1. Project/ Open Technology Adoption and Competitive Advantage in the Translation Industry

2. Project/ Open Contents  What is Project/Open? –Project-ERP –What is Open-Source?  Competition in the Translation Industry –Sources –Arenas  Technology Adoption –Example: Translation Memories  New Technologies  Project/Open Modules

3. Project/ Open What is Project/Open?

4. Project/ Open What is Project/Open?  “Project-ERP”  Integration Solution for Translation Agencies  100% pure Internet  It’s mostly free software!  We earn our money with additional modules, installation and support Projects Users Clients Costs File Storage Work- flow Sales Trados Integra- tion Project Forum Freelance Database Invoicing Purchase Orders

5. Project/ Open What is Open-Source?  Everybody can use and copy open-source programs  “Science model”: Everybody contributes and shares  Mouth-to-mouth marketing  Development costs are much lower  Sales costs are much lower  Revenues from installation & support are sufficient

6. Project/ Open Competition in the Translation Industry

7. Project/ Open Translation Value Chain MLV Clients PMEditingSales StaffingQC Trans. Quality Man.  The “classical” MLV (Multi Language Vendor) uses a lot of freelancer (“Editing” and “Trans.”) to provide the service for his customers.  Only a few language resources (“QC”) are working in-house as staff. The “Classical” MLV Model

8. Project/ Open MLV SLV MLV Translation Value Chain Clients PMEditingSales StaffingQC Trans. Quality Man.  Larger or more sophisticated (localization) projects require specialized resources, so the MLV needs to subcontract to specialized SLVs  However, these SLVs are not allowed to communicate with the client directly, resulting in a huge overhead.  The “valued” contributed by MLV is limited to sales, QC and PM Subcontracting to SLVs

9. Project/ Open SLV MLV SLV MLV Translation Value Chain Clients PMEditingSales StaffingQC Trans. Quality Man.  As a result, MLVs get frequently bypassed or “disintermediated”  Customers start to work with sophisticated SLVs directly and save up to 40% Bypassing the MLV

10. Project/ Open SLV MLV SLV MLV Translation Value Chain Clients PMEditingSales StaffingQC Trans. Quality Man. MLV Defensive strategies  MLVs try to defend by “integrating upwards” towards the customer to create lock-in and by beefing up their sales force  Lionbridge’s losses have reduced since 2002…

11. Project/ Open  This feels like the California gold rush. Just make sure to sell tools and denims…  We are selling Translation Workflow… :-) SLV MLV SLV MLV Translation Value Chain Clients PMEditingSales StaffingQC Trans. Quality Man. Arenas Fighting Arenas

12. Project/ Open Arenas and Strategies Customer Integration -Learn -Improve-Learn Sales Staffing Project Management -Learn Quality Management “Production” Organization -Improve -Specialize on the language -Improve -Learn -Improve Small MLV SLVFreel. Large MLV Service -Learn -Extend/ Defend -Defend -Improve/ Defend -Defend -Improve/ Defend Arena

13. Project/ Open How to fight?  Best management practices in each area/department  IT tools Competitive „Weapons“ Strategic Operational Efficiency  Specialization  Languages  subject area  industry sector, ...  Size ...

14. Project/ Open Example: TM-Adoption

15. Project/ Open TM-Adoption Benefit  Very useful (saves 20%- 50% of the work) Driving Force  Intense Competition, particularly after the advent of the Internet Why did adoption take so long?  Translators are normally not very tech-savvy.  TMs became easy to use only with the appearance of Windows/ Mac OS Figures from LISA 2002 TM Survey Interpolations 2005 0% 20% 40% 60% 80% 100% 199019952000 Competitive Advantage for Early Majority Companies that replied to the LISA 2002 TM Survey

16. Project/ Open Types of Adopters Source: Everett Rogers, “Diffusion of Innovations”, 1962 0% 20% 40% 60% 80% 1990199520002005 100% Late Majority Laggards Early Majority Early Adopters 1990199520002005  Innovators (“Techies”) –Appreciate technology for its own sake  Early Adopters („Visionaries“) –Will accept an 80% solution  Early Majority („Pragmatists“) –Want a complete solution –Want to see it working  Late Majority (“Conservatives”) –Focus on who else is doing it –Emphasize maturity of the technology  Laggards (“Skeptics”) Innovators

17. Project/ Open Technology Portfolio 1995200020052010 0% 20% 40% 60% 80% 100% 19801990 Translation Memories 1985 Email in Translation Companies Fax in Translation Companies Qualitative curves for Fax and Email adoption

18. Project/ Open New Technologies

19. Project/ Open Translation IT Trends Problem  Clumsy handling of files  Communication in large project teams  Hassle to manage TMs  What is quality???  Price pressure, complex freelance market  Long PM telephone calls with freelancers Solution  Extranets for file download/ upload (FTP-Servers, Web- Access, …)  Project Collaboration  Distributed TM  Quality Management/ Database  Integrated Freelance/ Provider Databases (across offices, integrated with Quality DB)  Freelance Self Service

20. Project/ Open Technology Portfolio 1995200020052010 0% 20% 40% 60% 80% 100% 19801990 Translation Memories 1985 Email in Translation Companies Fax in Translation Companies Qualitative curves for Fax and Email Project-ERP Distributed TM?

21. Project/ Open Jochen Hummel (Trados) „For the next wave of innovation, however, the key ingredient is what we at TRADOS are calling “collaborative workflow.” 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." "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 TradosTrados Source: Client Side News 08.03

22. Project/ Open MLV SLV MLV SLV Translation Value Chain Clients PMEditingSales StaffingQC Trans. Quality Man.

23. Project/ Open Optimization Potential  The analysis of the optimization potential has lead us to the modules of Project/Open  The introduction of IT-tools is frequently meant to improve best- practices as well. 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 Customer Integration Sales Staffing Project Management Quality Management “Production” Organization Service -Integrated Workflows -Multilingual CMS -Custom Apps. -Sales force automation -CRM -Data Warehouse -Integrated freelance databases -Quality database, integrated with freelance database -Translation Workflow -Semiautomatic PM -Balanced Scorecard -Internet Project Collaboration -Intranets/ Extranets -Service Mgmt. -CRM -Scorecards

24. Project/ Open Conclusion  Know in what arenas you are playing  Focus on a single area at a time  Choose your weapons  Don’t chose the wrong ones! Frank Bergmann frank.bergmann@project-open.com www.project-open.com Project/ Open