InformationWeek.com

Welcome Guest. | Log In| Register | Membership Benefits

November 15, 1999

Analyzing The Analysts:
The Knowledge Merchants
continued...page 6 of 7

Related links:

Consulting Firms Tap Stock

And from our sister publications:

Computer Reseller News 5 Biggest Investors...Then And Now

Electronic Buyers' News Tyco Fighting Analyst Attack
The big research firms argue that the depth of their analysis is one of their strengths. But they concede that one of the biggest challenges they face--one all too familiar to IT chiefs--is hiring and retaining experienced and talented people. "Finding great people, whether it's researchers, consultants, or sales representatives, is always tough," says Meta Group's Kutnick.

Some firms have a full-court press on in many areas of IT at once. "The hottest areas in research are supply-chain management, customer-relationship management, and newer E-commerce applications," says AMR Research's Friscia, who adds that AMR has significantly increased its staff during over the last three years to support these and other areas. In December, 1997, the firm had 50 people; by the end of this year it will have 160. "The majority of those are research analysts," Friscia says.

All of the firms are trying to boost their expertise in the area of research and analysis most on the minds of technology managers today: E-business. "It's where the largest demand is coming from," says Giga Group's Weiler, whose firm is trying to recruit former and current CIOs, among others, for its E-business practice. "We want people who know how to build a business around electronic supply-chain management, and how to connect legacy systems and ERP with front-end customer systems," Weiler says. In August, Giga Group hired Larry Paul, former CIO at Carrier Corp., who guided the company's E-business initiatives as director of its E-practices division.

chart IDC is adding about 60 analysts a year, most of whom have experience with Web technology and E-business planning, says president and CEO Kirk Campbell. Gartner Group, which launched an E-business research service in late July, is trying to recruit E-savvy analysts as well as retraining many of its current 800 analysts in E-business issues. "In the last 12 months, we've focused our analysts on understanding the needs of our clients in E-business," says Fleisher.

Forrester is looking for researchers who know about E-commerce issues and are also experts in specific industries, such as utilities, says Stuart Woodring, VP of research. "There's an unbelievable shortage of good people," he says. "Anybody who says they can hire all the people they need is lying."

Analyst firms are also developing products and strategies to cash in on the growth of E-commerce. Last week, Gartner made a 70% investment in cPulse, an Internet company that monitors and benchmarks customers' satisfaction with a company's Web sites. Gartner says it will make customer satisfaction data available to clients, in aggregated and anonymous form, to establish a "Web customer satisfaction" benchmark. Also last week, Giga unveiled the Web Site ScoreCard, a service that evaluates a company's Web site. The service provides a detailed Web-site analysis and compares the findings with competitive and related "best-of-breed" sites.

There are about 140 firms providing some type of IT research, and new ones, particularly on the Web, are emerging regularly. "They're popping up everywhere," says Stratigos of Outsell. "We're going to see a lot of new Internet-based research companies emerging."

More competition should mean lower prices, but it also reduces these services to commodity status. "The growing competition is diminishing the perceived value of the information," Stratigos says. Although IT managers still find research products and services important, the survey shows that they're buying about 10% fewer of these than they were two years ago.

When FVC.com deployed a Web-based sales and marketing automation application, it used information not from analyst firms but from product reviews in trade journals, says Cowan. "We examined a lot of reviews that gave us a short list of features and characteristics that were absolutely essential. It allowed us to weed out 80% of the vendors who probably weren't big enough as companies or mature enough in terms of product age or were just missing critical features."

Although Brekke of NextLink uses the Web and industry publications to gather information, he doesn't think the Internet will make research reports from Gartner Group or the other firms obsolete. "It's hard to ascertain how reputable information is on the Web, unless you can be sure the company providing the information is reputable," he says.

"There will always be a place for paid analysts," adds Rogers of Mony Group. "We're using the Internet to supplement the intelligence we get from Forrester and Meta, and it's hard to picture how we'd be able to get advice from the Web that's so targeted and specific."

continued...page 7
return to page 1, 2, 3, 4, 5