Rising to the challenge: How LSPs can adapt to evolving industry trends

Nicole Loney 23 Mar 2023 7 mins read
The constant evolution of technology, increasing demands of the localization market and unpredictable economic conditions make it more important than ever for LSPs to keep efficient and agile.
To help us better understand the pressures and trends in our industry, and the role of technology, we recently conducted a survey that was completed by over 200 language service providers from more than 40 countries. We published our key findings from this survey in the Translation Technology Insights (TTI) 2023 Report at the beginning of March. This was the third survey of its kind – we published our first TTI report in 2016 and the second in 2020.
In this blog, I’ll take a closer look at what the key findings from the TTI 2023 report indicate for LSPs. I’ll highlight some of the demands that LSPs are facing, and how technology can help to ease these challenges.
Increased pressures everywhere
As businesses have come to understand the importance of localizing their content to access new markets, demand for localization has increased exponentially. While freelance translators and corporate translation departments are also experiencing a surge in work requirements, LSPs are feeling the brunt of it.
This was apparent in our latest TTI report where 45% of LSPs noted an increase in the number of project files they are receiving, and 38% saw an increase in the number of customers requesting work in the last 12 months. To add to this increased demand, clients are putting LSPs under pressure to reduce their prices further and deliver translations faster.
Concerns around pricing is nothing new – LSPs have been voicing their fears around stagnant or falling prices for years. However, due to rising inflation and economic uncertainty, corporations across the world are tightening their budgets, translators are demanding more for their services and LSPs are stuck in the middle balancing the two. With demand intensifying, just how do LSPs meet these pricing pressures while delivering translations faster and to a high quality?
A less experienced workforce
To add to this conundrum, our latest TTI report also highlighted a growing skills shortage in the industry. When comparing results with 2020, we can see that:
  • In 2020, 73% of LSPs had more than 5 years of experience; 27% less than 5 years.
  • In 2023, 69% of LSPs have more than 5 years of experience; 31% less than 5 years.
What’s even more worrying though, is that this decline in experience is noticeable across the entire supply chain (see graph below). LSPs sit at the heart of the localization process and are already relied upon by both their clients and vendors to provide advice and support. With a less experienced workforce, requests for assistance will only increase, putting further strain on the already busy LSP.

But one thing is crystal clear - with fewer people entering the industry, LSPs will find recruiting new talent increasingly difficult. Plus, as the law of supply and demand states, when demand is higher than supply prices will rise, meaning when you do find new talent you may not be able to afford to hire. In the latest ‘The 2022 Nimdzi 100 report’ LSPs stated that talent acquisition and talent retention were two of their biggest challenges right now.
The question posed above then becomes even more complicated. With demand intensifying and the available pool of linguists becoming less experienced, how do LSPs deliver the same high-quality translations faster and cheaper?
The role of technology
With recruitment no longer an easy solution, LSPs are turning to technology to ease the pressures they’re under. According to the 2022 Nimdzi 100, “More than three-quarters of LSPs are now investing in technology as part of their growth strategy”.
LSPs have always been avid adopters of translation technology, they understand its importance to effectively serve their customers. Despite this, 83% of LSPs believe they need to improve their translation processes to meet the challenges they face. With CAT tools still featuring as the most used technology by LSPs (90%), this is no surprise. CAT tools were primarily built to improve individuals’ performance on core translation tasks, they weren’t designed to simplify project management nor to facilitate agile collaboration.
Newer technology, such as collaboration tools and translation management systems help teams become more efficient by streamlining processes and automating time-consuming tasks. Fortunately, 54% of LSPs recognize their value and plan to invest in collaboration tools as the next step on their maturity journey.

It’s also notable that very few (just 9%) of LSPs are looking for new features or software, suggesting they have all the pieces they need to do their job well; the challenge is to know how to use them effectively. 56% of LSPs want greater levels of product support and 51% have asked for more/better training, painting a picture of an industry that needs to do more to support its users.
Ways that Trados can help
There are many strategies that your LSP could implement to adapt to the evolving demands of our industry and Trados can support you with this in several ways. Here are my top suggestions based on the TTI 2023 report findings:
  • Make the most of your existing translation technology
  • RWS Community: A knowledge-sharing community of Trados users and experts.
  • Resource Hub: Browse through many resources on our website, including reports, videos, product briefs and more.
  • Built-in product support: We offer support and useful tips right where you need it – within the software.
  • Online webinars and events: Our webinars and events provide educational sessions that are recorded so that you can watch them at a time to suit you.
  • Training courses (paid): Our training courses are delivered in various languages by industry experts and are available onsite or online.
2. Adopting new technology
As already mentioned, the TTI report highlights collaboration tools as being the priority for LSPs when considering what translation software to invest in next. We also learned that, on average, LSPs already use five different translation technologies to run their business, however, only 18% of LSPs currently use integrations and connectors to link their systems together. Based on these stats, it’s obvious why 83% of LSPs acknowledge that they need to improve their business processes to meet the challenges they face. Using disconnected systems significantly slows down the translation process and impacts time-to-market.
Our collaboration tool, Trados Team, could help to streamline your workflows; it works seamlessly with Trados Studio to help translation teams to deliver high-quality projects faster and more cost-efficiently. Trados Team also offers a selection of connectors to link the systems and applications that support your business. In addition, there are a large number of, mainly free, apps available from our AppStore that will enable you to personalize your translation environment and customize your translation processes.
3. Attracting new talent to the industry
Finally, the TTI report suggests that there has been a downward shift in experience within the industry, and that recruiting new talent is becoming more difficult. Although there is no simple answer to resolve this, we do know Generation Z highly value modern tools and are attracted to organizations that offer hybrid working practices. Adopting cloud technology could therefore help to make the industry more appealing to new entrants. Not only does cloud technology provide flexibility to work from anywhere on a variety of devices, but for the LSP, it also provides a secure, centralized way to store your files and translation resources. These suggested strategies are based on challenges that translation industry professionals currently face, as shown in our TTI 2023 report. To learn more about recent trends and how attitudes towards technology have changed in recent years, read the full report.
Nicole Loney

Nicole Loney

Product Marketing Manager
Nicole is a Product Marketing Manager at RWS. Nicole focuses on the translation technology needs of freelance translators and LSPs. She is responsible for generating product-focused content and conducting market research for the Trados portfolio. Owing to her degree in marketing and French, Nicole has developed a passion for consumer behavior, understanding what customers need and directing them to solutions that will help.
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