered accountants, MBAs, engineers,
statisticians and economics graduates
Skilled Employee profile:
4 Indian certified radiologists & 4
certified technologists
Tacit technical “know-how”
Aptitude: “more art than science”
One-on-one & team mentorship
Tacit technical “know-how”
Company discussion boards and “Wikis”
provide collaborative discussions around
topics. Team collaboration.
“Soft-skills” Training:
One-on-one & team mentorship
“Soft-skills” Training:
Highly structured soft-skill training
environment. Online modules & tutorials.
 Specialization: Defined as how interpretive and customized the work is. If it tends to be more routinized, less tailored/
customized, it therefore less specialized. The degree of industry skill and knowledge (domain knowledge) required for a
job tends to increase the specialization of that job.
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3-D Imagery samples downloaded from MGH website:
http://www.mgh3drad.org/index_noflash.html
Producing 3D imagery from a 2D image to enhance radiological diagnosis.
“So apart from the knowledge, it is more like an art”
(Interview 17, Radiologist, GRC, 11/1/07).
Sample 1: 3D reconstruction of neck CTA showing carotid bifurcation used to assess stenosis.
Sample 2: 3D reconstruction of CT Urograph shows two ureters on the left side.
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