Member Article

Language and communication skills in SMEs

Andy Bailey, head of strategy and CMO of EF Education First, comments on the recent Economist Intelligence Unity (EIU) report: Competing across borders - How cultural and communication barriers affect business.

Recently released figures demonstrate the news most of us were dreading - the UK is heading into a double-dip recession. As the cornerstone of Britain’s economy, it is likely more and more SMEs will need to look to the developing world in search for new customers and trading opportunities. As SMEs look to expand beyond the borders of Britain, communicating and collaborating with customers, colleagues, suppliers and partners will be pivotal for success. In fact I’d argue it is the key enabler of international trade, growth, corporate efficiency and communication.

In a survey commissioned by EF in partnership with the Economic Intelligence Unit (EIU) of nearly 600 executives from across the world, almost half (49%) admit that communication misunderstandings have
stood in the way of major international business deals and therefore resulted in significant losses for their
company. Language and cultural differences are therefore proving to be major barriers to businesses succeeding on an international level. We see this as a problem especially for companies who are making their first foray outside their native market, with almost two thirds (64%) saying that differences in language and culture have made it difficult to gain a foothold in foreign markets.

There is an up-side though; as Brits, we are at an advantage because the majority of executives from around the globe deem English to be the international business language, followed by Mandarin and Spanish. While this gives us a head start,’ we must still work hard to ensure our staff are communicating
effectively and adapting to cultural barriers if we are to expand our horizons internationally. Despite business executives acknowledging this problem – there is a gap between this recognition and actually taking action to address it. Despite almost 90% of executives stating that if cross-border communication same executives admit that there is a distinct lack of training to hone their employees’ language and communication skills.

The consequences of such inaction can be seen in many places, for example, a few British banks including Santander moved their call centres from India back to the UK last year to reign in miscommunication and customers’ frustration, presumably at a huge cost to their business.

So where does this leave us?

It’s now or never. Britain’s SMEs must look to expand outside of the UK and work with companies in emerging markets to bring the UK out of this double-dip recession. If not, they will lose out on significant
opportunities that their competitors are cashing in on - almost nine in ten respondents thought their company’s number of overseas clients will increase in the next three years. The time is now to focus on language and communications training for employees and new hires.

This was posted in Bdaily's Members' News section by Andy Bailey .