Significance of Outsourced Research Teams in Consulting
Demand for quality research in the business world is increasing sharply.Dedicated knowledge and research functions are now crucial in the consulting model. The tasks done by research professionals have transitioned to a more open, value-added research model.
A Principal at BCG says, “Centralized Research teams are crucial to consulting firms. They offer various kinds of research support services. They not only support consultants in the execution of projects, but also take care of their data, research and analysis. Consultants reach out to them on a weekly or daily basis, as needed. These research teams make consultants more productive due to their scalable and diversified nature.”
Centralized Research teams are proven to be more productive. And they assure their data privacy through Non-Disclosure. An ex-McKinsey researcher says, “Traditional ways of consulting included only one research member, an expert, and a journalist. Now we have an expanded team of researchers with diversification at every task.”
McKinsey has invested the most on their knowledge and research support. They use about 1,605 research professionals to support the organization – about 10.8 professionals to every 100 consultants. In comparison, BCG has about 549 research professionals working for them – about 5.3 professionals to every 100 consultants.
The demand for knowledge and research is only increasing. Big management consultants are investing in offshore locations to get global coverage. McKinsey established their Knowledge Centres in India in the early 2000s. Currently, they have 6 Knowledge Centres worldwide. Each centre has three groups – Generalist Research, Practice Research, and Analytics. Currently, McKinsey has 46% of its knowledge and research functions located offshore. Oliver Wyman has 41% of their knowledge and research support located offshore.
According to Martin Tronquit, the Managing Partner at Infomineo, “Leading organizations structure their research functions through three tiers – onshore operations, offshore operations and use of outsourcing partners. This offshoring and outsourcing strategy allows them to benefit from scale effects. They leverage lower costs and more specialized resources.”
Individual business consultants often use low cost, part-time freelancers to meet their research requirements. These freelancers are not always reliable, dependable or professional. They tend to have a short-term view. The consultant has to regularly train his freelancers to suit his preferred style. There are no real assurances of data confidentiality.
The work of freelance individual researchers rarely matches up to global standards. Most individual consultants just fail to scale up.
Boutique consulting firms realize the pitfalls of relying on low-cost individual freelancers. They value their partnerships with global research teams, like IBC Consultants. They can easily tap into these research teams. The benefits of better research outsourcing are:
• High-Quality Data: Expert, focused researchers better understand market trends and client requirements. They deliver high-quality research and responsibly handle consulting needs.
• Affordable: Outsourcing research is cheaper than creating a centralized research team. Leveraging the scale of their partners, the outsourcer can generate a good margin.
• Latest Research Tools: Consulting firms require access to the latest tools and databases. Access to such databases is quite expensive. Outsourced research teams can easily provide the latest data and tools.
• Risk-sharing: Both the company and the research team are accountable for the delivery to the final client. So it’s in the researcher’s best interest to deliver high quality research.
• Running Business 24X7: Outsourcing partners usually work 24X7 to match the time zones of their global clients. They can complete critical tasks within the specified time zone and send it back for review immediately.
India is the number one outsourcing research destination globally. More management consulting firms are outsourcing their requirements to independent teams from India, like IBC Consulting. In doing so, they create maximum value for themselves.