S03E05: Outcomes-Based Language Solutions Delivery

Nic McMahon

Thank you, thanks for having me, Sultan.

 

Sultan Ghaznawi

Thank you for making time to speak with me today, Nic. Please give some background about yourself and what you do.

 

Nic McMahon

Yeah. So, I I’ve been in the localization industry for about 25 years, and then, you know, in terms of background, you know, I started off as a junior project manager and back in the day I came into the industry by accident. Maybe we’ll pick up on that, like a little bit later, but it’s you know I I was looking for a project manager job and I got a project manager job in the language industry and then I saw went through you know, affectively all functions. I’ve been an account manager and I went to sales, the dark side, and I was a business development manager and I’ve been a director and an operational director of a CEO, and I’ve worked you know I’ve had the luck to have opportunities to work in RWS through SDL, and it was SDL when, when, when I was there. And also, Lionbridge and then some smaller scale companies Via and Jonckers.

 

So, I’ve heard that you know a lot of different ranges within the industry and a lot of different organizations within the industry. And typically I’ve been at those companies you know, for five or six years, right? It’s maybe a bit longer I guess overall, but but it’s enough time to, really, you know, understand the companies and the challenges that they’re facing and and certainly enough time to sort of realize whether the solutions and the things we’re trying to do, you know, really effectively work and provide value. So, you know I I like to think you know that I’ve got a fairly, you know, broad and fairly unique view of the industry. And it certainly doesn’t you know, the uniqueness does not make it the most valuable view, but I do think I’ve got a fairly unique view of the industry in terms of touching so many functions, so many companies and then so many different scales.

 

Sultan Ghaznawi

That’s quite interesting Nic, how did your journey in in this industry in localization industry start tell me, was it an accident or is it something that was planned?

 

Nic McMahon

Yeah, it’s a weird thing Sultan. I’m looking at what your story is. But it’s a weird thing that I… a lot of people I’ve spoken to, it is sort of accidental, right? You know when I was you know I always had this sort of thing like nobody went there so like you know, the proverbial stereotypical sort of 6-year-old boys, or says, like, oh, I really want to get into the language industry when I’m older. And so, you know ultimately, I was a project manager and that’s you know it’s sort of done a little bit you know it was honestly relatively fresh out college. Then a couple of years in project management and then I was looking for a project manager job and one became available in uh, in a small local company called SDL, and at that time they were a pretty small local company. And I just went there for a project management job and I didn’t really know much about language. I didn’t really know, you know there was a… there was a whole industry but like many of us it’s been a very compelling industry. So, I got into it by accident but 25 years later you can’t say I can’t really claim to have stayed in it by accident. At this at this point is it’s turned into a plan and strategy.

 

Sultan Ghaznawi

So, so let’s talk about that, Nic. Tell me about what you have observed over the years that stood out for you in this industry.

 

Nic McMahon

Yeah, as you say, like in a number of different things you know ultimately, you know, given the longevity within the industry, but like I, I think one thing that’s overriding which you know, I guess it’s the English in me, ultimately it feels like a bit of a negative reflection, but it’s we’re an undervalued industry and I don’t, I don’t think it’s just about what we do or the individuals in it or anything like that, but I think it’s an industry. We haven’t captured the full value of what we do, and you know I think there’s a good opportunity for us to dig into some of that later, but it’s… but I think that’s one thing you know it’s an interim remarkable people of capable people of… people with you know… unique insights and industrial awareness and understanding, it is an industry of multi-skilled uh, you know deeply experienced resources where they have to have linguistic degrees you know, and you know broad industry knowledge. And so, you know it’s a… it’s a fascinating industry. So there are a lot of things that really stuck out to me in a very positive sense. But one of my overwhelming things is… that it’s an industry where we fail to truly capture the value that all those other awesome things should have yielded.

 

Sultan Ghaznawi

So, let’s talk  about that… about the value, what we do as translation companies. Our conversation will revolve around the topic of creating value in our companies. Please breakdown what a translation company does and how does it benefit clients.

 

Nic McMahon

Yeah, and I think it’s interesting right at an industrial level like a language company when you think about a typical LSP, an LSP is an equivalency to a logistics company, so it’s not so much we provide a product, we get a product from A to B. We deliver a product, you know as you have awareness, right? Most of the large scale LSP’s have very limited internal linguistic capacity, right? Whether it’s translation, or interpretation and we you know in terms of our employees we have very relatively little actual, you know, production capacity in terms of the raw product, the translation so effectively what it means is we’re a logistics company, and but I think often when we look to you know develop our value, we look back into the product and so you know I like and it’s like let’s say we were, you know, we’re a logistics company in, you know a metals commodity market, right? You know we may deliver gold, or we may deliver tin, but we start to attribute our value to that gold and to that tin. But, but we’re really the delivery mechanism for that gold, and that tin and our value has to come from that delivery mechanism, not from the innate product itself.

 

Sultan Ghaznawi

As they say, beauty is in the eye of the beholder. I think value is similar as perceived by clients. What do customers perceive about the type of value that language companies deliver to them?

 

Nic McMahon

Yeah, so I think that you know as an industrial issue on the customer side they have a similar issue where they perceive the value of the product that is delivered and they sort of get confused or there can be confusion between partner and client in terms of you know what the actual you know what the product that’s being valued is so, so we give French, and then somebody might come back to us and say, oh your French manufacturing controls translation sucks, but effectively we delivered a manufacturing controls translation, but it’s not ours, you know we delivered it from a source from a professional who provided that product and so you know when customers and you still think that OK when a customer looks in LSP or language provider, they’re actually looking both sometimes that you are a logistical provider, so are you on time, are you efficient and are you highly communicative? Then other times they might look and say, you know, but did you deliver gold, or did you deliver tin, right? That they’re looking at the actual product and not judging by the nature of the product that you delivered.

