Technology Adoption and Competitive Advantage in the Translation Industry
Contents <ul><li>What is Project/Open? </li></ul><ul><ul><li>Project-ERP </li></ul></ul><ul><ul><li>What is Open-Source? <...
What is Project/Open?
What is Project/Open? <ul><li>“ Project-ERP” </li></ul><ul><li>Integration Solution for Translation Agencies </li></ul><ul...
What is Open-Source? <ul><li>Everybody can use and copy  open-source programs </li></ul><ul><li>“ Science model”: Everybod...
Competition  in the Translation Industry
Translation Value Chain <ul><li>The “classical” MLV (Multi Language Vendor) uses a lot of freelancer (“Editing” and “Trans...
Translation Value Chain <ul><li>Larger or more sophisticated (localization) projects require specialized resources, so the...
Translation Value Chain <ul><li>As a result, MLVs get frequently bypassed or “disintermediated” </li></ul><ul><li>Customer...
Translation Value Chain <ul><li>MLVs try to defend by “integrating upwards” towards the customer to create lock-in and by ...
<ul><li>This feels like the California gold rush. Just make sure to  sell tools and denims… </li></ul><ul><li>We are selli...
Arenas and Strategies Customer Integration <ul><li>Learn </li></ul><ul><li>Improve </li></ul><ul><li>Learn </li></ul>Sales...
How to fight? <ul><li>Best management practices in each area/department </li></ul><ul><li>IT tools </li></ul>Competitive „...
Example: TM-Adoption
TM-Adoption <ul><li>Benefit </li></ul><ul><li>Very useful (saves 20%-50% of the work) </li></ul><ul><li>Driving Force </li...
Types of Adopters <ul><li>Innovators (“Techies”) </li></ul><ul><ul><li>Appreciate technology for its own sake </li></ul></...
Technology Portfolio 19 95 2000 200 5 20 10 0% 20% 40% 60% 80% 100% 19 80 1990 Translation  Memories 19 85 Email in Transl...
New Technologies
Translation IT Trends <ul><li>Problem </li></ul><ul><li>Clumsy handling of files </li></ul><ul><li>Communication in large ...
Technology Portfolio 19 95 2000 200 5 20 10 0% 20% 40% 60% 80% 100% 19 80 1990 Translation  Memories 19 85 Email in Transl...
Jochen Hummel (Trados) <ul><li>„ For the next   wave of innovation, however, the key ingredient is what we at   TRADOS are...
Translation Value Chain MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. SLV MLV SLV
Optimization Potential <ul><li>The analysis of the optimization potential has lead us to the modules of Project/Open </li>...
Conclusion <ul><li>Know in what arenas you are playing </li></ul><ul><li>Focus on a single area at a time </li></ul><ul><l...
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Technology Adoption and Competitiveness in the Translation ...

  1. 1. Technology Adoption and Competitive Advantage in the Translation Industry
  2. 2. Contents <ul><li>What is Project/Open? </li></ul><ul><ul><li>Project-ERP </li></ul></ul><ul><ul><li>What is Open-Source? </li></ul></ul><ul><li>Competition in the Translation Industry </li></ul><ul><ul><li>Sources </li></ul></ul><ul><ul><li>Arenas </li></ul></ul><ul><li>Technology Adoption </li></ul><ul><ul><li>Example: Translation Memories </li></ul></ul><ul><li>New Technologies </li></ul><ul><li>Project/Open Modules </li></ul>
  3. 3. What is Project/Open?
