[GUEST POST] Outsourcing Analyst Relations: A viable option? by Fred McClimans

By Fred McClimans / Current Ventures (LinkedIn, @fredmcclimans)

Last week I participated in an interesting discussion regarding influence and the role of analyst relations (AR) – specifically around the issue of how AR staff could increase their influence through a variety of different mechanisms or channels. But one key point that kept creeping into the conversation was one of limited resources: “we simply don’t have the staff to aggressively pursue everything that we would like to accomplish” (a point echoed by many in smaller or fast-growing firms).

After a bit of digging, two basic issues kept making their way into the discussion: a lack of full-time resources and a lack of “R”-level funding (which is often split between Analyst Relations, Investor Relations, Public Relations and Marketing).

That said, there seemed to be a general consensus that yes, there are “parts” of the AR function, regardless of the size of the firm, that could be outsourced based on the size/type of organization, the goals that need to be accomplished and the availability of “outside” resources (or more importantly, funding) – all with the understanding that there must be an accountable person in-house to properly manage and drive the effort.


Here are three basic examples where outsourcing of AR activities might make sense:

  • The Introduction: Sometimes finding the right analyst, or getting in front of the right analyst, can be a challenge. This can be difficult in situations where a firm is moving into a new market sector (product and/or geographic) and may not be familiar with the most appropriate information analysts to reach (think of a US firm trying to move into ASIA/PAC as an example). Using an outside resource (an agency, advisor or perhaps even another industry analyst) to help find the right “connected” or “influencial” person can be extremely effective.
  • The Event: Outsourcing clearly makes sense whenever the word “event” is involved. In fact, the bigger or more important the event, the more outsourcing becomes a viable option (especially for a staff-constrained AR team). Much of the event coordination and publicity can (and should be) handled by hired guns (working under your direction, of course) and free up an AR pros time for more 1:1 analyst “relationship building” activities. This is also a great opportunity to involve PR and Marketing (see below).
  • The Startup: For firms that are just entering into the market, the ability to recruit – and pay for – a quality AR team may simply be beyond their means (CAPEX vs OPEX in a manner of speaking). In this situation, outsourcing the entire AR function to an outside “professional” team, under the control of a “C”-level or Senior “R”-level person my be the most cost-effective approach (especially if the level of work activity will fluctuate considerably over the first year or two).

Now let’s take a look at “insourcing” as a means to leverage in-house budgets and expertise to your advantage.


As I mentioned above, AR typically competes with IR, PR and Marketing for budget allocation. Interestingly, all of these functions tend to be a bit cyclical in nature and feed off of each other: it is not uncommon to find periods where one group is more “active” than another (that is not to say that any of these groups have “time off” or have any idle time on their hands). But depending upon the situation, the best outsourced resource for AR may actually be an insourced resource in the form of IR, PR and Marketing. This type of in-house insourcing, or collaboration, is something that most organizations could, and should, benefit from if properly executed (different roles, but working to help each other out by lending their own expertise).

This is not to say that every time AR needs a helping hand that they should look to an internal corporate ‘R” function for support, but rather that part of any company’s “R” strategy should include a dose of cross-function support. This not only helps with resource and budgetary issues, but can also be part of a much larger integrated marketing campaign (IMC) that can best get solid, reliable results when IR, AR, PR and Marketing are all working in sync with each other (notice I’ve left out sales – that is a separate function for a different discussion). Remember that while all of the “R” functions have very different responsibilities and areas of expertise, coordination of effort is critical to the success of any firm.


There are clearly times when outsourcing AR/Influence-related tasks can make sense – certainly the number of established PR, Marketing and Investor Relations agencies show that this model can work extremely well if executed properly. There are also times when, do to the nature or sensitivity of the work, outsourcing may not be a viable option. But if you are a small firm, or branching out into new market sectors, outsourcing certain AR “outreach” functions can definitely work (from both an access/influence and a financial perspective). And if you are a larger, more established firm, a combination of outsourcing and cross-function insourcing should definitely be part of your overall strategy.

One important item to keep in mind in both of these scenarios is “expertise”. Before you outsource anything related to corporate “influence”, make sure that you are selecting the right person (or team) for the job. Going with the lowest-cost option is almost always the wrong approach, while overpaying for “bloated reputation” can often be a waste of time, money and opportunity.

