Good communication equals profits
A key element of business success is based on recruiting capable people who are able to build good relationships. Good relationships are based around good communication. Good communication is based on the ability to understand each other. The ability to clearly understand each other is often based on speaking the same language.
Therefore it would be fair to say that there is a direct link between success in international business and the ability to speak languages.
The need for languages in business
Anyone who is serious about doing business in an international context needs to wake up to the need for languages. British companies will be making a big mistake if they overestimate the role of English when their competitors are already able to respond in several languages. New research into recruitment policies of large multinational or international firms shows that UK nationals are effectively disadvantaged through lack of language skills. British companies should be making much more use of language skills.
With the widespread use of English in international business, it is easy to overlook linguistic and cultural factors. It is a dangerous assumption to go from there to believe that English is the only language needed for communication in the global economy. It can have a crucial effect – surveys of exporting businesses show that nearly half have experienced linguistic or cultural barriers and one in five has lost business as a result. In today’s competitive environment, we cannot afford to be complacent about the way we communicate with our customers and business partners. We need good communication to understand and build our markets, to forge relationships, capitalise on opportunities, and use resources efficiently.
The HR perspective
Many UK companies are mistakenly complacent about the need to include languages as a key skillset in the job specification for international positions as well as the Impact of employees‘ language skills on your business; however, this is in fact a critical factor for success. Despite the need to develop the best possible working relationships with foreign subsidiaries, which in many cases may represent a significant proportion of overall profits and potential growth, many advertised executive positions state only that “another relevant language would be an advantage”. But whereas the candidate would not be considered for the job without relevant market sector and managerial experience is stimulated as a key requirement, it is frequently forgotten that due to lack of a managers linguistic skills, foreign managers, colleagues, clients, suppliers, or business contacts may not build a strong relationship with the manager and feel at a disadvantage even resent) holding all meetings in English. In recruitment terms, therefore, the language requirement can therefore be as important as the other criteria.
The Commercial perspective
With new, fast-developing economies and new European countries now emerging as key trade partners, the global business environment is becoming more and more accessible. Consequently, the requirement to better manage an intercultural business and foreign business relationship is becoming even more critical. The products and services we make and supply are also provided by other, non-native English-speaking economies. If their executives possess the language skills to communicate in the local market, whilst yours don’t, then there is a strong possibility that your competitor will win the contract and develop the relationship further.
Think of it this way. You are approached by two executives from foreign companies wishing to do business with you. The first executive speaks Pidgin English, or none at all, and expects you to speak his language, the other speaks English fluently, has experience of working in your market, and understands the business culture. How would you feel towards the first? Even if the first company’s product was better, what happens if there is a post-sale problem? Indeed, language skills stimulate creativity and provide access to contacts and information not available in English, thus giving a competitive edge.
Language capabilities and an understanding and appreciation of international cultures are a “must-have” in order to truly succeed.
The Communication perspective
Only 6% of the world’s population are native English speakers, and 75% speak no English at all. Moreover, we are more complacent than other countries about the need for languages.
The widespread use of English is an important factor that underlies many of these statistics and perceptions. However, its role tends to be exaggerated and used as an excuse for inaction. Although English is widely spoken and used and often said to be ‘the international language of business, poor performance in languages can gave an impact on our competitiveness and our ability to do business?
Surveys of small to medium-sized exporting businesses show that nearly half have experienced linguistic or cultural barriers and one in five has lost business as a result.
The adage ‘You can buy in your own language, but you must sell in the language of your customer’ has been attributed to many, including Willy Brandt, but nowhere is it more strikingly illustrated than in our own export figures. Where English is the language of our customers, we sell more than we buy. However, where the language of our customers is not English, we buy more than we are able to sell.
Recruiting individuals who can speak languages other than English can offer significant benefits for all.
The Risk perspective
What can we lose through poor or lack of language skills? How does poor communication lead to loss of business?
- Difficulties with agents and distributors
- Inability to make effective contacts at trade fairs and exhibitions
- Poor translation causes hilarity or confusion
- Inability to capitalise on opportunities
- Lack of cultural affinity
- Lack of confidence
- Phone and switchboard enquiries not followed up
- Customer unable to access information needed about the product or service
- Failure to explore new markets
How well equipped are UK companies to do business in other languages? International surveys of language skills across Europe tell a consistent tale: the UK is bottom of the league in terms of competence in other languages. A survey of 28 countries published by the European Commission aggregated all non-mother tongue languages spoken and produced a table showing us second last (after Hungary)
True global companies regard language skills as a ‘given’ within the cadre of senior or aspirant management. Employees and managers must be able and willing to think and act in international terms. These companies tend not to think of themselves as UK businesses and do not distinguish between UK nationals and others when recruiting. UK nationals without the necessary language skills are unable to access the international experience required to progress within these companies.
The current pattern of UK international trade reflects linguistic competence rather more than market opportunity. The approach of UK businesses is distorted by the need to avoid markets where English speakers are not likely to be found. It means we are more likely to be tapping mature markets, in which English-speaking contacts can be found, than developing markets that have much greater potential for economic growth. An analysis of export figures by country indicates that successful trade in Europe may be more dependent on others’ skills in English, than ours in their language.
- We do proportionately more business with Scandinavian countries where English is not a barrier to communication than with countries like Spain and Italy where English is not so widely spoken
- In Europe, you can get by in English but this is not true in China or Japan
- Pidgin English leads to chaos. Frequently the foreign customers do not understand even basic English
- Problems often occur not during sales but in after-sales service and support
- Other countries’ use of English as an international language means increased competition for us: Korean Airlines awarded a big contract for flight simulators to a French supplier because the company’s negotiators spoke a clearer and more comprehensible English than the English supplier
The common-sense perspective
Analysis of best practices in companies that make full use of language skills shows that languages are not identified as a separate – and difficult to tackle – issue, but are closely aligned with other factors which make a company successful. Good business planning, seriousness about researching and understanding markets, and concern for effective communication with both clients and the workforce, all go hand in hand with positive attitudes towards languages. There would be huge gains in transferring best practices from successful companies such as the ones described below to businesses that are less aware of the issues. International communication cannot be just delegated to a junior. It needs to be seen to be led from the top with clear strategic commitment and to permeate the whole company. The companies that get this right immediately see the benefits.
About the author
Stirling Austin has built manufacturing, service, and distribution businesses in the UK, France, and across Europe, with turnovers ranging from £2M- to £50M. Bilingual French/English, he is now based in Manchester and runs Pixel Executive, a Digital Agency specialising in building multi-language websites that help businesses grow both locally and internationally.
Stirling founded NIM Europe, an Interim Management firm based in Paris, sourcing Interim Managers and Executives for US/UK companies with subsidiaries in France, and for French companies with UK subsidiaries. After 5 years of successful organic growth; he sold the business on. The company continued going from strength to strength and is now one of the leading Interim Management firms in France.