"Have you ever wondered who is whispering in the ears of your customers? Who has their confidence? Who is influencing their decisions?"
Those are the questions posed by Bill Hopkins, founder and CEO of the Knowledge Capital Group, at the start of his new book, Influencing the Influencers: Best Practices for Building Valuable Relationships with Technology Industry Analysts. As the book goes on to discuss, industry analysts -- firms such as Gartner, Inc., Forrester Research and International Data Corp. (IDC) -- are critical influencers in the trillion dollar world of information technology.
They are far more powerful than the press. They are second only to executive peers in terms of the value that technology buyers place on their advice.
What makes them influential -- some of them, at least -- is their power to advise clients on their technology options. They short-list technology vendors and feature them in their research. The words of a respected analyst can make or break a technology vendor. In fact, technology buyers -- in the Fortune 500 and beyond -- now rely on analysts as an insurance policy (or "Kevlar underwear" as the book colorfully puts it). Big ticket IT decisions are simply more defensible when a recognized third-party such as Gartner blesses them.
That powerful influence arguably is growing. “The IT decisions that CIOs and their direct reports are making today are more complicated and more important to the business than ever before,” says Dale Kutnick, founder of Meta Group, which was recently acquired by Gartner. “There are more variables to consider. The financial ramifications of right or wrong decisions are more compelling than they were 10, 15 or 20 years ago... We are an insurance policy. We are a risk management or mitigation policy for the user environment because they are making multi-million dollar IT decisions."
With this in mind, Hopkins helps the reader understand the intricacies of the influence game and weigh the relative impact and importance of various analyst firms. All analysts, it should be said, are not created equal.
Gartner and Forrester, for instance, are generally more influential than others because they derive most of their revenue from technology buyers (the "end-users"). They are considered "Deal Makers or Breakers" in the book. However, other firms such as IDC, AMR, Tower, Ovum are recognized as "Point Players" that are influential in specific markets.
Still other firms, which derive a majority of their revenue from the vendors, are mostly valuable as a means of generating media exposure. They generally have no influence on technology buyers -- though the press typically quotes them without revealing their financial conflicts.
The book, which I helped produce, enables readers to navigate the strange and often murky world of analyst influence. It provides a roadmap and clear set of best practices for executives and other professionals who want to understand the hidden power that analysts wield. It explodes plenty of myths, untruths and half-truths.
Analyst relations, as Hopkins demonstrates, can be actively measured and managed. It is quite possible -- as case studies in the book demonstrate -- to measure the impact of AR investments. As AR leaders from companies such as Oracle, IBM, Xerox, EDS and Symantec demonstrate, you can build a disciplined plan, execute it and build valuable relationships with analysts.
Companies that wish to become (or remain) thought leaders in their market segments need to have a handle on these underappreciated factors in the technology decision cycle.
Gartner's Magic Quadrant, which is a fairly good indicator of whether one is getting short-listed by the world's most powerful analyst firm, is one place thought leaders can measure their progress. The research model -- a two-by-two matrix dotted with vendor names -- reflects not only one's "ability to execute" but one's "completeness of vision" as well. This "completeness" is largely related to your ability to articulate your market perspective and path to customer value. If your vision is not complete, in other words, it becomes that much harder to compete.