 

Now as we sold de-weed, you know I always think about problems and industrial scale problems is like, uh, not you know like a knotted piece of string and if you just start blanking on any piece of a string, it doesn’t become unknotted, it gets more knotted. And so, when we think about this value prop the concept of this overlapping perception of value between you know the actual product, the translated word and the logistical delivery of that product I think that’s part of why we get into trouble in terms of perceived value and like whether or not they understand and sort of really see the value that we deliver. But if we clarify those roles and clarify that responsibility and then we focus on our ability to drive value through the, you know through the logistical supply chain of view of what an LSP does I think we can make tremendous progress and actually I think that also then helps provide clarity around the actual producer of the product, the linguist and the interpreter so that they can also provide that. So, I think if we really want to get rid of this knot, we’ve got to pull out those strings a little bit and we’ve got to have the concept between what is a… the delivery of the product and what is the logistics of delivery of the product and then that allows us to create much clearer value statements.

 

Sultan Ghaznawi

So, on that note, I mean there’s this debate about whether we create value or we transform it. My good friend Renato Beninatto, he’s an industry pundit. He knows everything that happens in this industry, and he wrote a book on how translation companies operate. He insists that we are in the business of value transformation because we don’t create anything, we only take the created content and transform it. I’m interested to hear from you, Nic, about how do we create value. What are your thoughts?

 

Nic McMahon

Yeah, it’s interesting, I know Renato pretty well and you know, he, he’s got an extremely valid view on the industry, but I actually think when he talks about this concept of transformation in many ways, he’s doing a very similar thing where he’s conflating like both of these issues, or putting both of these issues together, because we’re not trying to convert the value of tin like the actual core product or the value of gold, the actual product from the linguist over to some other value for customer. You know because that that creates this confusion where what we’re trying to do is actually develop value for what it is we really do deliver. Because I see you know, over I sort of give. you know, tin, you know, let’s say somebody really wants a basic level translation, it’s very valuable, right? If I want cans, I want the made of tin like it’s the right material. And if I deliver tin that I tried to turn that tin into, you know, transform it into gold formula, or this is the best translation ever and this is such an insightful translation and it’s such an in depth but that’s a basic commodity translation like a user guide, I don’t want the same linguistic skill that I might need in a movie, right? And so, when I’m creating value, it’s not about me transforming tin to gold, taking something from a linguist, and upscaling the value of that thing.

 

For me, for the LSP I’ve gotta make sure that I’m delivering the right quality product to the right business solution and then developing value in that business solution so I don’t so see transformation I feel like we’re not alchemist, we can’t turn something into something else, and I think the way for us to develop value is by outcome security. Like we can make sure that the intended purpose and application of the product we deliver is actually achieved. So that, so when I work with the client, what we’re trying to do is what are you really trying to achieve here? What is it you’re really trying to do? And then we make sure we’re mapping that right skill to that right outcome. And the better we do that, the better we drive value for us because we become more valuable and the better, we also drive value for the linguists, the highly trained linguists, because they’re getting the full value out of the work that they do.

 

Sultan Ghaznawi

So, if I understand you correctly and you show outcomes to clients for example in case of ULG under your, you know, leadership… you can show to a client that if you localize an e-learning course, the value is that now you have a much larger audience outside an English-speaking market. Is that what I’m trying to… what you’re trying to communicate here?

 

Nic McMahon

Yeah, 100%. Because effectively like resolving OK, we’re going to like push towards this outcome thing the I say OK I want a translated course, right? Then that course goes out, somebody comes back and said that’s a rubbish course, if my prime review as well as peers that I’m providing translation of a course the issue is I’m going to get you better translation to overcome the idea that you didn’t like that course, but now I’m trying to turn tin into gold, right? In this case, actually course translation is more like gold, right? Or silver at least, right? It’s a high-quality endeavor. So here there, there is a value to that right? So, but the but what I’ve got to do is not so much translate that course, that’s not what makes the course successful. What makes it cause successful, is it engaging, and does it drive learning outcomes, so at the end of the course, the learner knows what the learner was supposed to retain from the course content. So now if I shift my view and say OK, I’m about logistically supplying you with the right outcome. I’m about getting the product the right product for you to get to the right outcome now.

 

What I want to do is convert that conversation around the translation of the course as if that was going to get me the right outcome to the engagement of the course, so I want to ask a question like hey, is this course engaging to begin with? Hey, is this method of learning the appropriate learning method for that target market? Because then once I start to, you know talk about what is the right learning method for the target market and the right engagement method for the target market. I can then go to the linguist and connect them much more closely to a course that’s likely to be successful, and if that course is successful, it has value, right? If that course is not successful, it doesn’t have value, and I’m going to keep trying to get a different translator. But if that course is successful and is driving value because it’s achieving engagement and meaningful retention of that data and to the to the end target audience, then everybody wants that course to be successful and I’m more likely to pay a higher price and invest greater in training and support of that linguistic resource to get that engagement outcome because it is what I’m trying to achieve with the course

 

Sultan Ghaznawi

I think it’s difficult to define the value of any service and we are in a certain knowledge service industry so yeah well have you found basically a way to clearly communicate that using outcomes. Of course I mean, is there a formula because even though we, you and I were talking it’s I find it difficult that you and I are communicating about value.

 

Nic McMahon

So, like what we look for is there’s no like a five-step process, right? We refer to like a language solutions maturity model and that’s what we try to you know, follow with our customers. So first of all, it’s like a basic map of services, right? And that’s a little bit more about what we talk about when we talk about service delivery, right? First of all is that are we getting it to you on time and is it getting to you in a fashion that you need it to fulfil the needs of, let’s say this theoretical e-learning course, right? So that’s just that, like they’re getting fast enough, are you getting on time? Are we communicating well enough? It’s basic mapping your course to make sure that the delivery is working in a way that the customer in the end you would need. Then we start thinking about OK, how do we integrate technology? But that’s really about making it seamlessly there. Then we start to get into this outcome thing, and we say OK, what is the actual outcome? What are the right mechanisms for outcomes? So, if we talk about course, we start OK, like do we have the availability to get course completion rates and course engagement statistics?

