Should You Outsource Analytics? Harvard Case Solution & Analysis

The surge of interest in big data has led to growing demand for analytics teams. Making teams that are such, nevertheless, is not easy. To begin with, many businesses do not have the in house wisdom and expertise required to put together a world-class analytics team. What is more, the labor market for analytics professionals has developed escalatingly tight. The dearth of analysts, particularly those capable of developing and leading world class teams that may enable a business to develop a competitive advantage from its data and analytics, is driving organizations to consider outsourcing their analytics tasks. Analytics is the latest in a string of actions businesses are outsourcing to business process organizations (BPOs). It draws heavily on statistics knowledge and mathematics, and lots of analytics-oriented BPOs have operations in India. While some firms have world-class analytics capabilities in-house, the authors introduced the question: Can an analytically naave business "purchase"world class analytics functions by hiring outside experts? The authors studied both four multinational companies that used four analytics BPOs and one or more offshore analytics BPOs.

"The analytically challenged businesses saw analytics BPOs as a way to acquire the resources and training needed to manage and do their analytics and to get quick access to important insights. By contrast, the analytically outstanding companies desired to expand their internal analytic abilities, in part because they desired to maintain their ability to develop and protect intellectual property; they tended to use offshore BPOs to perform low-level analytics. Based on the authors, the top analytics BPOs have core competencies that go beyond what most businesses can perform with internal teams independently. They inform businesses working with analytics BPOs to be clear about who does what, who owns what, how each party can use the information it has and what happens to knowledge and the information in case the BPO is got.

PUBLICATION DATE: January 01, 2014 PRODUCT #: SMR470-HCB-ENG

This is just an excerpt. This case is about STRATEGY & EXECUTION

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