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Can a translation management system help me track performance and ROI?
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Aleix Gwilliam
AuthorAleix Gwilliam
Reading time 5 minutes

Yes, typically a Translation Management System (TMS) will offer reporting and analytics features that enable performance tracking and ROI measurement. The reports can include metrics such as translation volumes, costs, turnaround times, quality, and linguistic performance. These insights facilitate project assessment, workflow optimization, and data-driven decision-making for enhanced localization processes and resource allocation.

To find out more about what a translation management system can do and how it can help your organization’s localization program, click here.

How does a TMS track performance?

A TMS can provide customized reports with metrics that can be used to closely monitor the performance of the localization program. It collects and consolidates data from across the localization process, such as translation volumes, project timelines, costs, and quality metrics. Users with the appropriate permissions can access these reports and download all this data. These reports are especially useful if you want to:

  • Know the volume of words translated for each language in a specific period of time.
  • Find out overall or specific costs per language, vendor, or period of time.
  • See the average time a vendor spends per project and on-time-delivery rates.
  • Compare vendors in order to determine the best-performing and more cost-efficient ones.

With this data available at a glance, a TMS serves as a robust tool for data-driven insights, enhancing visibility of the overall localization process and facilitating strategic actions.

How can a TMS help track ROI?

One of the first questions that comes up during the deployment process of a TMS is “What is the ROI?”. This involves evaluating the costs and benefits associated with localization efforts. Through the TMS’s downloadable data reports, stakeholders analyze these metrics to evaluate localization effectiveness. Some of these metrics include:

  • Translation quality
  • Internal resources cost
  • External vendor cost
  • Revenue
  • Time to market
  • Time savings
  • Source volume

Which questions can help me better understand the ROI of a TMS?

To better understand the ROI of a TMS, there are also some questions you can ask:

  • Has it enabled entry to new markets?
  • Has it caused market share growth? 
  • Have you increased the number of languages you’re translating into?
  • Has there been an increase in the volume of content to be translated?
  • Has time to market (TTM) improved for global content? 

Answers to these questions and data for the above metrics can provide a comprehensive picture of a TMS’s ROI.

Implementing a TMS can typically result in the following improvements and savings* as opposed to managing localization projects manually with offline files and siloed systems:

  • Increase in translation productivity by 30-50%
  • Quality improvement of 25-40%
  • Faster TTM of between 20-30%
  • Ability to scale up the localization program by at least 25-35%, in some cases up to 1,000%
  • Increased translation consistency of between 30-50%
  • Content reuse rates of between 40-60%
  • Overall localization cost savings of 20-40% on average, but could be up to 90% for organizations with complex, high-volume scenarios
  • Customer satisfaction improvements of between 25-40% 

*These statistics are estimates based on industry studies, expert analysis, and user reports. Speak with your technology provider to estimate your ROI.

Any of these factors can lead to a significant return on investment of a TMS, which should not only be perceived from a savings point of view but also as a revenue maker for the organization.

Expert tip

Gianluca Savenije
Gianluca Savenije

When it comes to calculating the ROI for a TMS, you need to consider that some cost savings will be direct and others indirect, and therefore harder to measure. Direct savings come via the improved leveraging of translation memory, increased use of machine translation, and reduced spend on vendors through transparent pricing. Indirect cost savings are through automation of workflows and integrations to your content sources. Make sure you lay out both savings types when calculating your TMS’ ROI.”

Gianluca Savenije

Senior Director – New Business Sales at XTM

Interested in finding out more about how a TMS can drive revenue and growth in your business?

Get in touch to discuss more about how a TMS can not just save on localization spend but also be a profit generator in your organization.