CSA Research on Industry Impact of COVID-19
The ATA-TCD interviewed CSA Research on April 20, 2020 on the industry impact of COVID-19. The responses below are based on the primary and secondary research data and analyst insights of CSA Research at the time of submission. As the market is rapidly evolving, please refer to CSA Research’s COVID-19 Resources page for ongoing updates.
What impact do you foresee that COVID-19 will have in our industry?
CSA Research’s industry surveys show that demand and spend are mainly down or flat. Across the language sector, 87% of employees are now working remotely, up substantially at many companies. Hiring, raises, travel, and in-person events are a thing of the past. At this point, we find that the pandemic’s effect on demand and spending for language services is severe.
Beyond the slowdown in demand for their services and universal uncertainty about what happens next, CEOs are concerned about keeping their teams intact so when the COVID-19 pandemic is over, they will still have their most important resources in place (“COVID-19 LSP Survey Data – Overall Results”). We also found that companies on both the supply and demand side of the language sector are cutting non-essential costs, while buy-side companies anticipate budget cuts for language services as part of across-the-board spending adjustments.
The impact on the language industry depends on the timeline. CSA Research sees the effects playing out over three stages of the pandemic and its aftermath – what LSPs do now in reaction to the current situation, what comes next while the world waits for a COVID-19 cure, and for the post COVID-19 era. Pay particular attention to its effects on:
- Employees’ mental health. Unaccustomed to working at home and on their own, many staff members may be uncomfortable, lack confidence, and be stressed by working from where they sleep. The mental health and comfort of employees is and will remain a key issue even when the stay-at-home confinement ends.
- Changing buyer requirements. LSPs must adjust to their clients’ new demands in the increasingly online world driven by the shift to remote locations and more online activity: 1) Internal and outward-facing content must become more remote-friendly while web content must improve in quality and depth; 2) suppliers must respond to quick-turnaround requests without the usual project overhead; and 3) globally applicable content particularly in communication and customer experience will become a bigger part of global enterprise language service planning.
Do you have any recommendations about how companies can prepare for the future and help mitigate the impact?
It’s up to all of us to keep our families, friends, and colleagues safe during the COVID-19 pandemic. As the business climate changes daily, we cannot predict the full outcome of the pandemic’s impact on the language services industry. CSA Research continues to collect and analyze primary and secondary data to assess and make recommendations moving forward.
Based on current conditions, here are ways providers, buyers, and linguists can prepare for the future and mitigate impact. Unlike natural disasters, the COVID-19 pandemic will end with the infrastructure intact and we can expect a fast recovery when this crisis is over. Key decisions you make now will help through the transition from the current pandemic to the post-COVID-19 business climate.
- Lead your company through these transitions. “Leadership” in the midst of a crisis means going beyond your reactive responses to update contingency plans and provide tools to work in isolation. Communicate, motivate, enable, keep the business on track, and plan for a post-pandemic recovery (“LSP Leadership in the Time of COVID-19”). Plan for different scenarios and explore new products and services.
- Keep your team physically unharmed and mentally strong. Working remotely is new and challenging for many employees. Managing uncertainty is more difficult. Eliminate some of that uncertainty by keeping your team together (“Preparing Your Team for a Post-Pandemic World: The Team Factor”). Train employees to be ready for the eventual post-pandemic world.
- Pay attention to your clients. COVID-19 has revealed what companies should have been doing but many had neglected. Although the current situation will challenge even the best run LSPs, those that value and support clients will emerge stronger than their competitors. Invest in customer care and global customer experience.
- Assess current technologies and explore new ones. If your systems don’t work well today, they won’t work any better after the pandemic. Review your core technologies and processes to better support clients and prospects, especially as you will rely more on distributed teams of remote staff.
- Remember the near past – and plan for business continuity. COVID-19 is top of mind now, but not that long-ago SARS, H1N1, avian flu, and Ebola were headlines. Having a business continuity plan in place as do 65% of the 193 largest LSPs is crucial. Rethink your remote business requirements and assess how well your technology aligns with the new decentralized reality.
It is not about when this crisis will end but how companies must ready themselves to jumpstart their businesses and act responsively and intelligently to the new market landscape.
Below: Results from CSA Research’s March 2020 survey of the largest 193 ranked LSPs on the issues they feel have the greatest impact on the industry.
About CSA Research
Common Sense Advisory (CSA Research) is an independent market research firm. We help companies profitably grow their international businesses and gain access to new markets and new customers. Our focus is on assisting our clients benchmark, optimize, and innovate industry best practices in translation, localization, interpreting, globalization, and internationalization.