Are You Properly Forecasting Your Freelance Translation Budget?
$56 billion. That’s a number financial executives at every translation services firm should recognize. It’s how much the annual enterprise spend on translation services is expected to grow to by 2021. This translation service spend will only grow as localization, globalization and new technologies continue to proliferate, demand for non-english languages grows and text continues to be generated at breakneck pace.
The need to bridge the barriers of language and communication is more important than ever. Yet, cross-context communication remains stubbornly difficult and expensive. In response, translation firms have tapped into a prolific freelance market, but still lack visibility into non-employee spend and management as they forecast their freelancer head counts. This isn’t a challenge restricted to translation services -- according to Ardent Partners, nearly two-thirds of all contingent labor is unaccounted for in financial planning, forecasting, and budgeting within the average company.
You Can’t Forecast Blind
Human capital costs are a vast chunk of operating expenses, nearly 70% according to the Society for Human Resource Management (SHRM). Human Capital Management (HCM) technology has been built on the foundation of giving insight into every dollar invested in traditional human capital; if you can measure it, you can control it and forecast it. But existing HCM technology fails to addresses the booming contingent labor segment, all those freelance translators that power your business. With the sheer size and growth of these freelance translators, no executive should be driving blind when it comes to managing and forecasting spend.
Using freelancers at scale traditionally entails a lot of manual data entry and spreadsheets to manage (and forecast) their 1099 labor costs. Even for businesses utilizing some sort of specialized software (an accounting package, a CRM or a home-grown system), the ability to manage and track every dollar spent on contingent labor has been incredibly challenging and leaves inevitable gaps in process. Those gaps can lead to the all-dreaded “rogue spend,” that further complicates any accurate forecasting efforts.
Getting the Full Picture on Freelance Spend
Fortunately, there’s a new class of technology emerging designed to help translation service providers better manage and report on their growing freelance workforces. Known as Freelance Management Systems (FMS), this cloud-based technology allows translation firms to find, manage and pay their freelance translators all from one dashboard. At its core, FMS technology allows businesses to consolidate every aspect of their freelance workforce under one roof. More importantly, this software arms executives with a powerful analytics engine they can use to better track, manage and project current costs alongside ongoing budgets.
How much did you spend on freelance vs. full time translators last year? How much more do you need to spend on domain-specific specialists next year? Are you tracking and receiving real-life metrics and reports on your independent workers? What months did you have the biggest 1099 outlay? Executive-level dashboards in an FMS provide quick answers to those questions...not to mention insights into every aspect of your company’s freelance activity.
Translation firms are at a turning point. By arming organizations with the systems, processes and data to manage contingent translation labor in scale, executives can finally forecast, budget, and plan their freelance consultant strategy.