Monday, 19 November 2007

Rebels vs. Dinosaurs: What Carter's Law Means for AR

After a lot of discussion (what influence is, Web 2.0 and open source mean for the analysts business model) it is time to come back to Carter's Law: Finite AR resources need to be carefully managed if AR is to be effective.

AR professionals often face a dilemma. How can we balance focussing on the most influential analysts, on the one hand, while using the other hand to serve a widening community? New influencers are less visible but still can be crucial, either in today’s complex IT ecosystem or in the hearts of our executives.

In layman’s terms, this is quite a simple equation. A Tragic Quadrant vendor review can consume as much as 3 FTE over 2 weeks. However, the risks of not providing a structured response on that same Gartner Magic Quadrant can waste months of efforts and much goodwill in the marketplace. We can despise Gartner’s pricing, but a bad MQ can still be career-limiting for an AR professional. It can also lead to lost sales and depressed share values.

That means that the two options for reaching out to a wider community are:

  1. to increase the resources available for AR, especially headcount and budgets and/or

  2. to adopt tactics similar to consumer marketing or PR: newsletters, multi-firms briefings, etc…
The second options assumes that what is lost in targeting (analysts hate mass emails) is made up by the increased audience. Marketeers have long known there’s a direct relation between accurate targeting and response rates: not a trade-off. Better targeted materials aimed at a smaller audience produce better overall results than junk. But just try telling that to those colleagues who over-value the long tail. Dale has picked up the gauntlet and responded to our previous post. Check his post and the comments at What does analyst relations have in common with the Telco industry?

ARmadgeddon’s take for AR Managers:
Analysts influence unfolds in different markets through many different channels and it is important to segment this audience more finely than just in 3 tiers. AR managers should, more than ever, align their goals with their stakeholders' business plans and use carefully chosen goals to impact carefully selected analysts. For instance, in the software world some analysts influence the developer community and it might be right for a start-up to target those analysts rather than those who influence CIOs, others might influence a key region or industry and should be focussed on if, and only if, that specific region or industry is a business priority.

It nevertheless remains true that filtering insight from noise is increasingly difficult: AR managers should explore Rebels -- but do not ignore the Dinosaurs. We should be, however, careful on how they engage with a fast-flowing and dynamic community: bloglysts tend to be very reactive and it is not enough to deal with them in a one-way mode as PR is often accustomed to.

AR managers should also be wary of preserving reputations and not waste analysts’ brands and community goodwill by being over-aggressive: in the best case the output of pressured analysts will be bland and irrelevant, in the worst they will be stifled publicly. Do read Dale on the patronage model for more.

Armadgeddon’s take for Analysts:
Bloglysts need to figure out what new business models are coming out of the Web 2.0 age and how to provide value to the IT buyers community or face being commoditised.
Independent analysts need to find a way to put aside their egos and work as a community to effectively compete for their fair share of the IT analysis industry. They also need to provide more proof-points for their influence than just simply citing names of clients they work with.
Traditional IT Analysts need to embrace communities and Web 2.0 tools and move up the value chain by offering contract negotiation and other high-value services.


Dale Vile said...

Seems like a reasonable summary.

You are kinda suggesting an objective matrix driven approach to assessing the importance of analysts to you. Makes sense. See here for a few thoughts on this.

ARonaut said...

Agree with your thoughts Dale, it's a question of horses for courses. Not that I'd call analysts horses but you know what I mean.

The key issues are filtering noise (again here the concept of a research wiki is pertinent) and time wasters (see my comment on Vinne's post).

As a conclusion, your matrix is very useful to align AR plans to internal stakeholders and organisation goals.

James said...

Stephen did rather more than just post some customer names with his response. again though- what if we said we didn't accept customer references as evidence points from vendors briefings. that would be absurd wouldn't it?