High-end outsourcing: Where past experience influences perspective

Published on March 26, 2013 by Guest Blogger

In the past 3-4 years, a trend has emerged, with most of our new clients treating knowledge-based outsourcing as an enterprise-wide initiative and not just an ad hoc exercise. These firms have approached the initiative from a holistic standpoint to balance research and front-office needs with resource constraints. But, what role do these firms believe an outsourced team should play?

Our Fixed Income and Credit Research team recently conducted a survey of buy-side credit teams. Among the respondents, 40% of firms had already used outsourcing support, while 25% were considering using outsourcing support. The rest were yet to consider high-end outsourcing.

We asked respondents whether they believed outsourced teams should a) take part/complete ownership of tasks that may include high-end analytics, idea generation, and final form research, or b) play a subordinate role to the in-house team on tasks that may generally be repetitive data collection and basic analysis.

Our survey showed that the response was largely influenced by the history of the firm’s use of high-end outsourcing.

About 70% of firms already using outsourced research support wanted the outsourced team to take part/complete ownership of certain research processes. On the other hand, more than 80% of those only considering the use of outsourcing indicated they would like the outsourced team to play a subordinate role to their in-house team.

While the response seems intuitively correct and a natural outcome of positive experience, we had not anticipated such a stark difference in opinion.