BCG Australia integrates tech simulation firm TSG into Gamma
US management consulting giant Boston Consulting Group (BCG) has fully acquired The Simulation Group, an Australian technology and software company. The Simulation Group’s 42 employees will be integrated into BCG Gamma, the firm’s analytics and data science division.
Boston Consulting Group’s Gamma team in Australia consisted of around 20 data consultants and scientists, and with the addition of The Simulation Group the team has tripled to around 60. Combined, the two players want to help client make “better informed decisions” leveraging technology that allows companies to replicate their operations.
Founded in 1999, The Simulation Group has developed proprietary software that creates a virtual version of a client's business in order to run simulations of different scenarios. By replicating the way a business is run under different conditions, leaders can make better strategic decision and enhance the way they adapt operating models to scenario’s that have previously been prepared. Using emerging technologies such as artificial intelligence and machine learning, companies can also use the model to simulate better version of their business, in essence helping them professionalise processes and governance.
"We can identify where opportunities exist, remove bottlenecks and predict the performance of the system in the future,” explained Craig Stewart, managing director and co-founder of The Simulation Group.
The deal sees BCG adds a team of 42 employees generating around $10 million in revenues to its Australian footprint. Six of The Simulation Group’s senior staff have been appointed a principal data scientist at BCG Gamma, with remaining staff moving across in positions including data scientists, data engineers and data architects. BCG has four offices in Australia, in Sydney, Melbourne, Canberra and Perth.
The deal between the two does not come as a major surprise. In 2015, one year after the consultancy acquired Sydney-based digital design firm Strategic & Creative (S&C), BCG acquired a minority stake in the advanced analytics firm. Since, they have worked on more than 15 projects over the past five years, in sectors including aviation, mining and retail. Late last year, BCG formally put forward its offer to buy the remainder of the company.
Commenting on the joining of forces, a spokesperson of Boston Consulting Group said: “BCG Gamma’s strengths lie in depth in advanced analytics, AI and machine learning. Combined with TSG’s expertise in simulation and optimisation, together we will offer a broader technical toolset to complement BCG’s broader world-renowned capabilities in strategy and change management.”
Globally, BCG is growing its BCG Gamma subsidiary at a time when digital disruption is at the top of executives’ agenda. The arm launched in Poland (Europe) and Canada last year (North America), lifting its presence to a dozen countries. The arm sites alongside other tech-driven wings of BCG: BCG Platinion, the firm’s specialist technology implementation and IT architecture unit, BCG Digital Ventures, its digital and creative agency, and BCG MAYA, a digital marketing player.
According to BCG Gamma’s global head Sylvain Duranton, “BCG Gamma builds powerful data and AI-driven solutions for clients within nine to twelve months….. the gains from data analytics can be substantial, easily representing 1% to 3% of company turnover.”
Last month BCG Australia promoted Wendy Mackay to Partner, she is based in the Sydney office.