If you are in a position (or think that you might be at some point in the future) where in-house insourcing is a viable option, make sure that there is an established cross-training program and a solid team focus in place as part of the corporate culture before you start to rely on other groups for support. And remember, if you ask for support from one of your other in-house “R” functions, don’t be surprised if you are asked to return the favor – that’s what teamwork is all about.


First posted on Fred’s website.

6 thoughts on “[GUEST POST] Outsourcing Analyst Relations: A viable option? by Fred McClimans”

  1. Great post from the great Fred! I would advocate outsourcing AR is cases where internal AR pick their favorites above those analysts who have “real” influence over markets. Hate to admit this, but too many internal AR folks put their personal relationship agendas above the needs of their firms to leverage AR to generate awareness and new business.

    Having said that, we need to have proven third parties which can do a good job of being a viable “outsourced” AR option. Am yet to be convinced if there are any…

    Apologies if I just managed to p*ss off the entire AR community here 🙂 we simply need AR to be driving more visible value and get out of the old “checking the boxes” rut…


  2. Great question, and typically insightful response Phil.

    I wish the answer was simple. It strikes me that every vendor is a little different, and you could plot vendor AR on a two dimensional scale (a quadrant perhaps – wonder where that came from). X-axis left range startsn at “chasing quote requests for press releases” as the primary AR function, to on the right “sales enablement and strategic intelligence.” The Y-axis could be “AR treated as a freckle on the nose of PR” on the south side to “Big AR” (all the possible AR functions in your imagination) on the north. The graph would be rather evenly distributed I would bet.

    And then a 3rd dimension is vendor size, product/service diversity. The bigger and more diverse the offering set, the more impact AR has (or should have), the more difficult the practice is to manage over the long term.

    Given all of that I think there are a variety of opportunities for outsourcing. Events; Non-core product/service initiatives; Project management – WPs, research projects and such; Negotiations (some AR folks don’t like to muddy the relationship with the analyst firm by getting into contract negotiations directly); Perception audits and metrics – objectivity is nice here; Targeting and qualification aka which analysts should we work with – again objectivity is helpful here.

    In short, most AR practices have holes, and that is usually because of resource constraints associated with headcount limitations, organization structure, turnover, balancing the budget. AR work is not linear either, it has peaks and valleys. Outsourcing is a viable option certainly to plug holes and fill valleys, and occasionally to perform a sanity check. Plus it makes sense sometimes for budgets, allows for better control over fixed because the outsourcing is variable.

  3. In our experience too few PR firms have a sound knowledge of AR and view it as another form of media relations. Equally many AR professionals are one-person bands if specialists operating outside of in-house roles with the associated restrictions and focus this brings. It is also evident that the lack of AR skills in the UK and Europe is far worse than the US where the majority of PR agencies we know definitely ‘get’ AR as do most vendors. So in other words outsourcing AR in Europe is more problematical than in the US which adds further weights to the comments above.

  4. I’ve never been much of a fan of outsourcing AR, too many reasons not to. But with that said, I’ve found that it’s almost necessary when you’re organization pushes you into geographic regions you just cannot support with existing internal resources. Plus, in-region resources are often much more efficient than my core internal team could be in the near, and possibly, distant future.

  5. Great piece, nice summary, in my experience never outsource the value, but outsource the execution where time/resources are limited. As for the AR outsourcer just be aware of where the lines are to ensure you maximise value on all sides.

  6. I’m kind of with Evan on this. In my opinion I don’t think it’s possible, or credible to make a sweeping statement that in or outsourcing works. In my previous role I wasn’t a fan of using PR agencies to undertake AR projects (I’m still not) I did however use external resources for specific projects where the AR team had limited skills or a lack of resources.

    In my new role my firm is being used to supplement the in-house vendor AR team to fill gaps in resources / knowledge and to provide expertise for other clients through the agency route. Large vendors have tough tradeoffs to make between headcount and budgets. Sometimes they have money to spend with no headcount to execute, outsourcing is a great option there. In my opinion no one vendor is an island, they all operate in multiple eco systems or constellations, external AR agencies have the capability to bridge between vendors and create economies of scale or complimentary analyst relationships – this potentially offers a small or inexperienced in-house AR teams great results, amazing value and a fast return on investment.

    Bottom line for me is to assess the real business need and opportunity, then apply the right strategy. I’m reminded of the old phrase horses for courses, or perhaps never say never…

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