Rebecca Ray, LISA Global Business Editor The Eastern Mediterranean, where I live, is a wonderful vantage point from which to survey the rest of the world. Most of history's greatest civilizations have ruled this area at one time or another, as their armies of soldiers or merchant traders pushed east or west and back again. One of the customs in this region involves reading the whimsical and elegant patterns made by Turkish "kahve" grounds after one has finished drinking a small cup and turned it over onto its saucer. Another coffee drinker will then turn the cup over very carefully after a few minutes, peer inquiringly inside as s/he looks for the patterns that will predict the original drinker's fortunes: fish for good luck, honey bees or ants for economic prosperity, roads for travel opportunities, birds for visitors, etc.

So, having just finished a fresh cup of Turkish coffee with my favorite neighbor, I am now ready to tackle the assignment of predicting the possible affects of certain global business/marketing issues on the GILT industry for 2003.

Prediction 1: "When one door closes, another opens."

Here's the doom and gloom, using the U.S. high-tech sector as the bellwether. According to a survey of 100 CIOs (chief information officers) at leading U.S. companies conducted in December, average spending on hardware and software will decline by 1% compared with 2002. And perhaps even worse, the percentage of those expecting to delay higher IT spending until 2004 or later has jumped from 26% in an October survey to 43% in December. [1]

Action Item for the GILT Industry: "Aim Your Laser Beam."

Sooooo, where's the "open door" in all of this? I offer the following three opportunities, though there are many more:

Where is the growth occurring?

Determine precisely where (by region, sector, size of the organization, etc.) growth is occurring. Then focus in on it with a laser beam. For example, IT spending may not be growing as it did for most of the 1990's (how could it?!), but almost all organizations are spending to maintain their infrastructure. What are the top priorities for CIOs in the U.S.? Applications integration, security and ERP (enterprise resource planning) upgrades. In an August 2002 survey of 225 CIOs by Morgan Stanley, a very large number of respondents (80%) had launched new development projects during the year. [2]

Two other growth areas include e-commerce initiatives and Linux implementations. The e-commerce initiatives are important for the GILT industry for two reasons. Due to the organic nature of the Web, a company is almost always, by default, pulled into selling outside of its home market(s) when its products/services are offered over the Internet.

Second, e-commerce means content, and content means languages, and languages mean GILT! According to the Online Publishers Association, we surfers spent more than US$ 1 billion for online content in 2002, almost double the amount that we spent in 2001 (and this in a down economy). These numbers do not include the even larger revenues from pornography and gambling. [3]

Once you have determined where growth is taking place, identify the organizations landing the contracts, producing the product/service, etc. Then figure out if there is a product/service that your particular company (either currently in your portfolio or one that can be developed quickly) can offer to one or more of the parties in the transaction.

Aim Your Laser Beam

Zero in on those (potential) customers that are beyond the stage of focusing simply on surviving, and who are now actively pursuing a strategy of capturing new growth opportunities. Here's how you can quickly identify these organizations:

Watch for (1) companies acquiring others; (2) sectors in which the regulatory environment is changing; (3) markets in which customer attitudes are changing and providing openings for new products and services; and (4) companies that are revamping their organizational cultures to implement international best practices. [4]

To end this prediction on a much more positive note than it began, I offer the following anecdotal evidence that the GILT industry is by no means retracting. A quick search this week on HotJobs.com revealed the following:

KEYWORD	NUMBER OF JOB POSTINGS
International Marketing	264
International Sales	221
Translation	141*
Localization	51
Europe	37
Asia	23
Japan	18
Internationalization	16
Globalization	12
China	11
Latin America	3

* A few of these listings are not linguistically related (e.g., "foreign currency translation").

For a U.S.-centric job posting service, the results are quite encouraging, especially when one considers the total number of positions directly related to GILT (220).

