A CFOs View to Localization

This article has been updated and moved to a new location.

Localization from a CFOs point of view is a product development investment that allows you to sell a product to the global markets. The question whether or not to localize a product is determined by the ROI (or the NPV) of the investment.

There are several key factors influencing the ROI equation:

• Initial investment
• Time to market
• Acceptance at the target markets and
• Recurring costs
• Transaction costs

Initial Investment

The initial investment typically includes the initial translation of the software, user manuals and online-help. It also includes the cost of adapting the products software architecture. Please see the FAQ for more details.

Options to reduce the initial investment include the partial translation of product documentation and the translation with lower quality.

Time to Market

Sometimes time is a more critical variable then cost, because of oportunities that may get lost to competitors. The most important factor that determines the project durantion is the amount of text to be translated. Also, the integration of marketing and sales with product development can consume time, because I18N projects include important learning processes of all participants.

Options to improve the time to market include the use of large teams of translators equiped with Translation Memories.

Acceptance at the Target Markets

Some target markets are extremely demanding in terms of the adaptation of jargon and cultural conventions. I have heard from several projects with acceptance issues in Japan and Germany.
In general it is necessary to present a consitent and flawless appearance to the clients in each country, synchronizing the activities in:

• Marketing material
  This may include the identification and adaptation to culture specific needs different from the US.
• Product packaging translation
• Product localization
• Product documentation translation

Recurring Costs

There are several optimization techniques to reduce the recurring costs of localization and related services during the lifetime of your product. Please see the CTOs View to Localization article for details.