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The Future of Language Technology: Evaluating a Multivendor Strategy

When companies should embrace a multivendor strategy or opt for a single vendor strategy and why

Last updated: September 16, 2020 3:00AM

This is the first part in The Future of Language Technology Series, which explores the changes of language delivery as a result of technological developments.

Remember when we relied on overly manual processes to execute our translations? This obsolete practice is a testament to the speed at which the language industry is moving and why it’s important to take a step back every so often to reassess your language strategy. Can you imagine yourself using old localization practices at a time when we are flooded with content? We consume, create and transform more content now than ever before. Sure, it’s hard to pause when you’re moving at the speed of light. But it may be well worth your time and effort to plan for the future.

In the COVID-19 world, companies are accelerating their digital transformation and challenging the way they think about localization and content. Their mindset is shifting. They are thinking about the content lifecycle, the ROI on content and the content time to market, which moves the focus from process to outcomes. This is prompting companies to consider different approaches to their localization programs and to question their multivendor strategies.

What Is a Multivendor Strategy and Why Is It Used? 

A multivendor strategy occurs when a company utilizes multiple Language Service Providers (LSPs) to provide localization services. Companies typically go this route when they want to reduce risk to their localization programs. They’ll often rely on three, four or more vendors to localize their content. They might choose to diversify their vendors based on languages, regions or the of type of content that is being localized. 

A multivendor approach dates back in time to when localization projects were large and the connectivity between content management systems and localization systems was poor. It was used to reduce the risk of delays in getting content to target markets.

Over the last decade, the role of content has changed considerably as the digital economy has made content a crucial part of marketing. The way companies manage content has fundamentally changed as well. Together, these things have impacted the way we think about content lifecycles.

Advancements have reduced the complexity associated with the localization process. Many content management systems have added native support for media-rich content types and because they are now more sophisticated and offer solutions to manage the full content lifecycle, they are reducing the need for a multivendor strategy in certain cases.

What Are the Advantages of a Multivendor Approach?

Companies use a multivendor approach because it allows them to achieve a variety of goals, and they can:

Reduce risk by diversification–Diversifying the content localization spend across multiple LSPs or translation agencies helps companies better deal with a peak demand for translation and localization services across multiple local marketing teams.
Better leverage the local expertise of smaller companies–By embracing a multivendor strategy, companies leverage the local expertise of single language vendors that are in market. They do this to achieve high quality, authentic translations.
Gain cost efficiencies–Going multivendor helps companies keep multiple suppliers in check. It also dynamically allocates work across different vendor services to achieve cost efficiencies across content types and languages.

What Are the Disadvantages of a Multivendor Strategy?

Administering a multivendor strategy is costly and often results in a major financial investment. Companies tend to purchase expensive software to help them manage vendors. They must then devote internal resources to operate and maintain what’s called a Translation Management System (TMS).

We estimate that most of the companies pursuing a multivendor strategy devote as much as 20% of their localization budget to maintain their multivendor strategy. Management and associated technology costs can add up to hundreds of thousands of dollars. 

The black and white photo shows a geometric pattern of line segments over a close-up shot of hands holding a technological device. The photo suggests technological advances and represents the evaluation of a multivendor strategy.

Who Should and Should Not Embrace a Multivendor Strategy? 

A multivendor strategy is suitable for a large localization program where scale can overwhelm agencies or mid-sized LSPs.

Generally, a multivendor strategy is not advised for companies with tight localization budgets. That’s because the total overhead cost that is required to manage multiple vendors would eat into their overall localization spend. As a result, they would have fewer resources to devote to localization, which would ultimately reduce the impact their content is making in their target markets.

When Is It Best To Partner With a Single LSP? 

You don’t need to have a multivendor strategy to achieve high quality localizations in a timely manner. For many companies, it’s more advantageous to work with a single LSP.

Partnering with a single LSP for your localization programs is a good choice if you want a strong localization partner to handle all the complexity for you. A single LSP can achieve economies of scale and significantly reduce the amount of overhead involved in managing multiple partners.

Whatever your choice may be, consider looking at your return on investment on any technology you would need to implement in order to execute your translations and compare it to your total localization budget. 

Some LSPs, like Lionbridge, bundle localization technology into their offering so you don’t need to worry about it at all. This results in significant cost savings and the ability to use more of your localization budget towards localizing content and making your translations more impactful in your target markets. 

Learn more about Lionbridge’s CMS integration solution by downloading our e-book. 