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In this blog post, we talk about the new trends that arise from the effects of globalization and localization in the translation industry.

The translation industry is experiencing a most exciting time of opportunities. In my previous article - The Story of the Translation Industry in 22 - I described ten different innovation themes with an inside-outward looking perspective. In this article I take a view from the outside observing sentiments that could dampen the growth and opportunity curve of the translation industry. Political fashions seem to be leaning more towards protectionism. Companies tend to think that they are more globalized than they in fact are, and find that they are spending enough on localization. The art of localization is to exploit the differences in cultures rather than simplifying them to global standards. We knew that, but do we really practice it? Now more than ever, stakeholders in the translation industry need to be firm about their mission and the unique role they have in their companies’ and clients’ globalization strategies. They need to be “locamaniacs”.

The Globaloney Virus

There is no question that the fortune and growth of the translation industry is part and parcel of the megatrend of globalization. If it wasn’t for the tremendous growth of international trade in recent decades, we wouldn’t have seen the translation sector developing so fast. In that sense, translation is just a ‘child’ of globalization. And now that globalization is under threat, it’s time for the translation industry to stand up and help their ‘parent’.

Globalization has fallen victim to populist politicians and macho businessmen who feed their audiences with stories of fear and desire. It’s a virus that is spreading quickly. It has even been given a name, ‘globaloney’, and a definition: silly, nonsensical or absurd ideas or talk on global issues.

Politicians may grossly exaggerate job losses due to globalization, or the percentage of Muslims living in a country. And as it turns out, people easily copy this fake news. According to market research undertaken by IPSOS MORI in forty countries on the ‘perils of perception,’ people generally overestimate the percentage of Muslims living in their country. In France, for instance, when asked how many of the 100 people living in their country in 2020 will be Muslim, people guess that it will be 40%, compared to the real rate of 8.3%.

At the other end of the spectrum, there are the bravura stories from both startups and established high-tech companies that talk about connecting the world, completely oblivious of distance, culture, language or currency. Well, the world isn’t that flat yet at all, as Thomas Friedman wanted us to believe. Just think of Facebook which despite Mark Zuckerberg’s admirable ability to converse in Chinese cannot officially be accessed on the Chinese mainland, soon to become the largest economy in the world. Neither can Google and LinkedIn.

Manage the World

And so it happened that globalization has become a toy for both anxious politicians who want to close their national borders, and ambitious businessmen who want to expand their ‘empires’. The question is: how much influence does one really have?

If we look at world trade over the last three centuries, we can see a curve of constant growth, accelerating rapidly in the twentieth century. The two world wars caused some stagnation but did not stop international trade. So it looks as if being against globalization is like denying the theory of evolution.

It is our human nature to trade and travel. Inventions such as the telephone, automobiles, aircraft and above all the Internet are the perfect tools to satisfy  urge to discover new frontiers and sources of wealth. Reversing the globalization trend would cause much more than an economic crisis.

Putting aside the plagues of tourism in cities and crowded airports and airplanes, even the most committed skeptics would have to admit that globalization has brought a lot of good stuff to a lot of people. Wealth has grown enormously in the world in the past decades and is much more evenly spread across nations. That said, globalization has contributed to a widening gap between rich and poor within many nations, and has made a serious assault on the world’s climate and our natural resources.

Managing the world is not easy. We can only wish that politicians start filtering out facts from fiction and fear. They need to realize that globalization cannot be stopped, but it can certainly be managed better. How?  By working together more effectively.

Manage the Business

When it comes to business, we - the translation industry - have both the responsibility and the means to help make globalization more successful. Pankaj Ghemawat, a professor at New York University’s Stern School of Business, is a master at unraveling the “globaloneys”. According to surveys he conducted in 2012, people tend to overestimate the intensity of global business. They think that the total exports of goods and services amount to 45% of GDP, where as the actual amount is 30%.

The “globaloney gap”, as he calls it, breeds complacency. Companies will take it easy, making little extra effort to create better products and services for cross-border markets. Ghemawat reckons we are still in a state of semi-globalization. There is a lot more work to be done before we can truly say that business is globalized. In the 2017 summer issue of Harvard Business Review he outlined the strategies that companies can follow to maximize their returns from globalization.

In essence there are three options.

  1. Companies can exploit the differences in labor costs and taxes and use globalization to reduce operational costs. This is the arbitrage strategy.
  2. Companies can also look for economies of scale by expanding their operations into global markets. This is the aggregation strategy.
  3. Or companies can boost their revenues and market share by tailoring products and services to suit local tastes and needs. This third option, the adaptation strategy, is the one that Ghemawat recommends most in a political environment that may become more protectionist.

And that is where the translation industry steps in: who else than the linguists and cultural experts can advise and help companies best with their adaptation strategies?

The Locamania Mission

8 The Long Tail-pink.jpgThis is the time for everyone with a function or a stake in the translation industry to be clear about their roles in the globalization strategies of their own and their client’s companies. It’s no longer business as usual, mechanically translating a text that needs translation. We need to step up and give strategic advice on how to adapt products and services, profile content, select media and channels, customize and personalize, use machine translation and machine learning technology, and measure productivity and quality.

But before we get there we have to battle a few “baloneys” of our own.

One is the idea that technology takes away jobs in the translation industry. Common Sense Advisory reports that the translation market almost doubled in size between 2009 and 2017 and will continue to show healthy growth of around 4% in the coming years. Jobs are changing for sure, but they are not going away.

A second myth is that localization costs too much. The World Trade Organization reports that world merchandise exports almost doubled between 2005 and 2014 to 19,000 Billion US dollars. Compare that to the 37 Billion spent on translation in 2014 and you see that spend on translation is as low as 0.2% of the total international trade in merchandise (not even including services).

We can surely do better and boost international sales provided we tailor our products and services to local flavors and cultures. It’s time for executives to think strategic about localization: it’s not the cost of doing business - it is the key to growth and optimization.

As we outlined in The Story of the Translation Industry in 22 there are many ways to optimize our business. We can be storytellers, datafiers, technologists, innovators, transcreators or continuous localizers. Whatever we focus on in our translation business and strategies, we need to display our passion of seeing the world through the interface of a country’s and a region’s local culture. Our challenge is to optimize the use of resources - technologies and human beings -  to make cross-border communications and sales work really well. The challenge is to exploit local differences, rather than trying to reduce them to a single flavorless, global standard. We need to be locamaniacs.


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