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29 (124) 2017
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HR & Professional Qualifications

Better English means higher profits – true or false?

by Ewelina Piorun, exams business development manager, British Council
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Do your employees know English well?  We talked to senior managers across Europe to find out how English skills of their employees impact key business areas.

From our conversations with partners and clients we observed a gap between the increasing importance of English in the marketplace and the strategies and tools required to meet this challenge. Often businesses do not have sufficient knowledge of the English skills of their workforce and job applicants. We wanted to examine this issue and use our expertise to help companies turn language skills from an area of risk into a business asset. Why does English matter? Here are our findings.

Business intelligence

Poor English can prevent managers from keeping up with industry trends and participating in international seminars, trade conventions and other promotional events. It may mean your company misses out on new market opportunities, harms its reputation or fails to adapt to changing market trends. For example, if traders in large German banks do not keep their business knowledge of international markets up to date, 75% of revenue generated by their investment banking divisions could be at risk.

Supplier cost

Supply sourcing directly affects a company’s profit as well as its ability to price competitively. Limiting the company to domestic suppliers only can lead to higher supply costs. Most companies look to site production in low-cost countries and source raw materials in bulk from the lowest-priced seller. The importance of English in these cases is not only linked to sales, but also to costs. For example, in Italy’s manufacturing industry, knowledge of English was estimated to reduce costs by 50% by enabling firms to choose the lowest cost suppliers and buy directly.

International projects and tenders

Good knowledge of English can be a critical factor in foreign trade as it can maximise a company’s chances of winning a lucrative contract, improve their position during negotiations and reduce their bidding costs. Data from GUS, Poland’s central statistical office, shows that Polish entrepreneurs have intensified cooperation with western European countries and are finding more and more new markets. As a result, in 2016 Poland recorded a positive balance of foreign trade turnover of over 20 billion złoty. Poland already has more than 60 companies that operate globally. The international expansion of Polish companies is one of the drivers for companies to invest in their employees’ English skills.

International investments and sales

Expanding beyond local markets requires marketing and sales departments that can communicate effectively with international clients – and a high level of English is essential. For example, for Italian banks, trading on international markets is an important driver of growth and it also helps to diversify risk; companies buy and sell foreign funds for domestic as well as international clients. In total, around 30-40% of managed funds is international meaning that English contributes 30-40% of revenue through this channel.

Brand value and customer satisfaction

Our research confirmed that poor English can deeply affect how international customers perceive a company’s brand. A good international brand image increases the perception of quality and industry leadership which is critical to winning clients. To keep clients coming back, it is essential to have a customer service team that can serve them well in English. Employers are well aware that English is crucial for international client satisfaction and 66% of them require English as an essential criterion during recruitment. In Poland, a waiter who communicates well in English with diners earns four times higher a salary than their colleague who does not speak this language.

Internal communication and teamwork

Due to the multinational nature of many projects involving teams in different countries, seamless teamwork also depends on quality English. The consequences of a simple misunderstanding can be costly, leading to inefficiency, higher direct costs and even accidents. Knowledge of English as the ‘modern Latin’ is a must, mainly because this is the language connecting people from the same organisation working in disperse teams around the world. In the IT and consulting sector in Russia, developers from different countries regularly work together on projects – 65% of internal communication is in English for international companies in this sector.

How to assess your employees’ English skills

From our nearly 80 years’ experience providing training and assessment we have observed many different ways companies currently assess the English skills of their employees. All of them provide some evaluation of the level of English knowledge. However, there are some substantial risks and drawbacks.

Do not…

  • rely on brief conversation in English – it evaluates only the conversational ability of the candidate, leaving their writing and reading skills untested, and it does so on a very basic and unreliable basis

  • use tests that are not backed by research – many companies use English tests designed locally or in-house. These tests haven’t been carefully trialled and therefore risk producing biased, incomplete and unreliable results

  • test your employees with basic online tests as it can produce only a snapshot of a candidate’s English skills that is too broad and does not include speaking or writing skills.

Do…

  • ensure that employees across all levels of your company have the right English skills

  • use reliable testing with specific benchmarks, backed by thorough trials and academic research

  • when recruiting, choose English language tests that can give you a full profile of the candidates’ skills – speaking, writing, reading and listening

  • map your employees’ English skills to an international standard

  • choose tests that show precise language skills gaps to best design and assess training programmes.

Does your business have the English skills needed to compete in the global marketplace? To find out please read the full version of the report available at www.britishcouncil.pl/en/download-ebook-english-companies-aptis.

 

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