Part 5: How to continuously get more value from your translation supplier

Armand Brevig 27 Nov 2020 4 min read

In this five part series, Armand Brevig, Managing Director of Procurement Cube, offers his thoughts on how procurement professionals can maximize their impact when sourcing global translation services.

In previous articles I have shared hints and tips about various aspects of procuring translation services. But it’s far from over when a contract with the new supplier is signed. Now it’s time to make sure all those benefits you promised stakeholders actually come to fruition. If, for example, the projected benefits included lower total costs driven by deployment of translation technology, you need to make sure that vision is actually realized.

The way to do that is to proactively manage the supplier relationship. And as a procurement professional, you are well placed to take the lead. Not only does procurement have the skills needed to implement meaningful supplier relationship management, but because translation spend is often fragmented across the organization, it naturally falls upon procurement to lead and co-ordinate in this space.

Developing thoughtful Key Performance Indicators (KPIs) jointly with the supplier is central to building a strong and evolving relationship. By “jointly”, I mean KPIs that measure performance on both sides – not just the supplier’s performance. After all, a relationship is a two-way street. As a buying organization, are you providing the supplier with all the information they need in a timely manner? Do you pay them on time?

You then track these KPIs in regular Business Performance Meetings and agree corrective measures where needed. Depending on how performance develops, you may want to introduce new KPIs and/or stop tracking some of the existing ones. Just don’t over do it with respect to the number of KPIs. They are called key for a reason, so it’s about focusing on the few priorities that really matter.

The carrot and stick approach to compliance

A sure way of damaging the supplier relationship is to allow spend leakage. By that, I mean allow users to continue using their legacy suppliers and ignore the new deal you have worked so hard at negotiating. Receiving less revenue than anticipated is disappointing to suppliers. A disappointed supplier is an unhappy supplier. And unhappy suppliers are not particularly keen on jumping through hoops to meet your KPI targets.

So, how do you ensure compliance from users of translation services? In my experience a combination of “carrot” and “stick” works well. Early in the life of the sourcing project you need to communicate the intention to remove legacy suppliers from the Purchase-to-Pay system and explain why the new way of working with only one (or a few) supplier(s) is better for everyone. This will help set expectations.

Once the contract is let, the supplier can help educate users in a more specific way. The supplier should be happy to do this type of awareness work for you, as it directly impacts their revenue. However, for the supplier to effectively do that, procurement needs to open the right doors to give access to relevant stakeholders.

So, the “carrot” is to show users a better way of getting their translation needs met. The “stick” is to remove all legacy suppliers, after a reasonable grace period. And don’t allow any exceptions to the new process, unless a requirement was genuinely missed in the Request for Proposal (RFP) process.

Ensuring compliance and effectively managing the relationship will pay off in terms of the business value you can get from the deal. But how do you know when it’s time to test the market again by issuing another RFP? 2 years down the road? 3 years? The problem with regularly re-tendering is that it’s a time consuming, and therefore an expensive process. Also, when you have invested resources in developing a performance driven supplier relationship, regular re-tendering is disruptive.

Rather than letting time lapsed determine when you re-tender, it’s more productive to look at how the KPIs are tracking and let that decide whether it’s time to test the market. If the KPIs indicate that the supplier is no longer meeting expectations, re-tendering may be warranted. If, on the other hand, the supplier continues to add the expected business value, there really is no justification for disrupting a relationship which you have spent years nurturing.

Visit How to Buy Translation Services for more information. And if you'd like to learn more about this topic, why not watch RWS's Jane Freeman interview Armand, where they discuss best practices to help you avoid costly mistakes.