 

And then rather than like let’s say translation quality statistics, can you share with us, you know, the amount of engagement that was generated from the course? How many people took it how long they spend within the course? And then, how many people completed that course and went on to complete other courses? So now we start to move the performance as from an LSP provider. Our discussion starts coming, hey is this course performing against the outcome? So, when they come back and say, you know what people aren’t spending long enough on this course, we say, well, let’s look at the content within the translated course and make sure that that content within the translated course is compelling. If we say if we don’t make that connection to the engagement then the other outcomes, oh people didn’t like the course, the translation quality is rubbish, give us better translation quality. But you know as well as I do better translation quality is highly subjective, no one talking about spelling mistakes we’re talking about voice tone and style, right?

 

And so that’s highly subjective. So, when we start to work on this model of move to outcome, es, there’s a basic mapping of service. Yes, you should look to integrate technology like MT or AI, or you know whatever, you know API connectivity, but then you’ve got to start to discuss with your clients and target market you know what the intended outcome is and start to build KPIs around that outcome. And then move your discussions to like are we getting the intended outcome from our piece of material? And then if not, we’ll do a repetitive feedback loop to get you that outcome. So, we pulled out some videos in this course where, did that improve engagement and retention? And we added some videos to this course where, did that improve engagement and retention? All the time, we keep in the conversation, not in translation quality, but engagement and retention and that’s because in this example, that is the outcome KPI.

 

Sultan Ghaznawi

And that’s actually a very interesting point you just raised, Nic. Because from the sounds of it, if we can demonstrate how our… the value that we create helps with the bottom line of our clients’ business, then they will see the value. For example, if we can tell them that the because of the translation, your churn rate for your clients in your telecom company you know drop by this percent, I think that’s how we demonstrate it, but talking about value and how we demonstrate it to our clients, I know, you touched upon this. But the role of a translation company in the content value chain has evolved significantly over the past few years and in many ways including becoming an abstract plugin for MT engines, people basically see us as a data point for multilingual content, or to getting highly involved with marketing content and so on. How do you suggest, Nic, we demonstrate that value the changing value to clients?

 

Nic McMahon

Yeah, I think in many ways like the way you can do it is by showing you know it is it’s picking up wherever it is our, you know focus within market but it’s picking up the outcome dialogue right? And so, you know if we start think about, you know, where we use MT, we used MT to eliminate you know translation of the low value. There was bulk translation that nobody was really paying a lot of attention with, and the client didn’t really want to spend a bunch of time on it and so we MT that content so that then you know they don’t need to, you know, the cost for them is significantly low. Now that does take words out of the industry and so somebody could be like, well, hold on a minute like now there’s you know there’s not 100,000 words for me to translate, but problem was that translator couldn’t use the value from that content.

 

Now if the customer can translate those words much, much cheaper then they can take the money that they were so effectively wasting, right, and the effort that they were paying for, which was effectively wasted to put a high-quality resource on a low value piece of content and they can start to then focus that money and those resource time and into high value content, right? So, I can start saying like OK instead of me worrying about the cost of translation, maybe I can sort work out what is the actual usage and demand a content demand in that country? So maybe I take that highly trained linguist and start to focus them purely on high value content but when I can’t get the low value content translated lined up using a translator on low value content, it becomes highly frustrating because the linguist is frustrated you won’t pay more. The client is frustrated they’re paying as much as they are, but the reason is it’s a high value resource on low value content, and MT and this sort of tradition this this moves to what’s the actual outcome, what are you actually trying to achieve, allows you to start filtering the right type of resource to the right type of work now.

 

In another example, we have medical claims we start to use AI and NMT to filter the medical claims… a function. So, what was previously all translation, it was 127 bucks to translate the average medical claim. Because of the size and number of words, right? Just standard translation work, this many words, this many pages, this cost… the problem was that it was that thing where it’s like they needed it cheaper and they needed it faster and for the majority of it, nobody was reading it to be like hey, was this really a well translated medical claim? Conversely, some of the medical claims needed more in-depth medical understanding to really extract the right types of terms and the right type of phrases so that those people got paid for their claims, but what they were doing was running everything through translation. It was costing a fortune so then they start to get like without pull back the amount of translation we do then claims start to back up, then then what’s called CMS ratings or medical support ratings you know started to get impacted because they just weren’t processing enough claims.

 

When we took a step back and said OK, what’s the actual outcome, what are you trying to do? And they’re like we’re trying to process as many claims and get CMS ratings and then support members in the best way. We realized that we didn’t need to human translate a vast majority of that content, we could auto prop a bunch of the content through NMT, use AI to look for these claims that were higher value and higher complexity and then route those higher value and complexity claims to a linguist that that they were willing to pay for because they were only working out on a significantly reduced volume of claims. So now I have a translator that’s getting paid effectively for high value work on high value content that yields a result the customer is happy with. And I have an AI, NMT deployment that is, you know providing a cost-effective solution for what is effectively data extraction, but we didn’t we didn’t really ever need to translate. So, it it’s a mechanism that allows us to, you know, by focusing on what is the net outcome we can get the right resources to the right type of project, and then once you get the right resources on the right project, everybody can extract value.

 

Sultan Ghaznawi

Nic, I have asked this question before from people who have been on this podcast, but I’m going to ask you as well what problem are we actually solving with translation? The people whose problems are solved, do they even realize or know and acknowledge the type of the type and amount of effort that goes on behind the scenes? For example, we deploy translators, editors, there’s like engineers who deal with all types of different, you know formatting issues and so forth. Does that get noticed because all of that is obviously goes into creating value.