I took a few minutes as well to review international job content for two high-tech companies, Google and eBay. The former's internationally-related job listings totaled 8% (three out of 37), including one for an Assistant International Webmaster (which means that there must already be at least one International Webmaster) and one for an International Business Analyst.

In the case of eBay, international job listings represented almost 13% of this week's total (15 out of 109). In addition to several localization-related positions, there were openings for a Director of International Products and a Manager and a Director for Global Metrics.

And then there is China...

Prediction 2: "This Century (Not Decade) Belongs to Us, and We Know It!"

Everyone knows that China is the place to be for manufacturing and research and development for many sectors. It is important, though, to understand why because the reasons affect how one chooses to enter this market.

China has been an economic and technological (ergo, my "china" coffee cup) superpower in the past and is confident that it will be so again very soon. At every level of Chinese society, this is the overriding goal. People can taste it, and they want it very, very badly. The country has definitely emerged over the past year as a global leader in technology, both as consumer and producer.

Since this tremendous thirst for growth has its roots in the people themselves, rather than being imposed only from the top down, there is no end in sight yet. As W. T. Tan, President of Intel China points out, "The PC penetration rate is below 5 percent. This is still very much a growth market. China is still in love with technology." [5] And for now, U.S. products are still popular and sought after.

To rephrase it in terms that are perhaps more tangible: the city of Chongqing is now the world's largest with 31 million inhabitants, and every major city in China has one or more Silicon Valleys. According to Lawrence J. Lau, Professor of Economic Development at Stanford University, the Chinese economy has grown by 10.9% annually since 1979. He predicts that it will continue to expand by 7% annually for the next several decades, regardless of economic conditions in the rest of the world. This means that its GDP will equal that of the U.S. by 2035. [6] Where else in the word today do so many people work their regular jobs during the day and then return home to run independent businesses?

Unlike the "Asian Tigers" in earlier days, export markets are important, but not critical, to China's continued growth. The domestic market in China is so huge with such high levels of unmet demand that, in the short term, this region will not be affected by the current external economic downturn nor much by a possible (limited) war in the Middle East.

Software development will soon boom in China. The government is now enforcing its crackdown on piracy as a member of the World Trade Organization, and development talent is excellent. The sales of legal software are expected to grow 36.7% annually through 2006 when it is projected to be US$ 7.8 billion. In addition, the Internet will continue to drive PC sales and to have a greater influence than in most of the rest of the world because TV content in China is very limited. [7]

Action Item for the GILT Industry: "Don't Miss the Boat!"

All major companies have manufacturing bases in China, and the ones who do not currently have research facilities are scrambling to set them up to have access to the extremely high-quality people available. If you are a GILT services provider, you need to adapt to meet the needs of your customers as they expand further in this all-important region.

No matter the size of your organization, if you haven't fully developed a strategy for China and/or identified and entered into strategic partnerships for this region, move it to the top of your TO DO list and that of each one of your top managers today! As you do your planning, integrate the "China piece" into the rest of your company's global business strategy. Then, ensure that your most valuable partners and customers have developed and are implementing their own strategic plans for China. If they are struggling and need help and guidance, provide it to them or lead them to people who can.

Prediction 3: Web Services Is Closer to Reality Than Many Realize... It's Not All Hype

As with almost every technical innovation, Web services [8] is not revolutionary, but rather evolutionary, built on all of the previous work in networked computing. It won't save the world, but it should remain on your radar screen throughout 2003 for the following reasons:

Enterprise software providers such as BEA, IBM, Microsoft and Sun are racing to integrate Web services capabilities into their product lines. The war over standards will heat up as companies move closer to delivering real enabling applications. The race has begun to determine which company will create the most popular programs for network-based software. [9]
There is a vast amount of data that business, organizations and governments cannot use because it is simply not easily accessible to normal users. People such as Esther Dyson are predicting that making this information easily available to interested parties both within an organization and without is the major IT task for the next few years. This activity may very well lead the recovery in high-tech. [10]
At some point in the not-too-distant future (how's that for a precise prediction?!), customer relationships in the business-to-consumer (B2C) sector may change dramatically. This is because Universal User Profile (UUP) providers are expected to gain control of access to customers through their control of passwords, credit card information, etc. Watch Microsoft (Hailstorm/Passport) and Sun, et. al. (Liberty Alliance) slug it out in this arena.
The biggest challenges remaining for Web services are security and consumer privacy. Once these are hammered out, Web services will become attractive and useful to the world-at-large.

