ROI of Multilingualism: Corporate Success Thanks to Multilingual Employees

In today’s globalized business world, multilingual employees are invaluable to companies aiming to expand into international markets. Their abilities extend beyond language skills, directly influencing a company’s success.

This article explores the ROI of multilingualism, highlighting how leveraging the talents of multilingual employees can drive company growth and provide a significant competitive edge.

The ROI of Multilingual Employees: How to Measure It

In order to understand the value of a multilingual workforce, the cost of employing them must first be calculated and compared with the overall benefits they generate for the company.

Key Factors for Measuring ROI

• Expanding the Customer Base: Evaluate the potential impact of multilingual employees by determining the number of new customers or markets that could be reached thanks to multilingual employees.
• Customer Satisfaction and Loyalty: Analyze feedback, customer surveys, and other relevant indicators to determine if existing multilingual employees have a positive impact on customer retention and churn rates.
• Increase Sales and Profits: Determine whether their language skills have led to increased sales, new business opportunities, or partnerships with customers from other language backgrounds.
• Competitive Advantage: Evaluate how their language skills set your company apart from the competition and how this impacts winning new business or securing contracts.
• Cost Savings: For example, if translation services were previously outsourced, there may be cost savings if your employees can take on these tasks internally.
• Team Productivity: Evaluate whether multilingual employees work more effectively with their team and thus improve communication within the company.
• Level of Language Skills: Assess your employees’ existing language skills and quantify their ability to communicate effectively in multiple languages. Consider factors such as fluency, comprehension, and the ability to perform work tasks in different languages.
• Language Training Costs: Determine the costs of language training for your staff. This includes training, materials, and any additional resources required. Digital language service providers such as Speexx offer online language training with personal coaches as a convenient all-in-one solution.

Once you have collected all the necessary data, you can calculate the ROI using this simple formula:

ROI = (benefit – costs) / costs * 100

Considering Quantitative and Qualitative Factors

To evaluate the return on investment (ROI) of multilingual employees, both quantitative and qualitative factors must be taken into account. Let’s take a closer look at the reasons why multilingual employees are crucial and the key benefits they bring.

Why Multilingual Employees Are Crucial

Robert Lane Greene of The Economist points out that among the world’s richest economies, many are dominated by countries known for their multilingualism:

• Luxembourg
• Switzerland
• Singapore
• The Scandinavian countries, where English is widely spoken.

Multilingual employees can help companies break into new markets by overcoming local language barriers. According to a study by Common Sense Advisory, 72.4% of consumers are more likely to buy products with information available in their native language. This presents a significant opportunity for companies to expand into non-German-speaking markets and drive new growth.

Effective communication is the foundation of successful relationships, both internally and externally. A multilingual workforce can enhance external collaboration and foster stronger relationships with international partners, customers, and clients.

Furthermore, language skills often go hand in hand with cultural understanding. Multilingual employees can help companies navigate cultural nuances, habits, and preferences, enabling them to tailor their products, services, and marketing strategies to specific target markets. This cultural intelligence can be a critical factor in building a brand’s reputation and gaining a competitive advantage.

Multilingual Employees Bring Competitive Edge

What are the exact competitive advantages of hiring employees who speak multiple languages? In a highly interconnected world, having a workforce that can communicate in multiple languages offers several distinct advantages, and research confirms that organizations with multilingual employees are better positioned on many fronts. Here are 3 advantages:

• Expanding into new markets: Multilingual employees can help companies overcome language barriers when entering new markets. According to a study by Common Sense Advisory, 72.4% of consumers are more likely to buy products with information in their native language. This represents a significant opportunity for businesses to tap into non-English-speaking markets and drive growth.
• Build strong relationships: Effective communication is the foundation of successful relationships, both internally and externally. A multilingual workforce can improve collaboration and foster stronger ties with international partners, clients and customers. This advantage can lead to improved customer satisfaction, increased loyalty and, ultimately, higher revenues.
• Gain cultural insight: Language skills often go hand in hand with cultural understanding. Multilingual employees can help organizations navigate cultural nuances, customs and preferences, enabling them to tailor their products, services and marketing strategies to specific target markets. This cultural intelligence can be a decisive factor in building a brand’s reputation and gaining a competitive edge.

How Multilingualism Increases the Productivity and Commitment Of the Team

Multilingualism is not only an external but also an internal advantage that has a positive impact on employee productivity and commitment.

• Improved problem-solving skills and creativity: Research has shown that people who speak multiple languages have better cognitive abilities, including improved problem-solving skills and creativity. By utilizing your employees’ multilingual skills, you can benefit from their broader perspectives and innovative thinking, leading to more robust solutions and greater efficiency.
• Greater flexibility and agility: multilingual employees can adapt quickly to new situations. This is an advantage in international collaboration, in negotiations and generally when solving problems. Their language skills enable them to reorient themselves quickly, which leads to better decision-making and flexibility in a changing environment.
• Higher employee satisfaction and retention: Companies that invest in language training for their employees are signaling their commitment to their growth and professional development. This investment not only increases employee satisfaction, but also employee retention.

The Financial Impact of Multilingual Employees

A study by Cardiff Business School calculated that monolingual Britons lose a staggering £48 billion a year in today’s global economy simply because of a lack of language skills. So, let’s look at the financial upside of multilingualism and its potential to deliver a strong ROI:

• Increased revenue generation: Numerous studies have shown a positive correlation between language skills and revenue growth. According to a Harvard Business Review survey, companies that invest in language skills outperform their competitors by an average of 2.5%. Multilingual employees can make a significant contribution to sales expansion, customer acquisition and overall revenue generation.
• Cost savings in translation and interpretation: Relying solely on external translation and interpretation services can be expensive. By leveraging the language skills of multilingual employees, organizations can reduce outsourcing costs and streamline their communication processes. This cost-saving benefit can be particularly relevant for multinational companies with a global presence and extensive language requirements.
• Improved efficiency in international projects: Multilingual employees can play a crucial role in international projects, eliminating the need for constant translation and interpretation, and reducing the potential for miscommunication.

Which Languages Are Worth Investing In?

Now that we know more about the benefits of multilingual employees and how to measure their ROI, let’s take a look at the languages that are most worth investing in.

According to Statista, English and Mandarin are the most spoken languages in the world, followed by Hindi, Spanish, French and Arabic. Mandarin, with over 940 million native speakers, has the highest number of native speakers globally and is the second most widely used language on the internet.

Further information on this topic can be found here: The most important foreign languages in companies.

Are Schools Laying the Foundations for Multilingual Employees?

Eurodice reports that in the EU, students in vocational education learn fewer languages than those in general education. In general upper secondary education, only 2.9% of students learn no foreign languages, 37.1% learn one foreign language, and 60% learn two foreign languages.

English is still a priority for most – over 90% of students in the majority of schools across Europe learn the language. More than 20 countries require students to study two foreign languages, with French, German, Spanish and Russian as the most popular after English.

To celebrate the diversity of European languages, the Council of Europe dedicates 26 September each year to languages and promotes various events across the continent. The European Day of Languages aims to highlight that “linguistic diversity is a tool for achieving greater intercultural understanding“.

Are You Prepared to Promote Foreign Language Skills in Your Company?

A survey by ACTFL and Pearson reveals that nine in ten U.S. employers rely on multilingual employees, with a third heavily dependent—a trend expected to grow. Imagine how much more efficient your business could be if employees communicated with international customers in their local language or gained deeper market insights by understanding the language and culture.

We see a strong language training program as a win-win situation for everyone involved. So, start building language skills in your organization today with Speexx.