 

Nic McMahon

Yeah, and this the challenging factor, and I say this in a very personal level because like I’ve been in this industry for a very long time, and I’ve done a number of these different functions, the sad fact is it’s not, you know, just as a customer understand the value. It’s like we as an industry, have wasted a tremendous amount of effort and it’s really you know challenging fact for me. You know I’ve spent a lot of my life wasting a tremendous amount of effort because I’m trying to uphold this high value, you know, high value resource, low value outcome. And the answer is no, they don’t the customer does not understand nor will they ever understand the amount of effort that goes into producing, because even if they did understand it, there is no that effort is effectively wasted because it’s a high value production on a low value piece of content and what we as an industry have to do especially now I think what has really unlocked this opportunity is the NMT stuff is we’ve got to start to work out more internally, let’s separate out the value because if you, if a customer has doubts about what it takes and the quality of work that’s going into it, it’s a very good sign that you’re working on something that is a lower end value statement.

 

But you can ask somebody like, hey, you know, do we really appreciate that translator that translated our marketing materials and helped us expand our market. They appreciate the value, and they will pay for it. They pay higher rates and they’re more grateful for it. If you say hey, you know, do you really appreciate this person? We got to translate a thing on SlatorCon couple days ago or yesterday, you know, like Deluxe Entertainment, they translate movies, they appreciate the value they get paid for it so if you find the outcome and you link the right resource to it, we can all stop wasting this effort and putting all this tremendous high quality work into this ultimately low value output and we can start to align people to tasks and roles and deliverables that make a much bigger difference to their customers, and in turn, the customers are willing to pay you know the right rate for those type of services.

 

Sultan Ghaznawi

So Nic, speaking of demonstrating value again, language companies, you know they’ve become critical for so many industries and businesses today, whether they want to sell globally or train their international staff, how do they decide, I mean the clients, which translation vendor delivers more or better value to them beyond reducing their cost because in some cases cost is not their number one priority.

 

Nic McMahon

Yeah, for sure. Cost is evolving. It’s like… the biggest cost savings I’ve ever achieved through strategic partnerships like is, you know, like this concept that you reduce costs by getting two cents off is really like is that all that is like a 101 centralized procurement strategy. Like it’s, you know, like a big company knows if they get their thumb screws out and goes to a small vendor and say give us a discount, that vendor especially, if there’s no communication within the industry, will give him a 2 cents discount. But you never save money in that way, like it’s like it’s a tiny proportion of the overall savings and you know as well as I do, vendors get very good at countermanding that by putting in extra lines in a PO or extra service rates or reducing the you know the throughput volumes like it’s is a net sum game and it’s literally just a 101 procurement game like, you know, we’ll get people comes online like you gotta drop our rates.

 

We’ve got to a point in maturity with outcomes where we’re like, not like just, not like we’re not going to have the discussion and we’re not going to go through it because we are highly confident of this strategic reduction in long term costs that we create by partnering with you on intelligent solutions to your problem and so, you know, effectively you know when we think about you know how they decide their value, their vendors, it’s not the 101 procurement thing like that’s just a trick that. They use and because we are not communitive and, uh, communicative marketplace, and we’re not mature marketplace. The 101 vendor thumbscrew works really well so everybody should just stop playing 101 vendor thumbscrew games with the logical entities, get a little bit more confident about the value they actually drive, get a little bit better about the way that they position and relate that value back. And that problem would go now.

 

You’re still going to be left with who do they pick and why do they pick people but they pick people you know within large scale global enterprises for the same reason you pick people when you decide any vendor that you work with, they want vendors that truly understand what they’re trying to achieve, truly partner with them to achieve that goal and then show measurable results to the delivery of that goal. Now to put in context, we work with a vendor right now they get their thumb screws out, give us two cents off a word and like no, you’re not getting a discount. That same vendor we’ve worked with the actual people that do production to save them hundreds of thousands of dollars a year and through intelligent deployment of the right resources on the right content. Now that vendor you know procurement comes online and they’re like, oh we’re gonna kick you out ’cause we’ve got 30,000 vendors to choose from, and like I don’t know I I’d be worried about you if I was you guys and you know, yeah, they might want to use you, but like you don’t understand like we control it and it’s literally one on one procurement strategy from a large global entity.

 

The actual person that makes that decision is the person that you’ve built… you’ve built a trusted supplier relationship with, and that person has the power to override central procurement, and they do so, you know, if you want to drive value, you know with your… with your… with your customers provide meaningful solutions connected to their outcome and then trust that that meaningful solution connected to their outcome will actually protect and allow you to grow within that client and then when procurement turns up, if you’re dealing with a global scale enterprise where a lot of our customers are and they turn up with their thumbscrews, you’ve got to be more mature. But if a global procurement agency says to me, yeah, I’ll give you $5 million worth of more business I’ll give them a discount, but if they’re not going to give me anymore when I take that discount and I fool for you know, baseline error, it’s not lack of value that’s an entirely separate conversation. I’m… it’s a lack of experience dealing with global entities and what I do in accepting that disk now is condemn the whole rest of the industry to a price war.

Sultan Ghaznawi

So, while we’re still talking about prices and costs, like in terms of value, we’re at a time in history where things are changing. I mean both politically and economically as well, if you look, inflation is everywhere, but in our industry, it’s expected that prices should drop, I don’t know why do you think it is a time as an industry we can go to a client industries and demonstrate that the costs are going up. Maybe we can increase our prices somehow, because now that’s expected and accepted in so many different ways.

 

Nic McMahon

Yep for sure and then I I’ve pitched to, you know, a couple of other CEO’s that we should create a visible commodity index where we just also like yeah, you know at the end of the day you know there is a known price for a professional quality product like there’s a known price because like the interesting thing is actually from a CEO of an LSP is I’m constantly told that all the other LSP’s undercut pricing, but I’ve worked in enough LSPs to know that when I was at Lionbridge, SDL undercut pricing. When I went to Lion… when I went to SDL, I was told that like you know the other under curb pricing and the problem, it is just a lack of experience in industrial level, lack of visibility in that level. In terms of what’s actually happening in the marketplace, I believe we should create clear visibility to an average commodity price, just like there is in the gold market.

