Outsourcing Data Analytics - Proceed with Caution

I read a recent article describing how organizations are beginning to outsource some of their data analytics functions. Given the tight market for data specialists, outsourcing this function may seem like a good idea. While there are certainly benefits to outsourcing data analytics, organizations must be care and determine when outsourcing is advantageous and when analytics should remain in-house.

Outsourcing part or all of a data analytics process can make sense. For instance, organizations may wish to outsource part of the data analytics process in order to gain access to large sets of external data that may be combined with their own data. Or, an organization may choose to outsource an entire data analytics process to support routine operational processes like fraud detection, customer purchase predictions, etc. These data analytics practices are more common and, while very advantageous, do not really offer much differentiation since most organizations are likely to have a similar practice. Also, outsourcing may make sense when these functions can be easily segmented from internal process, moved outside of the organization, and integrated with the rest of the business processes.

Where I have issue over outsourcing data analystics is when either unique and strategic business data and knowledge is required in the analysis or anytime organization-specific knowledge is needed to design, conduct, and interpret the data analysis. First of all, organizations risk losing competitive advantage if they move strategic data or knowledge outside of the organization. The outsourcing agency may be able to learn from these proprietary methods or data and apply it to your competitors analytics practices. Even with confidentiality agreements, some knowledge may leak and find its way to your competitors. It is best to keep these more strategic analysis practices in-house.

Secondly, data analytics requires knowledge of the organization's business processes, business rules, data dictionary, and other insights. This knowledge is often specific to the organization and gained through experience and applied through contextualization. Outsourcing agencies will not be able to apply the same level of wisdom available through in-house analysis by experienced analysts.

Organizations should consider outsourcing as a means to gain greater access to data and expertise while carefully determining when it is more appropriate to keep the data analytics processes in-house.

Project Change Management Workshop

Yesterday I presented a project management workshop at our Brainerd campus on the topic of Project Change Management. This is the same workshop I presented earlier this year at our St. Cloud campus.

When we discuss this topic at the workshops it is clear organizations are encountering issues with project change and are challenged in renegotiating the project variables (scope, budget, and schedule). One of the goals of this workshop is to help the participants develop a small-scale change management practice to facilitate the renegotiation of the project variables as change occurs.

The project change management process we cover may not address all change issues but it is a start in improving the flexibility of the project team to address change while still meeting the scope, schedule and budget expectations. We can use this change management process as a means to monitor for change and make adjustments to accommodate change.

Small-Scale Project Management Practice

Last Friday a colleague and I presented at the 2014 Minnesota Social Services Association conference in Minneapolis. In this presentation I introduced a small-scale project management practice for the audience to adopt in their own work. The purpose of this small-scale practice is to encourage people to begin using project management to help make them more effective in their work without having to incur a lot of overhead managing their project documentation.

Here is a copy of our presentation...

http://www.slideshare.net/brandonolson/project-management-in-health-and-human-services