The new division will evaluate whether workflow orders from clients-generally analysts, investment bankers and advisors-should be outsourced or fulfilled domestically, and will also oversee the training of offshore workers, negotiate worker contracts and supervise quality control, as well as offer a vendor management service for negotiating contracts for data services used by offshore centers.

The research requests can be broken down into three levels: level one involves "pick and pull" research, which may involve compiling a selection of press releases or articles. Level two requires using a variety of resources to gather information, and an evaluative understanding of the right kind of data-for example, to provide an industry overview. Level three, which is currently not required of offshore centers, includes more complex analyses and may involve conducting expert interviews-which BST would perform for the client-to draw conclusions from the information. One of BST's roles will be to consult with end-users to understand their needs, and determine whether to send the request to an offshore center or to conduct the work using BST staff, based on the level of research and expertise required.

The new division will be headed by Pam Rollo, currently global marketing director at CheckPoint Systems, who will join BST as managing director of business intelligence on Dec. 1. Rollo, who was involved in planning the division, has worked in information services for more than 30 years, including at Credit Suisse First Boston, where she was director of information resources, as well as at Lexis-Nexis and the New York Public Library.

Susan Edmands, who joined BST in August as a senior market data consultant from FIND/SVP, will work under Rollo as well as on other projects for the firm.

Bill Noorlander, partner at BST, says the consultancy plans to have a defined offering by March or April of 2009, with an alpha client in testing by April, and hopes to launch the service by mid-2009.

Noorlander expects the new business to double BST's overall staff count and client accounts beyond its current market data optimization focus by the end of 2009.

BST began developing the new division after a research project the firm conducted for an investment bank earlier this year to determine the return on investment of outsourcing research to India. The perception was that the return would be high because space and resources are cheaper, and would save time because the different time zones enable work to be completed overnight.

However, according to BST's findings, the return was significantly lower than expected. The attrition rate was high, and initial and ongoing training took longer than anticipated, while workers accepted the work without necessarily comprehending it, and lacked understanding of where to find the appropriate data and what data should be used, Noorlander says.

Additionally, the results were of lower quality than anticipated, as the workers provided information that did not meet the client's needs, and forced them to either finish the work themselves or ask for the research to be redone, which not only incurs a cost in terms of time and lost productivity, but also adds to content use by the offshore center, and can prompt vendors to increase their rates at contract renewal, based on the higher offshore usage.

To ensure research quality, BST will train offshore workers to minimize re-dos, by finding experienced trainers, creating a template curriculum for understanding the initial requests to help offshore staff become trainers, and by coordinating with data providers for training on their content offerings and how to use their products, Rollo says.

Vicki Chan, Waters / Inside Market Data