Advice on commissioning an analysis of your local economy

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So you want to commission consultants (like me) to undertake an analysis of your local economy, or the economy of your city or region? This might be something which you have never done before (if so, read on), or you are an old hand at (perhaps you can add your advice in the comments section?). It might be that your most recent report or analysis is a few years old and needs updating.
This article, written by Dr. Glenn Athey, Managing Director of Athey Consulting – sets out some of the key questions you need to answer in order to shape your plans and what you will ask the consultant to deliver. It also presents a few helpful hints and tips. Glenn has led on many such research projects as an originator and manager as well as an expert analyst – both for government agencies, and for clients in local government, as well as regional and national organisations.

ANSWER THESE INITIAL QUESTIONS

What’s the purpose of your economic research project, city economic audit or local economic assessment? What is its primary use? Is it for place marketing or inward investment promotion (if so then better make sure there’s a glossy summary report and some positive spin, as well as some infographics)? Or is it to inform your economic development strategy (if so, then will need in depth analysis but with some sharp and summative analytical points for strategic priorities and deliverables, as well as quantification of the problems and opportunities)?
Its cheaper and easier for consultants to build this into the main analytical/research exercise and subsequent report, rather than figure this out later.
What’s the scope in terms of themes and subjects? Its useful to think about the range of issues which may or may not be important to you. For example, if your city is looking to reappraise what kinds of industries it needs to plan for in terms of infrastructure, land, premises and skills – it helps to build in a very detailed analysis of industrial trends and employment. If your local rural district economy is dominated by small businesses, then it is necessary to understand who they are, their dynamics and patterns of ownership.
Who is the main audience? Is it politicians, government officials, or business leaders? Or is it all of these? I usually like to define the audience as a broad set of ‘decision makers’ who would generally read a broadsheet newspaper. I wouldn’t necessarily assume lots of technical knowledge, but broad familiarity. One audience I rarely cater for through these kinds of consultancy projects is an audience of researchers. In my experience, researchers based with client organisations either don’t have the time or resources to undertake the economic analysis and reporting in the timescales required, or the client does not have the research staff in the first place, hence the need to commission consultants. These types of research projects can be specialist – and ideally require experience, high level analytical skills, knowledge of tools and delivery for economic development, and the ability to write and structure a report. However, the audience tends to be non-specialist and so writing and communications skills and abilities come to the fore.
Do you require primary (i.e. original / survey collected data) or in-house (e.g. admin data) intelligence? If so then you need a consultant with experience of survey design and conduct, and/or of quality assessing, cleaning and analysing administrative data. Its worth noting that a good business survey (by telephone) costs between £25-35 per achieved sample response. Online surveys are a cheaper alternative – useful for a narrow range of issues; but not easily made statistically representative.
How long do you want your final report to be!? If you want 100 pages, then you are going to need to fill that up with some considerable analysis and commentary. Conversely – if you want a comprehensive analysis of all socio-economic themes plus survey results in 20 pages – you are probably being unrealistic. Whatever the length – you should specify an accessible 2 to 8 page long Executive Summary that is capable of being pulled out as a stand along report. At my consultancy (see mylocaleconomy) – we provide that to clients as standard.
END USE AND PURPOSE IS THE KEY, BUT ALWAYS ASK FOR ANALYSIS AND INSIGHTS
Thinking about the end use and purpose is the key to setting out your needs and expectations. It really helps consultants if you write that into the brief.

5 top tips for high quality delivery from your economic consultants

1. Be as specific as you can when writing your project plan and consultant’s brief. Mention the prime objectives, purpose and use of the final research report and outputs. If you want certain datasets included, then specify them – but be prepared for a good consultant to make additional suggestions. Try to be specific in terms of details, and length of report, particularly if you are prevented from mentioning the final budget.
2. Allow for a decent coverage of issues, datasets and time series. I’ve given up tendering for very tightly defined economic profiles where there are 10 or so specified economic measures or datasets to provide a ‘tracking report’ for (unless they are simple annual monitoring reports that augment a full economic audit that’s conducted every 2 or 3 years). These types of commissions typically do not have the budget to provide any of the underlying evidence to explain why the trends appear as they do. The typical scenario is that the client asks ‘why did that measure go down so significantly?’ and the consultant either says ‘dunno’ (which makes them look bad) or (like me) spends unpaid time digging around the data. When you sit down to analyse a local economy – finding the real ‘nuggets’ of insight often involves triangulating a lot of different measures and data sources.
3. Convene an advisory board. Particularly if the consultant is new to your area. This helps to identify local peculiarities or issues, and brings local researchers on board as well as the main beneficiaries of the report.
4. Research your business base. If you are using the analysis to inform strategies and delivery plans it is very useful to build in some research on your business base – particularly in terms of key businesses and supply chains. It also helps to understand the economy in a more grounded way than just statistics alone can.
5. Always ask for analysis and insight. This isn’t just a matter of data collation and description. You need to know what is influencing the key trends and findings, to answer the ‘so what’ question. Ask for explanation. Ask for SWOT and PEST analysis. Be demanding.

SOME OPTIONAL EXTRAS?

Quite a few clients ask for add-ons, where there might be additional costs, some considerable. Typical examples include:

  • Economic forecasts. I would recommend that these get supplied by a recognised forecasting house or consultancy, who also have specialist local and regional economic models. Typical costs range from £2,000 for one district, to £10,000 for something mode detailed and with comparative areas. Many areas in England club together to commission regional economic forecasts.
  • Business surveys. As mentioned – typical costs are £25-£35 per interviewee. In a typical locality with a few thousand businesses, a representative sample is going to cost somewhere in the region of £10,000+
  • Typesetting and publishing. Its used to be unusual that a consultant could provide you with a top quality report that can be printed. In the past your normally needed a design consultancy to do this for you, particularly to make this brand compliant with any design guidelines you may have. However, it is now possible for consultancies to provide fairly good quality reports in terms of design, colours and graphics. However, for a report to be printed and bound etc – a design consultancy would normally be needed, and paid for.

At Athey Consulting we offer top quality economic research and analysis, with high impact writing and presentation.

  • high quality analysis, done by qualified experienced economists and statisticians
  • reports, analysis and insights that benefit from professional experience as practitioners and strategists as well as economists
  • closely understand the policy, delivery and funding environment – makes for highly practical outputs
  • accessible, clear, high impact writing, with professionally copy-edited reports (by a specialist trade journalist and editor)
  • high quality maps and infographics
  • we make the report and outputs as compliant to your existing design guidelines as possible
  • absolutely tailored to your needs and budget

More on our experience at https://www.mylocaleconomy.org/local-economic-assessments/

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