Action Item for the GILT Industry: "Remain Vigilant."

Assign someone in your organization to stay up-to-date on the developments in this sector during 2003 from both the technical and business implementation points of view.
If you have the bandwidth, ensure that your organization becomes active in the efforts by OASIS (Organization for the Advancement of Structured Information Standards) to define how XML [11] will accommodate the needs of the GILT industry.
As Web services projects roll out this year, keep an eye on the smaller- to medium-sized enterprises that act as the intermediaries for large vendors and their installed bases. [12] There may very well be GILT-related business opportunities, as data is made accessible across corporate, language, etc. boundaries.
Prepare during 2003/04 to implement those pieces of Web services that apply to servicing your customers in 2004/05. Teach your organization not to lose sight of the real goal in all of this: the business context of what your (potential) customers need.

My coffee grounds are beginning to run together . . . Open Source (if Microsoft is forced to take it seriously, so should the GILT industry), Latin America, India, security issues, games, GILT pricing . . . I will revisit all of these topics in future articles throughout the year.

A peaceful and prosperous New Year to all of you, or as they say in Turkish, "Nice Mutlu Yillar!"

[1]Alorie Gilbert, Discouraging Signs for IT Rebound, CNET News.com, January 2, 2003.

[2]Larry Dignan, Survey: Linux Growing, CRM in Doubt, CNET News.com, September 4, 2002.

[3]Daniel Tynan, Six Predictions for 2003, CNET News.com, January 6, 2003.

[4]Dominic Barton, Roberto Newell and Gregory Wilson, How to Win in a Financial Crisis, The McKinsey Quarterly, 2002 Number 4.

[5]Michael Kanellos, Power of the People, CNET News.com, July 9, 2002.

[6]Michael Kanellos, Power of the People, CNET News.com, July 9, 2002.

[7]Michael Kanellos, Power of the People, CNET News.com, July 9, 2002.

[8]Web services are business and consumer applications, delivered over the Internet that people can select and combine through almost any device from PCs to mobile phones. Without user intervention, Web services are designed to allow disparate systems to share data and services. In short, data interoperability. Web Services: Why Care?, CNET News.com, March 31, 2002.

[9]Eric Schonfeld, What the *&%$@!! Are Web Services? (And Why You Should Care), Business 2.0, February 18, 2002.

[10]Esther Dyson, It's the Information, Stupid!, New York Times, October 16, 2002.

[11]XML, "Extensible Markup Language," tags digital content in standardized formats and has become the lingua franca for Web services.

[12]Esther Dyson, It's the Information, Stupid!, New York Times, October 16, 2002.

Rebecca Ray (Rebecca@lisa.org ) has spent her entire career teaching technical and business people how to develop their globalization reflex (thanks to LISA's own Andrew Joscelyn for this very apt term!). She has been a pioneer in designing, testing, adapting and marketing software outside of the U.S. for companies such as IBM, Netscape Communications, Symantec and Sun Microsystems. She also has a strong background in machine translation and terminology tools, and is the co-author of the book, Doing Business in the USA: Marketing and Operations Strategies for Success. Rebecca is fluent in English, French, Portuguese, Spanish and Turkish.

Reprinted by permission from the Globalization Insider,
15 January 2003, Volume XII, Issue 1.1.
Copyright the Localization Industry Standards Association
(Globalization Insider: www.localization.org, LISA: www.lisa.org)
and S.M.P. Marketing Sarl (SMP) 2004