BCG buys business simulation modelling firm in Australia

21 February 2019 3 min. read

Boston Consulting Group has acquired Australian software company The Simulation Group, which provides virtual simulations for businesses.

Formerly a minority stake-holder, Boston Consulting Group has acquired Australia-based business modelling provider The Simulation Group (TSG) for an undisclosed sum. BCG previously picked up a minority stake in the advanced analytics firm in 2015, which had continued to operate independently in a joint partnership, but has now been folded into BCG’s analytics and data science arm BCG GAMMA.

Founded in Perth in 1999, TSG has over its twenty years since inception grown into a world-leader in advanced analytics simulation and optimisation, providing dynamic simulation modeling services to clients initially in the mining and now across sectors such as healthcare and transportation. According to the firm, it has completed more than 500 projects around the world, including far afield in South America, Africa, Russia and Canada.

“What we are trying to do is help the clients make informed decisions,” Craig Stewart, TSG managing director and one of six co-founders told the Australian Financial Review. “The simplest way to describe a ‘digital twin’ is it is a virtual version of a system. We replicate the business rules, the processes of a business, and then test out hypotheses on this digital twin. We can identify where opportunities exist, remove bottlenecks and predict the performance of the system in the future.”BCG buys business simulation modelling firm TSG in Australia“TSG has helped its clients save billions of dollars by improving capital investment decisions, removing bottlenecks, and improving throughput,” said Sydney-based managing director and BCG GAMMA Asia Pacific head Simon Miller at the time of the earlier investment. “We've successfully worked with TSG on many engagements and are delighted to make this investment today and to extend this offering to our clients.”

According to reports, TSG has a total of 42 specialists across offices in Perth, Melbourne, Brisbane and Santiago, Chile, with six of TSG’s senior staff now having taken up principal data scientist positions at BCG Gamma – the equivalent of partner level. The firm’s remaining staff-members have joined BCG in a variety of data science and engineering roles – reportedly tripling the local GAMMA headcount.

“We are very excited about the opportunities this merger will bring to our clients and staff,” TSG stated in a note on its website. “BCG Gamma’s strengths lie in depth in advanced analytics, AI and machine learning. Combined with TSG’s expertise in simulation (‘digital twins’) and optimisation, together we will offer a broader technical toolset to complement BCG’s broader world-renowned capabilities in strategy and change management.”

Now located in a dozen countries – including a launch in Poland last year and an announcement on a move into Canada – and led globally by Paris-based partner Sylvain Duranton, BCG GAMMA sits alongside innovation and venturing arm BCG Digital Ventures and IT architecture and solutions practice BCG Platinion as the firm’s specialist data science, AI and analytics wing. In addition to Sydney, the arm has a further Asia hub in Singapore.