 

You know what an ounce of gold cost, everybody knows what an ounce of gold cost, you can sell it for whatever you like, you know, what the baseline market cost is, and that would limit this this scale of lack of experience, uh, competition in a highly fragmented market because they don’t really would have a baseline to go off and then if somebody comes and said that OK, well I’m gonna sell you this bar of gold for half of the price of the going rate, everybody could be like ask yourself, are you going to get the same product like half the price so I think we should we should get a commodity index, I think it would help a lot we should get all of the core services of language, we should publish out, you know, costs.

 

I’d be happy to work with Nimdzi or Slator or something like that. You know, give our prices into them so they can see all of our price lists, they can create the standard price list and they can publish it once a year, once every six months, so that everybody knows those, this is baseline costs. Returning, then you’re using that as a vehicle to return to your initial question this as an industry we absolutely can go back to customers and say hey we gotta put our costs up inflation is a very real thing. The quality of service that we drive is a very real thing and we should put our costs up. Now to return to my analogy of value, the problem is if I’m using a high-quality resource for a low quality or low value piece of content and then I say I’m going to put that that cost up from a business perspective, I’m literally going to say no because the content has doesn’t align to the value of the resource is doing it.

 

So, let’s say I have a gold can right, you know like a can we put fruit in or you put food in a, you know, like a can of beans, and instead of making that can of beans and make it out gold, you might like a gold can of beans into like that’s kind of fancy, like gold can of beans. That’s really great, right? I say you know what I’m gonna charge you, ten bucks for that instead of fifty cents. You are going to say like no so… you can only put value up where you have value. So, I think, uh, primary step here when we think about, you know language solutions majority, you must establish value by applying the right type of resource to the right type of problem. Once you do that, the concept that you would then go back to that thing that drives value and say this is costing more.

 

We absolutely should do it. But absolutely, we should be growing and expanding the opportunity of our market like Accenture doesn’t think about saying that their people are more valuable, like lawyers don’t think oh, I gotta cut the price my legal staff again this year. It’s a ridiculous state so, you know we do, we’re happy to go back to customers but there’s got to be… there’s you can only go back to the customer when you’re driving value and, but I think a lot of the industry we haven’t really secured that we’ve driven value. And then when you ask for more money for something that doesn’t have value, your… the answer is going to be no, so you gotta get value first by aligning to outcomes then you can ask for more money.

 

Sultan Ghaznawi

That is a very wise, wise way of presenting it, and I’m really glad we are on the same page.

 

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Sultan Ghaznawi

Nic, you mentioned that when you were in different LSPs they all had similar fears and so forth, but let’s compare them. If you go through the websites of, let’s say, 100 translation companies of all sizes, almost 90% of them or 90 of out of 100 will say the same thing on their websites. They try to justify selling quality as a value. I want to know what’s wrong with that. How can we differentiate our value creation and delivery from each other to create that distinction when we make up the translation of you know the translation companies, they are so homogeneous when their make-up is so homogeneous.

 

Nic McMahon

Yeah, because I think you know, it’s tricky, right? Because we, we and it’s reasonable like we talk around the same point and the problem is I am conscious, I always return back to my anchor, right? To my core point, but effectively you know what, when you go to LSP websites, we should talk about the solution and the problem that they solve for their customers. So, you know we talk about you know we reduced you know the this… that we increase the speed of medical claim turnarounds, right? We increase the amount medical claims that could be processed within the same budgetary figure, right, and not by eliminating valuable linguists, but by making sure we were using linguist in the right place and machine translation in the right place and so you know we should… as an industry right we should be going to each other’s websites and we should be doing more and more and more to publish what was the actual solution and the actual end result that you achieved with that client, right?

 

So, we helped to get 23 percent greater adoption and completion rates for health risk assessment surveys within the target market in New York and in LA. So, you know it’s not… we provide a translation quality. It’s like we got 23% more people to complete health risk assessments which increase the visibility and understanding of health risk for targeted disparity markets. And the more we as an industry can talk about the outcome that we created you know the more people could start to look at us as vendors and sort of work out OK what’s really the right vendor to work with because you want to align something that seems to be able to create the type of outcomes that you are trying to achieve, right? If I want to engage an audience who can help me engage an audience. If I want to just, you know, produce, you know four million words of translated text who can… who can help me produce mass volume of text at a very cost-effective price? You know, what’s my goal? And then I go to the websites and try to work out OK who could really help me get to my goal.

 

Sultan Ghaznawi

Nic, I think definition of value starts at the top as you just mentioned. It starts with leadership. How should language company leadership define value and their vision and mission statements?

 

Nic McMahon

It’s interesting, actually so, so for me, there’s a, there’s a break in the line of questioning if you like and it’s when I think about how do I define value for my company, right? There is a concept of how we divide value in the marketplace, and we do go to the marketplace and sort of say like you know it is… it for us… it’s about outcomes like we work very hard with you with our customers to work out what they’re really trying to achieve. And then we will re-map, redevelop, reintegrate anything we have to do to achieve that outcome. So, so we’re like we’re going to come to it, and then we’re gonna have to work out OK what are you really trying to achieve here? And then we will remap and rework out the right type of services to achieve that goal and so you know that’s how we push value. What triggers to me from the question when I think about how do I push value from a company perspective. You know what companies should be doing to push value is recognizing there are people.

 

Every single dollar of every single company is value comes from their people and as a company. If you’re if you’re focused on delivering value from, you know as a company to your, you know, what do I do for ULG is our value comes from our people. You know, when we externalize it, we talk about outcomes, but those outcomes are only possible based on quality and support and empowerment with our people. And so, when I think about you know value in ULG and what is valuable to ULG is it is our people and that you know, I live, breathe, eat… you know, trying to reflect the value of our p people, I think… you know, I think that’s where all value comes from.

