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Outsourced Analytics: What You Need to Know
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Final thoughts.  Outsourcing your analytics can be very beneficial to both sophisticated firms and firms just getting started as long as they plan their approach and manage the relationship carefully.

Prospector

This is Beth Schultz, signing off. Thanks everybody!

Blogger

Industry knowledge/competitive size up/business understanding are all really important.

Prospector

David & Peter, thanks for those last bits -- great food for thought. And thanks for a great show. 

Blogger

I've been part of such a relationship where we not just learned processes but improved and created new ones for our clients. In general, how would you view the attitude towards Nearshore or Offshore ABPO? Is my situation way outside the norm? Can I expect to form other relationships that are so open?

 

Prospector

Peter - would you count indsutry knowlesdge as a key factor?

Prospector

@Amie, you can find the MIT SMR piece here:  "Should You Outsource Analytics?" (the title is clickable, even though it doesn't look like it!)

 
Blogger

The paper is published in the MIT Management Review Winter Edition.  Thanks for your interest.

Prospector

IMHO the talent issue is not a shorrtage of pure analysts (math or engineering grads) but a shortage of MBA type analytsts who understand the functions (Mkt, Fin, HR, Ops) and also understand how analytics can create advantage in these functions.  Once you have the issue chosen, its often not to hard to do teh 'math' if you can provide strong supervison.

Prospector

Other questions: 
Where offshore?  China India Hungary
What kinds of infrastructure/tools do these providers use?  SAS Servers
How do clients get their data to the provider?  Dedicated Networks, Secure FTP

Prospector

David & Peter - I would very much like to read your paper, where can I access that?

 

Prospector

David & Peter -- any last thoughts to share with our audience?

Blogger

Looks like we're just about at the top of our hour. If anybody has any last questions, please post them now.

Blogger

@DavidF1967 -- of course, this means ABPOs may have to figure out how to grapple with the talent problem as much as anybody (at least stateside).

Blogger

I think there will be sucha demand for talent with BIG DATA that the US universities will still not be able to supply all the talent.  ABPOs should prepare for this. 

Prospector

David & Peter -- a question re: analytics talent. We hear so much about the talent shortage, which is obviously one reason companies are investigating analytics outsourcing. But at the same time, we've seen a rash of analytics-specific or analytics-related degree programs pop up in the US. Once we start pouring more degreed analytics professionals into the job market here, what impact might we have on outsourced analytics?

Blogger

Offshore has a cost savings component and a talent availability.  However, a smart firm will use all the analytic firepower which they can reasonably invest in and which can add value.

Prospector

David & Peter -- how can buyers assure "safe passage" of their data to an outsourcer?

Blogger

@DavidF1967, regarding knowing where the work is done -- do you find most outsourcers are upfront about this or will only share if specifically asked?

Blogger

Beth, I think regular scheduled meetings and onsite visits both to and from are important to build the relationships.

Prospector

BPO12013, I think its up to the outsourcers to move up the analytics value chain and have a more strategic relationship with their customers.  This will save them from the technology curve.

Prospector

@DavidF1967 -- to your point that one standout best practice is having outsourcers provide new ideas to firms on how to improve their analytics. Is this something that happens organically or through, say, regular meetings among stakeholders?

Blogger

 I just read your comment, "Many of the major offshore providers started as captives of major US companies and still do work for them," and I'm curious about that. Is that to say they work exclusively for one major US company per industry?

Not generally.  Although McKinsey does this most analytics BPOs are busy marketing wherever thay see an opportunity.

Prospector

do you think automation is a real and immediate threat to Outsourcing companies who specialize in Analytics and Reporting tasks?

Not in the near future -- the leading edge of analytics in big data and big problem solving (ie the stuiff that can really create advantage) is a long way from being automated (although bits of it might be, but that just means that you can push further).

Prospector

I wonder what % of these outsourced providers/suppliers meet or exceed contract/buyer expectations

 

Many of the major offshore providers started as captives of major US companies and still do work for them -- so many of these relationships are long term and veruy successful.   

Prospector

do you think automation is a real and immediate threat to Outsourcing companies who specialize in Analytics and Reporting tasks?

Not in the near future -- the leading edge of analytics in big data and big problem solving (ie the stuiff that can really create advantage) is a long way from being automated (although bits of it might be, but that just means that you can push further).

Prospector

I think that buyers have the right to know exactly where the work is being done.  Many firms have nearshore operations to bring the analysts closer to the business.  For example, I worked at one firm which had a nearshore operation for the US in Canada

 

Prospector

@PeterCBell -- I just read your comment, "Many of the major offshore providers started as captives of major US companies and still do work for them," and I'm curious about that. Is that to say they work exclusively for one major US company per industry?

Blogger

Thanks for your time and participation, Peter, David and Beth!

I'm also still curious about how data gets from point A to point B

majahimie - what kinds of issues have you encountered that are specific to developing economies?

