The costs of language misunderstanding

Today, it is estimated that more than 7,000 languages are spoken in the world, without considering the countries with several official dialects. Thus, in a globalized economy, it is easy to understand that having multilingual employees is a major challenge for companies. This allows more business opportunities of course but also, to reduce costs.

Multilingualism: what is the economic impact?

In 2006, the European Commission’s ELAN report (Effects on the European Union Economy of Shortages of Foreign Language Skills in Enterprise) found that 11% of businesses lost at least 1 contract, for the simple reason that their staff lack multilingual skills. After several studies, the CEREQ (French Qualifications Study and Research Center), published in early 2016, concludes that this lack of language skills in companies must be rectified fairly quickly.

Thanks to these studies, we now know that multilingualism has an economic impact. and that it contributes to the productivity and profits of companies. In France, for example, the working language is French, but with the opening up of the economy and numerous commercial partnerships with other countries, English has made its foray into the business. And it is not the only major international language with an economic impact. Spanish, Arabic, Russian (widely used in Eastern Europe) … have also entered trade.

Companies established in non-French-speaking countries which wish, for example, to establish partnerships in Africa must master French, which is the language most used for trade negotiations. In addition, mastering local languages is also important to be able to do business in certain regions of the world.

One in six businesses will experience losses due to a lack of language skills and cultural awareness. In Switzerland, for example, the economic value of multilingualism is estimated at over 10% of GDP. This is because people are able to work easily in several languages in a large number of companies and organizations. Many companies understand and seize this opportunity to differentiate themselves and grow the value of their services or products.

What solutions can we imagine for the lack of mastery of linguistic skills?

To win international markets, a company can simply hire a translator-interpreter to communicate and negotiate. But this solution might not be the best in some cases such as setting up long term international partnerships.

First, it is a solution that may prove to be more costly for the business, without really solving the problem in the long run. As a translator-interpreter is not a full time employee of the organization, he / she will be less involved in achieving goals. Beyond this economic aspect, it can also have serious security implications. For example, imagine a mechanic in aeronautics who does not understand his team leader’s instructions well because of poor command of the language in which the latter is expressed. This can have an impact on the setting of the device and consequently on the life of passengers during a flight.

It is therefore recommended that companies look for more long term solutions to improve the language skills of their employees. With the advantage of being inexpensive while increasing their competitiveness in the international market, developing the language skills of a company’s teams is essential. In addition, it helps to retain employees who will see their professional and personal skills increase.

For more than 30 years, at Bright Language, we have supported companies in all sectors and more broadly all socio-economic players to develop and certify the language skills of their employees. Thanks to our internationally recognized tests, we help organizations assess the language level of their employees quickly, reliably and objectively. And therefore, contributing to their growth and impact.

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