Tuesday, August 10, 2010
Star Analysts according to James McGovern: Part Two
Below are six traits of star analysts...
Quantitative vs Qualitative
Some analyst firms are overly obsessed with metrics. While I too believe in the use of metrics to enable informed decisions, the vast majority of metrics captured by analyst firms have nebulous value to end customers. Consider the scenario where I am looking to purchase a relational database. Does knowing that Microsoft and Oracle are the top contenders from a metrics perspective add value to the conversation? Would it add more value if I were to see those metrics sliced and diced between industry verticals? For example, we know that Sybase is very popular on Wall Street but otherwise gets lost in the mix if you look outside of financial services. Let's face it, some products are generally applicable to all industry verticals while others tend to have an affinity to particular verticals. In order for metrics to be useful, analysts would need to provide more of a dynamic way of allowing customers to get customized metrics. Otherwise, they are of questionable value.
Qualitative analysts on the other hand tend to do a lot better job of explaining a problem through the lens of a customer and not primarily reliant on the metrics they have captured in surveys. We all know that the grass is always greener in the neighbors yard and this scenario applies to enterprises as well. Should I care what 74.2% of the insurance companies at large are up to or do I really care more about what Travelers, Progressive and Geico are up to?
All of the analysts that made my list are masters of being qualitative and are able to provide deep insight not only on their particular coverage area but able to understand the industry vertical slice as well.
Abstraction can morph into distortion
The quantitative people will respond with the notion that sometimes a customer simply needs a number. I believe that sometimes a customer simply needs a name. Did you know that our media relations policy doesn't allow for me to be abstract in my communications with the outside world? I cannot hide behind the fact that I work for a Fortune 200 enterprise headquartered in the Northeast. I must use my company's name. Which of the below phrases do you feel is more informative:
- I had a conversation with several insurance carriers in the Midwest regarding X
- I had a conversation with several insurance carriers including Geico, Selective, State Farm and Progressive. One of them indicated that they are using X
All of the analysts that made my list are masters of contextual name dropping without violating non-disclosure.
The Responsibility to be Social
All of the analysts that made my list are participants in a variety of social media forums ranging from Twitter to Facebook. This means that they are doing their part to keep an up to the minute pulse on the industry and what people are talking about. Waiting around for surveys and conferences in order to figure this out is minimally lazy and more than likely not timely.
If you observe an emerging trend before others, you are a true analyst. If you observe a trend after everyone else has already analyzed it, you are a historian. All of people on my list do not practice archaeology but are true observers, participants and most important amplifiers to those willing to take risks and lead.
When in an enterprise setting, sometimes we are looking for a strategy around commercial vendors. At other times, we simply need to know the cheapest thing that can possibly work. Many analysts sit back and wait for vendors to schedule briefings with them. This behavior causes many analysts to not have visibility into viable open source product offerings. The best of the analysts do their own homework and don't wait for information to come to them.
All of the analysts on my list are literate when it comes to open source and follow all forms of software regardless of its cost or lack of.
The Buck doesn't stop at Procurement
The vast majority of analysts seems to spend less time understanding products and more time analyzing vendors. At some level, they are doing their end customers a big disservice. We all know that if an enterprise spends a million dollars on a product at procurement time, that we will spend order of magnitudes more throughout its lifecycle and therefore some focus on not just what it take to procure it but what should we do after the product has been purchased is in order.
Maybe the shortcoming of analysts who didn't make the list are the ones who were never practitioners and therefore wouldn't have a clue as to how to understand what occurs in an enterprise after it has been procured? With a few exceptions, the vast majority of analysts that made my list held senior-level IT positions in large enterprises at one point in their career. They weren't English majors who studied journalism and decided that being an analyst was more lucrative.
Briefings are Good, Conversations are Better
Sometimes there are burning questions that pop up out of nowhere within an enterprise. Do I really want to wait a week or two until the analyst is free in order to have a dialog? Sometimes you have a question that doesn't require a conversation and you simply need to be pointed in a better direction. This can be accomplished via thirty year old technology known as email. Sometimes when I ask a question, I fully expect a few links to come back and nothing more.
All of the analyst that made my list not only will communicate with end customers the way that end customers want to communicate, but they will usually maintain a relationship after a dialog has ended. The vast majority of analysts look at scheduled briefings as being transactional and miss the importance of building a relationship. I really like it when an analyst sends me a link that contains something of interest to me especially when I wasn't expecting it. This shows that the analyst isn't just interested in achieving some arbitrary internal metrics set by his firm but is interested in a long term relationship.
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