How analysts can increase their influence

It turns out that I’m becoming known for my “analyst bashing” blog posts and other writings. It's not a reputation I've sought. But I've made no secret that I think analyst influence is generally overstated, and that’s with eleven years of inside knowledge at Ovum and IDC. I’ve seen analysts with huge influence and those with very little. The real issue is, how do you tell them apart?

As Richard Holway told me:

Any fool can be an analyst
But very few get to be influencers.

Bill Hopkins’s AR text Influencing the Influencers maps out very clearly why a few analyst firms carry the majority of influence within the analyst community – I commend you to read it. As Bill states in the book, “Some influencers are more vital to you than others.” Though it’s completely obvious if you think about it, many vendors (and AR agencies) don’t think about it, and propagate blanket importance of analysts. PR agencies do the same with journalists.

I think a primary challenge for all analyst firms is to make their analysts more influential. The first question to be asked, as always, is who do they influence? A better way of understanding the relevance of this question is to ask another: who do vendors want to be influenced by analysts? Usually, vendors are trying to influence decision makers, so that they buy products and services. It’s logical, therefore, to want to know which analysts have influence over those decision makers, that can sway a decision in one direction on another. These are what Hopkins calls Deal Makers and Breakers.

Clearly, then, the more analysts are influencing decision makers the more influential they are to vendors. And while it’s risky to categorise all analysts within one firm together, a firm’s business model will point to the likelihood of influence on decision makers. So Gartner, with its end-user research focus and consulting business, is likely to be more influential than, say, IDC, which has a predominantly supply-side viewpoint.

Additionally, the closer an analyst gets to the decision maker, the more influence they will have on that decision. In my experience, this deep level of influence is delivered only through client engagements and consulting. So analysts that directly advise decision makers carry the greatest influence.

There is also an issue of when influence is being applied. Analyst research papers are used by end-users as guidance and pointers, sometimes in the development of shortlists. This occurs early in the decision making process. Consulting, again in my experience, happens later in the process where evaluations and recommendations are being made. At this point the stakes are high, and individual analysts much be sure in their understanding of both the needs of their client and the capabilities of the vendors they are judging.

I think that this is where many analysts, and analyst firms, cop out. They are unwilling, or unable, to help a specific end-user client make a final decision. They may claim that doing so would conflict with their vendor independence. Nonsense. Recommending a specific product to a specific end-user organisation does not conflict with independence, as long the same analyst is just as likely to recommend a different product to another client with different needs.

So I think analyst firms should tell their analysts to get out more. Talk to, engage with, and start influencing end-user decision makers. It’s the only route to real influence.

“Influencing the Influencers” reviewed

Just finished reading “Influencing the Influencers” by Bill Hopkins, CEO at Knowledge Capital Group (KCG). KCG is an Analysts Relations firm, and the book is a guide to AR in the technology industry.

I think that if you’re in AR you’ll get a lot of value from the book. It categorises the various types of analyst, provides best and worst practice examples, and even offers careers advice. All in all an excellent volume on Analyst Relations.

It’s a pity about the title, then. At face value, it’s a cosmetic thing – “Influencing the Analysts” is much less pithy. But it’s the assertion that analysts are the most important influencers that concerns, because our clients and our research tell us (at Influencer50) that it ain’t always so.

Perhaps it’s just that our perspectives are different. Bill examines the reach of various influencer types into IT deals. Bill estimates that peer groups influence decision-making in 80% of IT deals, analysts influence decision-making in 60-80% of IT deals, and so on. Systems integrators and consultants influence 20% of IT deals.

Note that these deals relate to Global5000 firms. Does anyone know of an IT sale to a G5000 firm that wasn’t influenced by a systems integrator or consultant? Hmmm.

Influencer50’s approach is to examine the available influence on a decision, and how this influence is distributed across many influencers. So we measure the extent of influence on IT decision making, not simply its presence. Analysts may appear in 60-80% of decisions, but what’s the extent of their influence? We believe it’s overstated.

KCG’s model even allows for this: in its categorisation of analyst firms it names only Gartner and Forrester in the “Deal Maker & Breaker” segment. In other words, most other analyst firms have limited influence on decision-making. (Exceptions are granted, such as specialist point players and regional buy-side players such as Ovum.)

I suspect there is more agreement than disagreement between KCG and Influencer50. To quote from the book, “Some influencers, of course, are more vital to you than others. But, overall, the effective management of influencers has become increasingly critical to the success of any enterprise.”

That’s pretty much what Influencer50 is about.