On Questions of Analyst Value

The Lotus community continues to ask some searching questions about IT industry analysts and the value we provide. One posting comes from Chris Linfoot. Meanwhile Lotus.Geek talks of “Opinion Whores”

I read Linfoot’s note and he makes some good points. As an industry analyst myself i am not surprised that many IT organizations are skeptical about the value of the work we do. There is a lot of poor work out there. The IT analyst sector is small and immature–but got delusions of grandeur during the late 90s. We need to do a better job of helping to map technology to business.

It is Interesting to see the point in Linfoot’s posting that a vendor has sent over a white paper that looks like technical documentation on NAS and SAN. At RedMonk we would parse the functionality within a business continuity, risk management or compliance oriented architecture perspective. That is how we do things. Enterprise technology is only interesting in so far as it solves a business problem, isn’t it?

Some of the criticisms may be a tad harsh, according to Linfoot “We used to see papers on business issues and how closely IT solutions came to addressing them”…

I am somewhat skeptical that the situation is getting worse with respect to technical versus business focus. i have seen hundreds of analyst reports in the last ten years (i used to be a technology reporter and got inundated with the darned things) and in my view they were often more technical, and less business savvy, than today’s equivalents. Those 250 page reports on Enterprise Content Management, say.

I would also argue the world has speeded up – business goes through faster cycles these days, just as technology does. It can be hard to take the long view, to map to a vertical industry problem over time, when these sectors change so fast. Music, iPod, consumer electonics, Dell selling TVs, Skype, Vonage, generic Pharma, building (the complexity of today’s huge projects creates new requirements in project and asset management), ASPs, salesforce.com, TV from my phone network provider, camera from my phone hardware provider, Wal Mart selling cars. Commoditization, convergence and mass communications make it a lot harder to build a five year world view and expect to find a range of technologies that map to it. We are tracking moving targets.

My point is–good analysts try to help our clients understand change–that is a critical part of what we do. If that pushes us towards fashion at times then so be it. Let’s face it – fashion is a major influence in business too–ERP, BPR, outsourcing and so on. Built to last or built to flip. Just because it is a fashion doesn’t make it any less important as a business driver, opportunity, or threat.

I for one am happy to see a healthy skepticism out there rather than just buying a subscription to an industry analyst firm because it seems like the right thing to do. My clients pay me because i provide valuable insights–its as simple as that.

One final consideration on Linwood’s post may be cultural difference. The British tend to be be a bit more skeptical about self-apointed experts that some other nationalities. This skepticism has made it harder for industry analyst firms to win enterprise customers that in the US. I notice that Chris is British….

At RedMonk we have been thinking about the IT industry analyst sector quite deeply of late, the business, the ethics, the business model, and so on. We are going to do some gentle tree shaking.