Caught between Costs, Quality, and Risk: Working with One versus Multiple Firms for Translation Projects
By: Jurek Nedoma (Lido-Lang Technical Translations)
01 May 2008
In running my translation agency for the last seventeen years, I have watched the market become increasingly diverse.
Companies have started to work globally, not just internationally, and as a result their needs for translation services have evolved. The Internet has obviously brought about the most significant revolution for the translation industry and has strengthened international cooperation between companies.
There is still a considerable difference in the scale of operation between different regions of the world. At two nearly simultaneously-held conferences that I attended last year – in London (ATC) and in San Antonio, TX (ALC US) – speakers attempted to define large, medium, and small companies in the translation business. While in London small and medium companies were described as having a turnover of up to €0.5-1.0 M and €2 M, respectively, in San Antonio $10 M was suggested as the maximum turnover of a medium company. On the urging of the audience, this number was corrected down to $5 M. When applied to Poland, where my company is headquartered, that kind of classification implies that there are no large Polish translation companies. The largest translation companies in Poland have sales up to PLN8 M, which amounts to €2.3 M. Moreover, half of this amount applies to associated services that are offered by these companies – such as renting equipment for simultaneous interpretation services.
There is also a thin line between two categories: MLVs and SLVs. For example, in the Czech Republic most of the companies offer translations for both the Czech and Slovak languages due to the similarity of these two languages, as well as historical conditioning. However, we wouldn’t treat these companies as MLVs. Similarly, in the Baltic countries (Latvia, Lithuania, and Estonia) the close relation and historical bonds between these countries and Russia determine the existence of many agencies that actually translate into four languages. It is doubtful to classify them as SLVs because we cannot compare their activity to the work of companies that offer their services into 40 or 50 languages.
Considering the situation in Central Europe, I think that a fair classification of a large company is one that has a turnover of above 1 M€, and a medium company – between 0.3-1.0 M€. Moreover, as an MLV, I only include those companies that offer translations into at least 20 languages.
Leaving the classifications behind, we are left with the question of what is better for customers. In trying to find the optimum situation between costs, quality, and risk, would it be best for clients to outsource their translation jobs? Should they pay more and hand everything over to an MLV to be done by just one company? Or should they select several SLVs, or even hire freelancers, and hope for lower costs and higher quality in exchange for managing the translation of multilingual projects by themselves?
I heard an opinion once that companies can save up to 30-50% of costs by managing the translation project internally, instead of agreeing to the rates of MLVs. I disagree. Obviously, the rates offered by SLVs and MLVs differ considerably. However, we cannot forget the fact that the services provided are also different. MLVs, in addition to offering translation, take on the whole translation management process, including: providing linguistic consistency and quality, vendor management, and managing workflow. All of these things would have to be implemented by someone that is hired by the company if only working with SLVs. In analyzing the total costs, we also need to take into account that the salaries of in-house project managers are different. This provides companies that are located in Central or Eastern Europe, China or India with a certain competitive advantage.
There are people who believe that small scale companies generally deliver more consistent quality at lower costs. It is fairly natural to expect that a company dealing with translations only into their native language should have a high level of expertise. This opinion does not take into account, however, that translating only into one’s native language is an industry standard and a reasonable expectation of any company in the industry.
Moreover, using an MLV’s services provides other advantages, namely simplified communication between translators and consistency of the translation across languages. When the PM in the MLV receives an interpretation question from one of the translators, he or she can easily distribute the answer among all the people working on the respective project for each language. This is very common at our company and very often this kind of additional information also proves to be essential for the remaining translators. An MLV may even provide a tool in order to permit all the people working on one project to share their knowledge and discuss any possible doubts that they may have. Circulating that kind of information among translators is an additional job for the customer managing multiple SLVs.
Small LSPs defend their position by warning against the concentration of risk. I have heard people say that if the project manager has personal problems, the whole project that is issued to an MLV can suffer. I do not share this opinion. The human factor affects all people equally no matter where they work. The real risk exists in employing a small inexperienced company. The client must be aware that the quality of a translation relies not only on the knowledge of how to express the source text in another language. It is the whole process of organizing, translating, and verifying. Moreover, this can be executed effectively only with proper experience, advanced tools, and highly qualified translators.
If we add in the consideration that with the help of a management system that is tailored to the needs of a translation agency, one project manager can organize the entire multilingual project with just a few clicks, the benefits of using MLVs become even more obvious. In hiring many SLVs the company practically must create an entire translation department within the organizational structure of the company, which is tasked with dealing with human resources, monitoring and managing projects, settling accounts, etc. And, proper quality verification of the translations have to be organized either in one place or decentralized in other national branches of the company.
Deciding on what model of service works for a client obviously depends on the individual circumstances of the customer. However, simplistic direct comparisons such as rates cannot overshadow larger considerations such as the total cost to manage a project or the character of translation. The benefits of leveraging an MLV’s scale, experience, partner selection practices and use of technology will no doubt outweigh any risk of sourcing the entire project to one company.
Jurek Nedoma is the CEO of Lido-Lang Technical Translations, an MLV translation agency based in Krakow, Poland.