One stand out best practice was when outsource providers actually provided new ideas to firms in how to improve their analytics rather than just transfer the knowledge.

Prospector

Hi David & Peter, at the show's end, Peter mentioned that an outsourcer may have an analytics team at a US office but the work could be done anywhere around the world. How aware do "buyers" need to be about where the work is getting down, for security and privacy reasons?

 

Blogger

I wonder what % of these outsourced providers/suppliers meet or exceed contract/buyer expectations

 

Many of the major offshore providers started as captives of major US companies and still do work for them -- so many of these relationships are long term and veruy successful.   

Prospector

Special Thanks to our guests Peter and David and of course to Beth for hosting the show

Prospector

As an outsourcer of Analytics myself it's good to hear the different perspectives. Would love a part II of this.

My question for the panelists is do you think automation is a real and immediate threat to Outsourcing companies who specialize in Analytics and Reporting tasks?

Prospector

I wonder what % of these outsourced providers/suppliers meet or exceed contract/buyer expectations

 

Many of the major offshore providers started as captives of major US companies and still do work for them -- so many of these relationships are long term and veruy successful.   

Prospector

what did you consider to be stand out best practice of suppliers in terms of how they engaged with their clients? Aside from the onsite trips to understand their requirements?

 

Prospector

Thanks to all for your interest.  

Prospector

Thanks! very nice topic

 

Prospector

Thanks for the insight

Prospector

Amie,

I agree with you.   The question is how to build the one team when everybody is not in one place.

 

Prospector

Hi everybody. Thanks for tuning in, and participating here. If you have questions for David and Peter, please post them now!

Blogger

this was a very informative session

Thank you for the great presentation

Prospector

I mean the analysts themselves -- like -- "we have an all-star team"

The key to that is having the client treat the outsourced firm like an extension to their own team

 

Prospector

I wonder what % of these outsourced providers/suppliers meet or exceed contract/buyer expectations

Prospector

How many companies are open to hire CIO and CAO in house

Prospector

audio is now stable.  On outsourced analytics, it gets very challenging in developing economies.   More often you have a situation where the outsourcing company employs a contact in the country of use who works like 'one-cap-fits-all' leading to broken down contracts. Also many buyers do not have good grounding in the linkages in there companies and do not know that linkage of strategy and culture across the company is key.  This is enlightening so far

Prospector

IPR is really a challenge here when you outsource analytics, maybe a seaparate discussion..

Prospector

in terms of privacy and data protection concerns

I'd imagine that financial services is a hugely fraught industry

It is good to know that they really cater customer's need

Prospector

Do outsourcers trade on the reputations of their 'data jockeys?'

It sounds like Peter's describing a hybrid approach where some analytics workloads are kept in-house. Does that happen?

Excellent questions, Gord. I'd imagine the 'talent shortage' is the primary response. 

That's a huge issue -- do these analytics providers need to guarantee certain levels of data protection? Are there fly-by-night providers that don't?

Why is there such a focus on offshore analytics capabilities versus using a domestic firm, especially considering all of the open-source algorithms and solutions that are being provided in the machine learning and analytics space?  What is the draw to offshore?

Prospector

What are the internal barriers to developing analytics capabilities in-house?

Prospector

David draws a distinction between "ordinary" analytics and advanced predictive analytics. How does this play out in an outsourcing engagement?

That's a great question - where does the outsourcing decision and management come from -- business or IT?

my audio is fine

Prospector

majahimie - maybe refresh the page? it's working great for me

audio has been chequered; not at all smooth so most of the chat is missed.

Prospector

Other questions:
Where offshore?
What kinds of infrastructure/tools do these providers use?
How do clients get their data to the provider?

 

Good Morning!

Prospector

Audience members -- what has your experience been?

Firms that are just getting started -- do they start with outsourcing, or do they arrive at that conclusion after not being able to find in-house talent?

I'm excited to hear from these two experts -- especially given their recent research

audio is up and I am using firefox

Prospector

ready for the chat

Prospector

Hi all all ready for the show :)

Prospector

Today's guests are David Fogarty and Peter Bell, authors of the recent MIT Sloan Management Review article, "Should You Outsource Analytics?" I'm looking forward to digging into this topic.

Blogger

20 minutes till start time! 

Blogger

First-time listeners, please note that the audio player will appear in the window above at start time. Click on the left arrow to launch (sometimes, you may have to do this more than once). The audio player will work better with some browsers than others, so if you're experiencing difficulties, you might try another browser.

Blogger

Hi everybody, we'll be starting today's radio show at the top of the hour, 3 p.m. ET. 

Blogger

So how often do things get outsourced and money is saved? Seems likely it would cost more in the long run?

Data Doctor

less than 2 hrs now

Prospector

Morning Everyone

Prospector

looking forward to this

Prospector

how's everyone this fine monday morning

Prospector

Morning everyone

Prospector

hello everyone

 

Prospector


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