 

 

Sultan Ghaznawi

So, equally importantly, is communicating the importance of value to all the people. Because at the end of the area in the organization is formed from people as you just mentioned. How should staff across different departments learn about the value that they collectively create or transform for that better term?

 

Nic McMahon

Yeah, there are two elements like so for us like what one is like you connect them to the outcome too, right? So, like when we increase health risk assessment, adoption and then that has a meaningful impact on reducing disparity that is a very motivating you know component right? You can probably see it is easier to touch, right? Because I’ve improved health outcomes of a target under service in an inequitable healthcare market, right? And that’s made people healthier, and it’s made people better and they get better quality outcomes. So, we connect our teams you know in our LinkedIn posts or our internal messaging, you know two of those outcomes because it’s very tangible. It shows what worth is, but I will also say that when we improve, you know workflow you know automation or we, you know intelligently apply machine translation and they can see that they’ve driven, you know, an average cost of word from 22 cents down to a… you know a customer.

 

They find a very high degree of value in that because the value of what they did and the work they did is clearly expressed in terms of the outcome that it achieved for the client. So it’s easier emotionally to see the human impact of healthcare, but on a professional level, I think many people are just committed to the idea that what they do is worthwhile and achieves useful results, and I think companies often, you know, forget that part to like try to draw those links to what was actually achieved and they don’t publish it because you know, go on to the next project, but I think you know, like one is reflecting that to people to make it clear that what they do produces what outcome. And then giving them visibility to the outcome so there is a closure look.

 

And it was something we had pain with. Like we weren’t doing either, so I don’t want to be like we are perfect, we’re not, but it’s something we’ve worked on to close that loop so people understand what was the outcome of their projects, and I think that that helps drive their you know, value to them, and then from a linguistic point of view, when you use a linguist, which is a highly trained, highly experienced, deeply knowledgeable resource and you put them on project that you haven’t provided clarity with the customer what’s really needed, you as an LSP, allow frustration to exist between the two because it customer wants cheap and fast, then linguist wants to do a professional job and you haven’t bridged the two, so we should be able to go and some jobs are. This is a quick… quick and faster of this all about volume so if you want a bunch of volume and you want to just push her a bunch of volume you are using TM and NMT tools this is a great job for you and that’s what you’re trying to achieve as a linguist, this is a good fit for you.

 

This is a job for your skills and understanding in control valves, or your experience and understanding in medical processes is going to be valuable, then this is a job for you and that empowers the individual linguist or interpreter to take work that is reflective of what they want to achieve, and I think as long as an LSP we can provide clarity in terms of you know what it is the customer wants, so therefore what type of skills are needed to achieve that end result, I think people drive value from achieving, you know, a goal that is clearly set.

 

Sultan Ghaznawi

So, Nick, what we’re still talking about value within the organization, how does a company that’s so focused on delivering value, but I would like to hear from you, how would they quantify and measure that value? Because it’s not just quality or metrics of quality of how great the translation was, how do they improve on delivering value? And first of all, you have to measure it and then improve it.

 

Nic McMahon

Yeah, no for sure and to the discussion earlier it’s like it’s got to be, you know that at this stage state, you know what we’ve got to step four of our you know language solutions maturity is you… you’ve gotta like the quality of translation in in, you know, as we’ve moved to this outcome thing, hardly anybody has quality of translation as an outcome like I I’ve yet to experience that. Don’t get me wrong, right in medical claims you have to have 99.5% or higher from a regulatory requirement point of view and quality. When you do e-learning course, this is, you know, everybody expects at least 90 percent, 95% quality. I mean it’s like 90… if you ask me, 98% quality is an industry average in terms of expectation and you know percentage of failure they want 98% error for 98% error free, right? So, but none of those define value like none of those or attributed or connected to that.

 

Nobody gets higher value when you’re 97% versus 98. Nobody gets higher value when you’re 98 to 99. Even if you were like 80, it probably would not communicate into value and so you know when you’re looking to sort of create value, the concept of a quality metric to create value is not… is a non-starter. I’ve never seen it. KPIs that drive value are, you know member of… retention, member engagement, member traction, so how many, you know, members of the health care person actually get into the door. It is a learning engagement, learning completion rates, learning retention. It is SEO performance. It is market expansion. It is number of you know downloads or clicks. They are KPIs that drive value, translation quality… I’ve never seen an example where translation quality d rives value, is a given requirement of the industry and a proxy.

 

It is a bit like milk, you know, you get real like you know either you know Gary’s Farm, you know in a glass bottle, or you know from Alpenrose you know in a plastic box, there’s just an expectation of value, like our quality. You expect that milk to be OK. And it’s only when the milk is sour or the translation is bad, do you… you know, do you actually make a comment on it.

 

Sultan Ghaznawi

It’s important for you to know, how do you map the outcomes-based value that you’re defining to your client to your internal KPIs for example, like you know, our project managers should improve doing this thing in order to improve the value we are delivering to our clients.

 

Nic McMahon

And its program specific, so I mean, but it’s but it is linearly, it’s literally tied to what you agree with the client. So, I mean, if you want right so you know I, I’m a bit nervous about it. ’cause like it’s like why am I, you know, it just means to try and work it out on the spot. Normally this takes a lot of time and some meetings, but like you know, if you if you give me an example of a service you deliver, I will try to sort of give you a view of what might be a KPI for it. So can you think of a service that you deliver, you’re like OK, we delivered this service.

 

Sultan Ghaznawi

For example, let’s say we are delivering translation services for refugees for a very specific, rare or hard to find language that we have been able to kind of create a framework around that, but I know that the outcome is obviously improving people’s lives by making sure that they get their documents translated quickly or something like that nature, right? So how would that, how would I actually take that outcome and create a KPI for my project managers for that matter?

