Is process standardization the right strategy for LSPs?

More and more, customers require a level of specialization and customization from their localization vendors. This means that it is often not enough for LSPs to offer a solid service – they need to be able to adapt that service to fit the specific needs of their customers. Of course, at the lowest possible cost.
This poses a problem for LSPs. We’ve worked with more buyers than we can count over the course of our collective careers and we cannot honestly think of any two buyers that did things the same way. Sure, there are some similarities to be found, but for the most part, everybody has their own way of doing things. Even two different teams using the exact same CAT tool may use the available features in ways that would be unrecognizable to each other because they are dealing with different requirements, goals, budgets, stakeholders, and constraints.
If you work for an LSP, we don’t need to tell you – it’s the wild west out there, people!
Vendors adapt to fit the needs of their clients. It’s impossible for an LSP to have a single set process. An LSP project manager working with 10 different clients may have to manage 10 different processes. Managing different processes becomes even more of a challenge for the LSP project manager if some clients have different internal teams that do things differently.

The same old case for standardization

LSPs spend so much time seeking to improve efficiency through standardization that we have almost forgotten what this means. Indeed, even just typing the words improve efficiency through standardization, you may have thrown up a little in your mouth. We apologize. It is a tired concept, a cliché.  However, just because it is cliché doesn’t mean there aren’t some real benefits because there are, but along with those benefits are some considerable drawbacks.

LSP Standardization – Pros

What makes this a good strategy?
Efficiency leads to better margins
Standardization can offer lower sell rates to customers
Consistency leads to better organizational coherence

LSP Standardization – Cons

What are the downsides?
Inflexible mindset and lack of creativity
Limits the LSP’s trusted advisor status
The LSP is stuck as a “supplier” rather than a partner

What about customized, “flexible” workflows?

Some LSPs choose to take an extreme customer-service approach, prioritizing flexibility over efficiency. This will mean very little standardization because rolling out any standardization will lead to decreased flexibility. However, there are some great benefits to be had as well. While they won’t be as responsive to new challenges, they will be able to build out a well-oiled (and profitable) machine to provide a consistent service at a lower cost to their customers.

LSP Flexibility – Pros

What makes this a good strategy?
Fuller service offering to clients
Ability to build customer loyalty
Creative, engaged team members

LSP Flexibility – Cons

What are the downsides?
Lower margins for LSP
Specialized workflows require team members
Higher costs can strain customer relationships

Can’t we do both?

Perhaps, sure. But we doubt that you can do it well. You would better serve your customers by defining your niche and then investing in improving in that area. Are you competing on cost? Then trim the process-fat and lower costs! Are you competing on service? Then hire the best PMs to hold your customers’ hands.
At the end of the day, each LSP (or maybe even each project manager) needs to define what is right for their business. There are so many different niches in which to compete that there is a time and place for every approach.
As with so many things in life, balance is the key to process standardization.
Too far to the extreme – either toward customization or toward standardization – will limit the ability to serve clients.
Here is a list of ways to achieve that balance

  • Define core activities that should not change and roll out standard processes for accomplishing these
  • Build in flexibility at the program or project level to be able to customize each process without straying too far from the core process
  • Design modular workflows that can be plugged together rather than one overwhelming workflow that cannot be broken into smaller steps. This means that if one component needs to be changed, the whole process does not need to be thrown out
  • No matter how standardized, don’t just hire button pushers for PMs. To the client, PMs are the face of the company. Hire smart people who can think “outside the process”
  • This is an organizational decision. Make sure that your customers and everyone inside your organization knows where your company’s culture fits on the spectrum of standardization to customization. More importantly, make sure they know why.
  • Remember that you can’t be everything to everyone. You can be ultra-standardized and compete on cost. You can be highly customized and compete on service. Or you can be somewhere in between. Pick your niche. Then get really good at competing within it.This post originally appeared on NIMDZI