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8 Advantages of Outsourcing Data Analytics: Get More from Your Data

Data analytics is increasingly becoming an integral part of any business. Irrespective of the industry or the scale of business, it is important to have a strong foundation in data analytics. With the rising amount of data being generated from various sources, its effective use is critical for success.

Businesses often find it challenging or overwhelming to put in place the mechanisms for effective data management. It can be due to the current priorities, lack of technical expertise, or due to lack of time. The fact remains that the business is unable to harness the capabilities of data. Some companies opt to outsource data analytics to ensure that the focus remains on core activities and the organization is still able to move ahead with the times.

The global data analytics outsourcing market stood at $3 billion in 2021. It is expected that the market will grow at a CAGR of 21.50% over 2022-2030, reaching a valuation of $70.68 billion by the end of 2030.

Outsourcing data analytics can bring a variety of advantages to a business. Apart from being able to access the latest solutions, there are several other benefits of outsourcing big data analytics to a professional partner.

What is Data Analytics?

Data analytics is the science with which a business can utilize raw data to derive meaningful insights and conclusions to support business growth. Data analysis can help a business increase productivity and performance in a variety of areas like marketing, logistics, finance, sales, customer service, etc.

Data analytics help a business gather data from various sources and uncover patterns that can help generate useful insights. With the right frameworks and structure, data analytics can emerge as a strong competitive advantage for any business.

Why Should You Outsource Data Analytics?

We are living in the era of outsourcing. Businesses are outsourcing all types of IT and business functions, including strategic processes. The reason for outsourcing data analytics can be different for each business. However, at the core, it is important to understand that data is already playing an important role in business operations and its prominence is only expected to grow further. As a result, all businesses need to consider data analytics as an important aspect.

With the evolving technology, businesses utilize software systems with modern technologies like artificial intelligence, machine learning and automation capabilities. Establishing these systems from scratch in an organization can be time-consuming, expensive and challenging. However, with data science outsourcing, any business can make the most of the evolving technological trends and stay ahead of the competition.

Key Advantages of Data Analytics Outsourcing

Outsourcing data analytics has the potential to accelerate the growth of any business. Here are the key advantages:

1. Professional Assistance

By deciding to outsource data analytics, a business has a chance to access skill sets that may otherwise be in short supply in the market. It is a known fact that talent is in short supply in the IT industry. As a result, a business is better placed to have access to professionals who have deep expertise in areas like cloud computing, advanced analytics, big data, data science and data lakes. A business can close the gap in the skillset landscape by outsourcing data analytics.

With the explosion in the volume of data across structured and unstructured sources, a business can’t meet its increasing requirements using a traditional data center setup. Businesses need modern cloud platforms so that they can build data lakes and manage data loads. However, it becomes challenging to operationalize these changes with an in-house IT team that offers limited talent and skill set. Outsourcing the data analytics function can expand the net of skill sets available for business growth.

2. Industry Expertise

While some analytics functions are universal, some industry-specific functions can prove to be critical in effective data management. For instance, sectors like healthcare and financial services can have specific analytics functions that are required to build capabilities in the area of data analytics. Therefore, getting an industry partner that has deep expertise in that particular sector can help accelerate the data transformation journey for a business.

For instance, a partner that has the capabilities to deliver high-quality data analytics service in the retail industry will be able to build analysis points like customer lifetime value analysis, market basket analysis, store sales analysis and profitability analysis. In other words, the partner will be able to bring to the table techniques that are very specific to the retail industry.

At the same time, by opting to outsource data analysis, a business can benchmark its growth against its peers or the industry in general. Over time, this can emerge as a solid competitive advantage for any business. 

3. Easily Scalable

Apart from the fact that outsourcing services can help a business achieve data analytics skills quickly, it is equally helpful in creating a scalable ecosystem that may otherwise not be easy or possible to create with in-house capabilities.

Effective data analytics requires a level of scalability and complexity that may not be possible to achieve in-house. As a professional data analytics partner will have analytical assets like frameworks and accelerators, it is possible to scale the data analytics processes quickly. With a third-party handling data analytics function for a business, it is also easier to follow a quick path to analytics maturity in a business.

4. Ensuring Compliance

With the increasing amount of data, it is becoming increasingly important for businesses to comply with various regulations regarding data capturing, processing, storage and usage. With a professional data analytics partner on your side, the business is better equipped to understand and handle compliance requirements.

Businesses need to create easily audited data which can be achieved much more easily with an external outsourcing partner. For instance, with the General Data Protection Regulation (GDPR) and other similar versions in other markets, a business must be on the right side of the law to ensure seamless functioning.

5. Greater Use of Data

It is often said that data is the new oil. With its increasing importance, there is a possibility to leverage data effectively for business growth. As machines have adopted the role of processing data, the entire value chain of data and analytics has undergone a massive shift. As a result, outsourcing data analytics is the need of the hour for several businesses that are looking at making greater use of data in business operations.

A professional partner can improve the level of involvement of a business towards data management and uncover new uncharted paths that could prove to be critical for long-term success.

6. Faster Results

Time is of the essence in the modern world that we all live in. Businesses are looking for faster and more effective results. By opting to outsource data analytics, you have a better chance of achieving faster results. This is not because the outsourced team is good at time management but mainly because you did not have to spend time setting up the ecosystem and onboarding & training the team.

It can also be new territory for the business while it is day-to-day operations for the selected outsourcing partner. At the same time, the outsourced partner is spared from irrelevant meetings and company-wide presentations that can hamper the productivity of an in-house team.

7. Focus on Core Activities

Opting to outsource data analytics can free up resources for the business to focus on its core activities. Whether it is a start-up, a medium-sized business, or a giant conglomerate, it is important to have the right priorities and focus on the core activities of the business.

As you outsource data analytics, it is possible to keep an eye on the long-term vision of the organization and at the same time, rely on professional experts to accelerate the digital transformation journey.

A business is better placed to grow in its core domain rather than following a hit-and-trial strategy in establishing data analytics.

8. Lower Costs

Outsourcing the data analytics function is more cost-effective as compared to hiring, managing, training and maintaining an in-house team of employees. As the outsourced partner can achieve economies of scale or may have lower costs of operations, a business can spend less money for better capabilities in the area of data analytics.

At the same time, the global nature of the data analytics business enables you to select a partner from any part of the world which can even reduce the cost further while maintaining the quality of services.


The what, why and when of outsourcing data analytics can be different for all businesses. However, as explained above, it has the potential to bring in several advantages. One of the biggest rebuttal counter viewpoints against data analytics outsourcing is the need to have adequate control over the data management processes of the organization.

A business can set up the processes in a way that there is a balance between control and democratization of data. The data analytics partner can provide the much-required guidance on setting up the governance and access layers following the end objective of the business.

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