Online Extra: No. 64: SDL


Sales: €88.6 million

It's unlikely that you would ever catch Mark Lancaster at an anti-globalization rally. Au contraire, the 43-year-old founder and chief executive officer of SDL International has hit paydirt thanks to the ever-shrinking planet. His Maidenhead (Britain) company is one of the world's top providers of language-translation technology and services, with sales last year of €88.6 million and pretax profits of €7.4 million. Although 2004 results were down 2.6% because of currency effects, SDL's revenues have doubled since 2000, and are up 11% so far this year. Staff levels have grown 20% since 2003, to 1,400.

Founded in 1992, SDL grew from Lancaster's experience tailoring software for international distribution at Lotus Development and PC database pioneer Ashton-Tate. The job was expensive and "always took longer than expected," he says. So, with backing from angels and later €5 million in venture capital, he started SDL to offer clients cheaper, more efficient translation of everything from brochures and documentation to the on-screen menus in software programs.

SDL now has more than 50 offices around the world from Detroit to Dubai, and counts among its hundreds of customers giants such as Philips Electronics, Sony (SNE ), Microsoft (MSFT ), Procter & Gamble (PG ), BMW, and Morgan Stanley (MWD ). "As globalization increases, the need for local content can only get bigger," Lancaster says.


  Belief in SDL's prospects has fueled a 38% jump in its London-traded shares this year, even as larger U.S.-based rival Lionbridge Technologies' stock has flatlined on lowered sales and profits. "SDL is doing better because it has significant in-house technology that lets its translators be much more efficient," says analyst Carl Franklin, who follows software for London brokerage Bridgewell Securities.

The secret is actually a savvy blend of technology and elbow grease. SDL uses computers for the initial translation, but human experts check the documents to ensure accuracy and idiom. To minimize rework and ensure consistency, SDL's software memorizes key words and even suggests corrections when set phrases are misused by writers.

Such automation helps cut the time required for translation by up to half -- and the cost by 40%. SDL's networked systems also manage the entire translation process, routing documents automatically through defined steps such as editing and final approval. In an increasingly global world, Mark Lancaster seems to have hit on a winning formula.

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