BRITISH FIRMS MAY BE LOSING OUT ON VALUABLE EXPORT SALES BECAUSE OF THEIR LACK OF FOREIGN LANGUAGE SKILLS
Internationalisation or activity in export markets by UK organisations is becoming a more common feature. This behaviour is being driven by many factors: the potential for extra sales, the desire to achieve greater profits, the desire for growth, the search for increasing economies of scale, the intensity of competition in domestic markets, the saturation or shrinkage of domestic markets, the reduction in international trade barriers and the formation of international trade alliances, (Leonidou, 1995, and Bender, 1996).
Internationalisation, however, is not confined to large organisations such as British Petroleum, British Telecom and the like but is also an ever increasing strategy operated by small and medium sized enterprises(SMEs). Small manufacturing firms might be expected to be active in external markets but service orientated small firms such as those selling product design, management consultancy, financial services, market research and computer software are also becoming involved increasingly in foreign activities, (O'Farrell et al, 1998).
The route by which SMEs enter international markets however, is subject to great debate. Johanson and Vahlne (1977) amongst others suggest that SME internationalisation follows an incremental path in terms of increasing knowledge, commitment and investment, however, Coviello and McAuley (1996) and Coviello and Munroe ( 1997), argue that the approach is more haphazard and unplanned. Although debate continues in this area, one feature is quite evident; export activity by SMEs has increased noticeable since the advent of the Single European Market, (Grant Thornton, 1996 and Cosh and Hughes, 1996).
LANGUAGE USE AND COMPETENCE IN EXPORT MARKETS
Although export activity has grown and English is seen as the prevalent European language of business, British firms may be losing out on valuable export sales because of their lack of foreign language skills (Hagen 1993). Schofield, (Independent on Sunday, 1998) notes that an Institute for Employment study investigating 2000 firms found that, "60 per cent of firms conduct business with foreign-speaking clients, and that 23 per cent say that a lack of a particular language is a barrier to business in certain countries". A survey of small-and medium sized businesses by the Centre for Information on Language Teaching (CILT) also found that one-third of UK exporters lose out on trade opportunities because they have poor language skills.
In terms of training, however, language skills are one of the lowest priority areas for senior managers. The Industrial Training Society reported that foreign languages and international competitiveness were the topics with least priority for training of senior managers, (Schofield, 1998). These results confirm that of Bell et al (1996) who note in their study of SMEs in Sussex that respondents did not feel that a knowledge of a foreign language was essential to carrying out business in overseas markets, since the majority of transactions are undertaken in English. Nonetheless, the need for better language training has been recognised by the Department of Trade and Industry (DTI) which seeks to promote language training for exporting firms through their "Languages for Export" campaign awards. In this respect the DTI also recognises the special needs of small firms by providing a special category of award for small firms.
Hagen, (1993), has pointed out that there are still gaps in the knowledge with regard to language training within small firms, in particular drawing attention to the lack of information about how small firms deal with the issues of training for languages. This article seeks to consider the strategies SMEs adopt for language training, the problems they face and whether SMEs are doing enough in terms of language training and achieving language competence to improve their competitiveness in international markets. …