 

Nic McMahon

Yep, so you know again, right? It’s like… right? But in my head, it would be something like… s o your actual net outcome right is a rare language refugee, you know, being able to affectively navigate a new community, right? So, you know that it would be something like that, so then what you would want to be able to do is say OK in order for us to effectively drive value with this environment, we’ve got to have accessibility to the KPI metric of effective in navigation within things. So can you survey these members, you know, and you say that’s your client, like I’ll be able to survey these members and get a qualitative rating back from them that were they able to navigate the documentation required to work within society and so do they believe that as they try to integrate, you know into their new society that the documentation was a limiter to their integration ability.

 

So then you would say OK, so give us that data because if you if you want to drive value and provide translation but you actually want to drive value, then you’ve gotta hold the line and say look we need to know this data to know that the work we do and supply to you is really driving a meaningful outcome because there’s a whole bunch of things involved in that, and there’s culture, and there’s awareness of content and what we want the conversation to bring back is like for some reason that person failed to believe that the documentation supplied helped them integrate into a community, because then you can have a conversation with them is like OK, what would it take, you know, maybe we need more documents, maybe different documents. Right?

 

But you’re having a different discussion than what was the translation quality of document X? Because the translation quality of document X is unlikely to be the reason that refugees do not integrate into society. So, you say what’s the KPI success? They say integration into society. You say, OK, like let’s have a look at it and then, if they see that the integration in society starts to fool, you have the grounds have a much more holistic discussion with them in terms of OK what would it take you know, OK, we could try to translate that document in a different way and see if that integration society goes better. Or could we take a look at the documents that are being provided and see if there are any gaps? Because maybe there are documents they’re missing, so maybe we need to add some documents in. Or maybe it turns out that there is a cultural bias to those documents. And so maybe we need to rewrite those documents rather than just get them to fill them out.

 

But all of those discussions are not your translation into Somali sucks, because that’s not what’s holding the Somali refugee back.

 

 

Sultan Ghaznawi

Right, and as we discussed Nic earlier, every translation company delivers translation. Now the company that can demonstrate the value to its clients I mean, obviously should be able to receive a better word, but in the real world, is that the case or there are companies that are basically relying on translation provider blindly and all they need is, you know to fill a form that says, or a checklist saying you know the translation is completed?

 

Nic McMahon

No, honestly, I’m saying no, like I think most LSP’s you know I speak from an LSP, right? So, I am innately biased, but my experience being LSP’s are populated by project managers, and I honestly do, I know very, very few, I honestly, I don’t know any like I literally don’t know anything. I’m not doing that just at ULG I mean at Lionbridge or at SDL, I don’t, I don’t know any project manager that actually doesn’t care about linguists like I just don’t, and I’m sure linguists feel that way because they’re stuck in this thing between you know they’re probably a high value service, the LSP is you know fulfilling a low value demand. And there’s a rub. The customers want it cheaper. The translators want it higher, and there’s a rub because they said we’re being forced into this negotiation trade off. But it’s because we’re using high quality resources for low quality output, low value content so but I’ve never seen a project manager that isn’t extremely sympathetically…

 

I’ll tell you as an owner of an LSP, I’ll put pressure on my product management teams to be like we gotta find cheaper resources, we gotta drive efficiency within our business and they don’t like you know that is not their primary delivery. They want a good quality translation and they understand and respect the challenge of it so I personally, I’m sure there must be because we’ve got thirty thousand LSPs out there. But it’s I’m I I’ve never seen an LSP either you know, certainly not United Language Group, but honestly, none of the others that I’ve been at where they don’t care about it. The issue is they know it’s sites and they know that customers don’t see the value in the product, but the issue is that the value in the product is not just not seen, it’s not there, because we’re providing a high-quality translation for something that drive very low value back to the customer. When you provide high value back to a customer, they see the value of the service.

 

Sultan Ghaznawi

So, while we are still talking about that, my next question to you, Nic, is do you see a misalignment between the value that some companies provide and what the customers actually need?

 

Nic McMahon

All the time, all the time, like we focus when you look at our standard maturity model is about service maturity. So, we think like you know, like and let’s go back to my tin can analogy, right? Like a tin can is made out tin for a variety of reasons, right? The part that is because it’s a cost-effective well-balanced solution to what, uh, tin needs to be made out of. So you know, what we do all the time is that, oh we’re gonna like with that tin transformation into gold and then suddenly someone gotta be super willing to pay for this gold tin can but you know we’re not alchemist, you cannot pull that trick off. So, the problem is everybody left with frustration, but I think LSPs do carry a significant burden of responsibility because we are the ones who created this this view that maybe I can give you a gold tin can for the price of a tin can.

 

And we should be much clear about the actual value we were driving, so that we could have clarified the conversation and so instead of getting, you know, stuck in this argument about why are we getting gold tin cans, you know all this high value resource being used on this effectively low value content, you know we should have, separate that conversation earlier and sort of realized no, like there’s you know, we’ve got to take the high value resource and put it on high value material and that you know a good example is, you know, post editing can be like that because post editing you know takes, uh, you know, and I’m not talking about post editing the volume but like, you can get a raw translation out of a neural machine translation and then say like yeah, but we really want a honed message. That honed message could be no cheaper whatsoever. You haven’t saved it’s a single dollar, but you use neural machine translation to get you raw so that all of your dollars can be spent on that linguist sitting there and being like does this really connect to a client?

 

But you know, how would I shape this message? How would I shape that message? How would I change that translation? And if that linguist is sitting on that job, not any cheaper job, for that job and spending all of those hours on creating content that engages. There’s value. If that linguist spends 90% of the time creating content without thinking about how it can engage is very little value.

 

Sultan Ghaznawi

So, speaking of value, it means different things to different people and probably different industries. Government may see value in a different way compared to an eLearning development firm, for example. How can, Nic, the messaging around value be tailored for that target audience, for a specific audience?

