Hiring an in-house Translation Team vs. External Agencies

There are many reasons why an organization considers adding translation capabilities. Some of these scenarios include expanding internationally, having setup up an overseas joint venture, having acquired a foreign subsidiary, landing a large foreign client, and many more. From an operation standpoint, the question is whether your institution should hire and build an in-house translation team or outsource to an external translation agencies. There are pros and cons to each option, let's discuss each of them below:

1. Translation costs

If the volume of translation is large and consistent, the overhead translation costs are usually cheaper hiring an internal translation team. However, there are often hidden costs involved with an internal translation team that get overlooked. These costs include the usual costs and expenses relating to recruitment, hiring and training, employee overhead, and excess capacity during low season when your translation team is idle (if applicable). Of the companies we surveyed who chose the route of hiring their own translation team, the top problems were all related to people: hiring, retaining, and managing talent.

In contract, outsourcing translation work to an external agency removes all the headaches of hiring and managing a team. As you would imagine, this is at a premium cost in contrast to running your own translation team. The benefits include only incurring expenses on a pay-as-you-go basis as required by a project, costs that may be factored into a project as part of its expense.

WINNER: External Translation Agency

2. Confidentiality

For institutions where the documents to be translated are sensitive and/or contains client data, confidentiality is typically one of the critical considerations when it comes to deciding between between hiring translators in-house or external. Legal and financial industries in particular, documents often contain highly sensitive and non-public information. These documents may include offering circulars, information memorandums, subscription agreements, engagement letters, research reports etc., and leakage of the content in these documents incur large liabilities. From our experience, even with the protection of a non-disclosure agreement, financial and legal institutions are often reluctant to engage an external translation agency to process their documents.

WINNER: In-house Translation Team

3. Workflow management

Hiring in-house translators makes it simpler to streamline and control internal workflows and needs. In-house teams are also much more responsive to last minute requests from your organization. This is particularly important at institutions where the work to be performed is consistent, similar, and needs some scalability. Organizations tend to gain huge efficiency and productivity benefits employing internal systems or processes designed for their organization.

That said, sometimes translation requirements may vary in complexity and are seasonable depending on the organization. This can put a stress on internal resources where it is typical to still hire for external help as required. Some external translation agencies also offer project management as part of the services, and tend to be more flexible as far as providing the right expertise or team based on the translation needs and deadlines.

WINNER: Draw

4. Technology

Based on our time speaking to various organizations, we've found it is typically quicker for translation agencies to adopt the best technology to assist them with their needs. Sometimes the sheer volume of translation an agency handles requires them to spend more time and effort discovering tools to improve their efficiency resulting in improved profit margins. The use of technology, including machine translation and AI-assisted translation software, often lead to a much faster delivery than in-house translators can manage.

SLIGHT WINNER: In-house Translation Team

The decision between in-house versus outsourced solution often depends on your organizations circumstances. It will depend on the volume, consistency of work, cyclicality and confidentiality of the translation projects. Institutional workflows are also a big reason some organizations choose one or the other. Generally speaking, whether it is an internal translation team or external translation agency, the use of AI-assisted translation tool has become the trend, and it remains to be seen how different industries will utilize such custom AI translation technology to assist them with their translation projects.