  4. 4. What is Project/Open? <ul><li>“ Project-ERP” </li></ul><ul><li>Integration Solution for Translation Agencies </li></ul><ul><li>100% pure Internet </li></ul><ul><li>It’s mostly free software! </li></ul><ul><li>We earn our money with additional modules, installation and support </li></ul>Projects Users Clients Costs File Storage Work- flow Sales Trados Integra- tion Project Forum Freelance Database Invoicing Purchase Orders
  5. 5. What is Open-Source? <ul><li>Everybody can use and copy open-source programs </li></ul><ul><li>“ Science model”: Everybody contributes and shares </li></ul><ul><li>Mouth-to-mouth marketing </li></ul><ul><li>Development costs are much lower </li></ul><ul><li>Sales costs are much lower </li></ul><ul><li>Revenues from installation & support are sufficient </li></ul>
  6. 6. Competition in the Translation Industry
  7. 7. Translation Value Chain <ul><li>The “classical” MLV (Multi Language Vendor) uses a lot of freelancer (“Editing” and “Trans.”) to provide the service for his customers. </li></ul><ul><li>Only a few language resources (“QC”) are working in-house as staff. </li></ul>MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. The “Classical” MLV Model
  8. 8. Translation Value Chain <ul><li>Larger or more sophisticated (localization) projects require specialized resources, so the MLV needs to subcontract to specialized SLVs </li></ul><ul><li>However, these SLVs are not allowed to communicate with the client directly, resulting in a huge overhead. </li></ul><ul><li>The “valued” contributed by MLV is limited to sales, QC and PM </li></ul>MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. Subcontracting to SLVs SLV MLV
  9. 9. Translation Value Chain <ul><li>As a result, MLVs get frequently bypassed or “disintermediated” </li></ul><ul><li>Customers start to work with sophisticated SLVs directly and save up to 40% </li></ul>MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. Bypassing the MLV SLV SLV MLV
  10. 10. Translation Value Chain <ul><li>MLVs try to defend by “integrating upwards” towards the customer to create lock-in and by beefing up their sales force </li></ul><ul><li>Lionbridge’s losses have reduced since 2002… </li></ul>MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. MLV Defensive strategies SLV SLV MLV
  11. 11. <ul><li>This feels like the California gold rush. Just make sure to sell tools and denims… </li></ul><ul><li>We are selling Translation Workflow… :-) </li></ul>Translation Value Chain MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. Fighting Arenas SLV SLV MLV Arenas
  12. 12. Arenas and Strategies Customer Integration <ul><li>Learn </li></ul><ul><li>Improve </li></ul><ul><li>Learn </li></ul>Sales Staffing Project Management <ul><li>Learn </li></ul>Quality Management “ Production” Organization <ul><li>Improve </li></ul><ul><li>Specialize on the language </li></ul><ul><li>Improve </li></ul><ul><li>Improve </li></ul><ul><li>Learn </li></ul><ul><li>Learn </li></ul><ul><li>Improve </li></ul>Small MLV SLV Freel. Large MLV Service <ul><li>Learn </li></ul><ul><li>Extend/ Defend </li></ul><ul><li>Defend </li></ul><ul><li>Defend </li></ul><ul><li>Defend </li></ul><ul><li>Improve/ Defend </li></ul><ul><li>Defend </li></ul><ul><li>Improve/ Defend </li></ul>Arena
  13. 13. How to fight? <ul><li>Best management practices in each area/department </li></ul><ul><li>IT tools </li></ul>Competitive „Weapons“ Strategic Operational Efficiency <ul><li>Specialization </li></ul><ul><ul><li>Languages </li></ul></ul><ul><ul><li>subject area </li></ul></ul><ul><ul><li>industry sector, </li></ul></ul><ul><ul><li>. . . </li></ul></ul><ul><li>Size </li></ul><ul><li>. . . </li></ul>
  14. 14. Example: TM-Adoption
  15. 15. TM-Adoption <ul><li>Benefit </li></ul><ul><li>Very useful (saves 20%-50% of the work) </li></ul><ul><li>Driving Force </li></ul><ul><li>Intense Competition, particularly after the advent of the Internet </li></ul><ul><li>Why did adoption take so long? </li></ul><ul><li>Translators are normally not very tech-savvy. </li></ul><ul><li>TMs became easy to use only with the appearance of Windows/ Mac OS </li></ul>Figures from LISA 2002 TM Survey Interpolations 2005 0% 20% 40% 60% 80% 100% 1990 1995 2000 Competitive Advantage for Early Majority Companies that replied to the LISA 2002 TM Survey
