Yesterday, WSJ’s Lee Gomes revisited his 2002 criticisms of Aberdeen Group. (2008: Vendors Still Paying…; 2002: Glowing Report on Firm X Isn’t… . I respect Lee Gomes. I suggest that analyst watchers and research buyers read the piece, not only for what’s there but for what’s not.
In short: Mr. Gomes checks up on Aberdeen, now part of Harte-Hanks and risen from its own ashes (from a fire many credit Gomes with lighting). He acknowledges some key changes at Aberdeen — such as transparency on vendor sponsored research — but essentially sends readers away with the bitter scent of pay-for-play hanging in the air.
I’ve been impressed with the Aberdeen business model. I see it as one that successfully links high-volume, low-cost benchmark surveys with vendor demand-generation programs. It’s closer to traditional market research and more scalable, on paper, than many of its IT analyst competitors engaging in the same kinds of activities. Of course, final judgement on whether any of this is good or bad comes down to daily execution.
Gomes finds much to criticize about that.
Yet, he avoids a couple of elephants standing in the middle of the room.
One of these elephants is whether ICT industry analyst research warrants the kind of mandated clean-up we saw with U.S. investment industry research.
Gomes finds that 5 years of Aberdeen self-imposed improvement still come up short of the mark on business ethics. What now? Is it time we progress into a full-fledged debate on government intervention?
After all, WSJ readers are not likely to be thinking this as an isolated situation at one IT industry research company. More likely, they’re seeing it as a tacit statement on ethics across the IT industry analyst sector. And, the WSJ readership embodies a hefty chunk of the IT analyst customer base.
Another elephant in the room is whether the old distinctions between market researchers and IT industry analysts still hold true.
What is the difference? Do we understand it? Is it relevant?
Or should we put the “industry analyst” distinction on moth balls, just another Maginot Line left over from the 20th century?
More blogger reactions to Lee Gomes coverage on Aderdeen
Investile Dysfunction: IT Research Firms Get the Smackdown from the Wall Street Journal
The Whole Nine Yards: Lee Gomes vs Aberdeen: Round 1
Technobabble 2.0: Aberdeen Group - guns for hire, which includes a response from Stephen Gold, President of Aberdeen Group, a Harte-Hanks company
AttentionMax: TThe Future Of Industry Analysts In The Tech Sector
ITtoolbox: Is it really research or is it paid advertising?
Spend Matters: The WSJ Shows No Love for Aberdeen
Paula Rosenblum’s Blog: WSJ - It’s so easy to Misunderstand
UPDATE Feb 8:
Analytics Evolution: Aberdeen Group Under Fire from WSJ Reporter
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March 7th, 2008 at 9:13 am
[…] Posted on Friday 7th March 2008 by sunesisar There’s been a bit of a discussion going around lately on ethics in the industry analyst […]
March 7th, 2008 at 9:43 am
Hi Barbara
An interesting post. The question you ask about the distinction between analysts and market researchers could be extended to include marketing consultants as well. Would you go out of your way to give a marketing consultant the same access as an industry analyst? Probably not. (But if the marketing consultant was a high profile media commentator, then perhaps you should…)
So long as “industry analysts” can continue to demonstrate value to vendors (be it at a commercial, industry insight or ‘buzz’ level), they will continue to be a valued audience. But the dominant position they held in the industry until now is under more threat today than ever before.
Some of that threat comes from the growth of the procurement consultants (especially in the services business) and the rise of some of the knowledgable and experienced bloggers. Both are capable of adding some of the value that an analyst traditionally has claimed as their own.
But some of the threat comes from people using the phrase “analyst” incorrectly because they believe it gives them a better position in the market. For instance, I’ve noticed there’s a tendancy now for some media outlets to use the title “analyst” to describe people who previously were called journalists.
FYI, I’ve finally got around to writing my own piece on analyst ethics. It’s over at the IIAR blog - http://iiar.wordpress.com/2008/03/07/ethics-and-independence-among-industry-analysts/ Love to know what you think!
Cheers
David
March 7th, 2008 at 5:24 pm
I have read your post, and am keen to follow up next week. I agree with you that AR people need to take a stand on analyst ethics, or shut up about it.
Bashing industry analyst credibility has become nothing more than a popular link bait strategy. Analysts, consultants, AR people and other bloggers are using it more and more often. In most cases, their only objective is self-promotion.
Obviously, Lee Gomes’ article struck a chord with me that day. If a journalist of his caliber believes the situation is bad enough to devote column inches, then he should deliver his readers to some meaningful conclusion or recommendation. In his article, any sense of “therefore” was MIA.
Some analyst firms and some analyst employees need a good ethical shakedown. But get real — so do some of the trolls.
March 10th, 2008 at 8:31 am
[…] This caused quite a stir amongst several AR commentators which eventually moved the discussion towards that on […]