Should your LSC buy or build its own management software?

As a consultant to smaller, fast-growing language service companies (LSCs) and as a former owner of such a company, I am frequently confronted by company owners with the question: “Should we build our own business management system or should we buy one?”

Fifteen to twenty years ago, this was a critical question for company owners to ask themselves since the specialized software we see offered today to the language industry did not exist. Going it alone and building your own software may sound exciting, but here is why buying may be the better choice.

New millenium, new tools

Around the year 2000, if you wanted a translation business management system (BMS) that reflected how your company works, building it made sense. The capability of the software being offered prior to around 2006, consisted of first-generation systems that individual LSCs, who had committed to building a tool of their own, decided to sell to other LSCs.

Flash forward to 2010 and the options offered by DIY LSCs or independent software developers (such as Plunet GmbH and later XTRF) began to grow and buy vs. build became more of a real option. But despite the longer list of BMS titles available to LSCs today, the idea of building one’s own system is still alluring to many company owners.

What drives LSC leadership to still contemplate making a bespoke BMS?

When speaking with LSC owners the complaints about existing project/business management systems fall into four different areas:

Cost

BMS software is not an inconsequential cost for a growing translation company. Between the initial cost of acquisition, implementation, and on-going maintenance/support contracts, the average monthly cost can be as much as renting an office. Not surprisingly, this cost is cheap compared to developing a comparable tool in house. But most LSCs fall into the trap of thinking doing it themselves is cheaper. Unless you’re a code-writing wunderkind who also happens to own an LSC, it is far more expensive to pay existing staff to build your own BMS. The truth is if existing staff have that much time, then there is an issue with your staffing—either their core job is not that important or there is insufficient demand for their services in that job. Either way, the company has a bigger problem…namely sales!

Functionality Gaps

After cost, the second-most voiced complaint about off-the-shelf software is that the functionality is missing features they need or want. This is often valid, but you can always investigate contracting with the software provider to build a custom integration, investigate workarounds or partial solutions that might do the trick. The point is that for most features, if few users want them that the software publisher did not include those functions or does not plan to do so, then maybe they are not that important.

Process variations

The gaps are not in functions but in how the tool maker envisions the translation process differently from how your company executes translation projects. Oftentimes the basic workflow and the types of data tracked for processing translation, editing, and related jobs do not match your company’s requirements. This could be enough incentive to contemplate building your own management system. The reality, however, is that adapting to the software may be more cost-effective and lead to the same result. Being flexible about your company’s approach may be worth changing your mindset.

Interface design

UX is an important consideration when acquiring any software. Is the software’s interface intuitive and easier to learn, or does it require users to adapt to their behavior to use it? Does it present the information you want in a format that makes sense for your organization? Or is it configurable enough to create production dashboards and reports that will help you manage your company?

These are all valid concerns and should be considered when evaluating a management system for your company.

The truth is that for all these points, you can easily be just as disappointed with a homegrown system as you might be with an off-the-shelf system. It is easy to conceive of cool features, functions, and interface design—what’s the saying, “Dreaming is free”—but designing, architecting, building, and maintaining complex software is not a trivial task. Gone are the days when you could build your business with a part-time programmer. The simple existence of off-the-shelf tools has changed the nature of the competitive landscape. For smallish LSPs, time is a luxury you will not have. The impact of technology has taken that luxury away from us.

Why buy is better than build

I argue that if a company owner has time to contemplate building his or her own software to manage the company then that time would be better spent on improving sales strategy, content marketing, operational excellence, or recruiting and retention. Making software is a completely different business than providing world-beating language services. To think that making the software will lead to new sources of revenue for your company only underscores how different the business of software is from language services. You now must sell to your competitors who think they can just build their own management systems! And who will do the selling? If you already have a sales team for language services, do you really want to take them off the field to sell software? What about product support, implementation, training, and ongoing maintenance? All those activities take people and do not follow the cost-friendly outsourcing model of language services.

If you consider the language business management software companies already in business, the majority have originated from within a language service company, but virtually all of them are separate corporate entities from their founding companies. This model might be an option for some language service companies that have a great idea for a management system, but few of the companies that have gone down that path have grown to become top-50 language service companies.

In addition, the management systems made by some of the biggest LSCs are not even that well known within the language services industry…because it is simply that difficult to build and market such specialized software in a specialized industry.

My advice is to find a management system that does as many of the things you want such a system to do for you. Make sure that the software publisher has a realistic and actively managed product road map, and that the software integrates well with other tools your company uses. Master that software to the extent that you can teach the publisher what is possible and train your staff to be more than just basically proficient—teach them to innovate. Treat your software vendor as a partner and make clever use of their implementation, training, and support. Also, make sure there is a role within your company that oversees the management and development of processes around your chosen system.

Finally, take all that creative energy you want to dump into a fanciful software project and unleash it on excellence in sales, operations, and service!