 

Nic McMahon

Yeah, and then, you know, I would correct the question slightly with due respect. Right? But it would be how you know, how can the outcome you… you need to define the outcome within that, right? So, the government needs rapid response. Uhm, you know, you know, we work extensively with the government, right? They need rapid response and resolution times, right? They are an efficiency driver. It’s honestly not definitively around quality of service is around speed and velocity of service because they have loads and loads and loads of people asking very similar questions and unfortunately, because of that size and scale, they’ve got to focus on velocity and responsiveness over depth and quality of response, and so then when you want to create value for that.

 

You must create a system and encourage resources to focus on the system that delivers velocity and responsiveness, not get the knowledge of understanding so you take something that really truly understands international tax law and you put one in SSA support line, you’re gonna create frustration for both resource and customer, and so you know the way to do it because the different markets is work out what it is those people want to achieve, right? So, the government wants to achieve an outcome that’s very different to you know a standard you know e-learning development company. You know they want to do engagement, right? So, they’re, at the polar opposite, they’re not trying velocity and responsiveness. As you know, the average e-learning thing is about engagement and retention.

 

So, there you do need to set up a process in the system that really is focused on engagement. How did you get the maximum possible amount of the linguist time focused on engagement, right? And is this course engaging and is this course accurately going to engage a culturally specific target audience and so the way you do it, right? It is… it is… it’s not the value, it is the outcome, right? What, what, what’s the right outcome for each of those industries?

 

Sultan Ghaznawi

And let’s zoom in on where we are today, where do you see the most value being created by language companies or in in your words, the outcomes of which industries can we change and improve on and this year, in 2022?

 

Nic McMahon

Yeah, I think it’s a good general call, like both because I think financially honestly, it’s viable. Like I, I think it’s a good financial opportunity, but it’s more than that, like there’s a greater value than the financial return, but I’m anywhere you see equity, opportunity for language interlinked to the culture to help resolve those issues. So, I think you know when you look at your education there’s an equity gap. When you look at legal and support enforcement, there’s an equity gap. When you look at healthcare there is an equity gap. And then I think in areas where there are equity gaps, there is a high degree of motivation to resolve that disparity and address that disparity and produce more reasonable and fair opportunities. It is a very good area to focus on and the value.

 

Sultan Ghaznawi

Understood so as we reach the end of this interview, Nic, please share a few words of advice for language companies that are interested in defining their value proposition better to their clients.

 

Nic McMahon

Don’t be afraid to push your client and to work with your clients to really understand what the impact of the work you do is. So, they may come to you, say, like hey, give us some translation. Don’t be afraid to say, but what are you doing with it, like what are you trying to achieve with this translation? And it is daunting because a lot of people are like aww, you know, who cares about… like I got 50,000 jobs to do. You know you guys just need to get this done. And you know, you need to be professional, right? You need to be polite and so you know there are ways to have that conversation, but I know for fact, the way you have that conversation, you benefit because you align better to the outcome and the outcome creates… but so does the client benefit. And the client goes from them being an internal service provider where they just do what people have been, you know, asking them to do to where they’re adding value back to their organizations because something they’re seen as somebody that drives better engagement, or better, you know member signups and you’re helping them take the same journey.

 

So, I’d say, you know, just imposing somewhat don’t, don’t be afraid to have the outcome solution and try to push it, right? I’m not saying like annoying clients, but, but don’t be afraid to have that that discussion and then try to push your clients a little bit to focus in that area and where you achieve it you will be benefit your supply chain will benefit and so will your customer. You know we’ve had many customers get promoted, you know to non-language specific senior roles because they started to adjust what it was they were doing for their companies and went from I’m providing that translation you asked for to I’m helping you establish global market and so I just I just think it’s an industrial level, it is a well worth the pain of raising it and discussing it with clients.

 

Sultan Ghaznawi

That was a quite informative and interesting interview, Nic, yeah, I really enjoyed it and I think everyone listening today had at least one thing that they learned about creating value, especially with demonstrating how outcomes-based support actually creates value or transforms it for their clients through translation and related language services so I’m hoping I can speak with you in a future episode on a separate topic of interest for our industry. And with that I want to thank you for your time and for speaking with me today.

 

Nic McMahon

Yeah, likewise thank you, Sultan. Thanks for putting the podcast together and for you know being willing to go through the scheduling challenges and everything that can get the stuff done, but I appreciate the effort that you put into the process too, so thank you.

 

Sultan Ghaznawi

As you heard, value is an important subject that is often misunderstood early, collected in our industry. Almost every translation company promotes itself as a quality provider, whereas that is probably not the obvious value clients are looking for. Quality is expected regardless. Nic touched upon some very interesting ideas on how we can demonstrate the value to clients that we generate and the debate about value creation versus value transformation will continue for a while. I personally think we do create value in the sense that we enable a customer to sell more products or solve problems using language and communication, hence outcomes-based solutions. The way we create value internally through the hard work of our human workforce or using automation and technology will be an important topic to discuss going forward. How we generate value is equally important as what value we create. As an industry we need to focus more on highlighting how we do this. For example, did we help refugees find new homes through language, did we increase the sales of a company that wanted to expand in a non-English speaking market? As you can see, it’s the impact and the outcomes that matter. We need to stop talking about tools, process quality and other things that make sense to us only and start talking the language of our customers.

 

Sultan Ghaznawi

There you have it. I’m very happy I had a chance to speak with Nic McMahon from ULG. I am hoping you enjoyed this episode and as usual please share your comments, thoughts, ideas, topic or guest suggestions or anything that you would like to get from this podcast. Don’t forget to subscribe to the Translation Company Talk podcast on Apple Podcasts, iTunes, Google Podcasts, Spotify or your platform of choice. Don’t forget to rate this episode with five stars or give us a thumbs up to promote the ratings.

 

Until next time.

 

 

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