  16. 16. Types of Adopters <ul><li>Innovators (“Techies”) </li></ul><ul><ul><li>Appreciate technology for its own sake </li></ul></ul><ul><li>Early Adopters („Visionaries“) </li></ul><ul><ul><li>Will accept an 80% solution </li></ul></ul><ul><li>Early Majority („Pragmatists“) </li></ul><ul><ul><li>Want a complete solution </li></ul></ul><ul><ul><li>Want to see it working </li></ul></ul><ul><li>Late Majority (“Conservatives”) </li></ul><ul><ul><li>Focus on who else is doing it </li></ul></ul><ul><ul><li>Emphasize maturity of the technology </li></ul></ul><ul><li>Laggards (“Skeptics”) </li></ul>Source: Everett Rogers , “Diffusion of Innovations” , 1962 Late Majority Laggards Early Majority Early Adopters Innovators 0% 20% 40% 60% 80% 1990 1995 2000 2005 100% 1990 1995 2000 2005
  17. 17. Technology Portfolio 19 95 2000 200 5 20 10 0% 20% 40% 60% 80% 100% 19 80 1990 Translation Memories 19 85 Email in Translation Companies Fax in Translation Companies Qualitative curves for Fax and Email adoption
  18. 18. New Technologies
  19. 19. Translation IT Trends <ul><li>Problem </li></ul><ul><li>Clumsy handling of files </li></ul><ul><li>Communication in large project teams </li></ul><ul><li>Hassle to manage TMs </li></ul><ul><li>What is quality??? </li></ul><ul><li>Price pressure, complex freelance market </li></ul><ul><li>Long PM telephone calls with freelancers </li></ul><ul><li>Solution </li></ul><ul><li>Extranets for file download/ upload (FTP-Servers, Web-Access, …) </li></ul><ul><li>Project Collaboration </li></ul><ul><li>Distributed TM </li></ul><ul><li>Quality Management/ Database </li></ul><ul><li>Integrated Freelance/ Provider Databases (across offices, integrated with Quality DB) </li></ul><ul><li>Freelance Self Service </li></ul>
  20. 20. Technology Portfolio 19 95 2000 200 5 20 10 0% 20% 40% 60% 80% 100% 19 80 1990 Translation Memories 19 85 Email in Translation Companies Fax in Translation Companies Qualitative curves for Fax and Email Project-ERP Distributed TM?
  21. 21. Jochen Hummel (Trados) <ul><li>„ For the next wave of innovation, however, the key ingredient is what we at TRADOS are calling “collaborative workflow.” </li></ul><ul><li>By combining technology support for localization project managers with a platform that provides task and process automation along the entire supply chain, collaboration between corporations, language service providers, and translators will reach a degree of transparency and efficiency that was heretofore impossible. &quot; </li></ul>&quot;But here’s the key: it is only by making improvements along the entire supply chain that the industry can be transformed and enjoy the benefits of its next wave of growth.” Jochen Hummel, CTO Trados Source: Client Side News 08.03
  22. 22. Translation Value Chain MLV Clients PM Editing Sales Staffing QC Trans. Quality Man. SLV MLV SLV
  23. 23. Optimization Potential <ul><li>The analysis of the optimization potential has lead us to the modules of Project/Open </li></ul><ul><li>The introduction of IT-tools is frequently meant to improve best-practices as well. </li></ul>Customer Integration Sales Staffing Project Management Quality Management “ Production” Organization Service <ul><li>Integrated Workflows </li></ul><ul><li>Multilingual CMS </li></ul><ul><li>Custom Apps. </li></ul><ul><li>Sales force automation </li></ul><ul><li>CRM </li></ul><ul><li>Data Warehouse </li></ul><ul><li>Integrated freelance databases </li></ul><ul><li>Quality database, integrated with freelance database </li></ul><ul><li>Translation Workflow </li></ul><ul><li>Semiautomatic PM </li></ul><ul><li>Balanced Scorecard </li></ul><ul><li>Internet Project Collaboration </li></ul><ul><li>Intranets/ Extranets </li></ul><ul><li>Service Mgmt. </li></ul><ul><li>CRM </li></ul><ul><li>Scorecards </li></ul>Projects Users Clients Costs File Storage Work- flow Sales Trados Integra- tion Project Forum Freelance Database Invoicing FL- Purchase Orders 1 2 3 4 5 6 7 8 9 10
  24. 24. Conclusion <ul><li>Know in what arenas you are playing </li></ul><ul><li>Focus on a single area at a time </li></ul><ul><li>Choose your weapons </li></ul><ul><li>Don’t chose the wrong ones! </li></ul>Frank Bergmann [email_address] www.project-open.com Project/ Open
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