Can a New Analyst Firm Take Down Gartner?
May 12, 2012
For more than 30 years, Gartner has dominated the IT analyst market. CIO.com columnist Rob Enderle sees Ombud, a new analyst firm focusing on social CRM and pulling member profiles from LinkedIn, as a viable challenge to a firm founded before there were even PCs. Rob Enderle (CIO (US)) 12 May, 2012 02:42
Gartner is a major power in the IT advisory firm space. There is constant contention between Gartner and the vendors who think, right or wrong, that the company charges them way too much—sometimes upwards of $100 million—for positive reviews. IT buyers often complain that Gartner, like any large company serving lots of people, doesn't get down to their unique needs and often sends them analysts who are inexperienced. Furthermore, there has always been a concern with every vendor-funded firm in the segment that the difference between reviews and marketing collateral is negligible. With Gartner, the issue generally isn't corruption but, rather, timeliness and relevance. But while there have been several attempts to take out Gartner since it was founded as the Gartner Group in 1979-first by IDC , then by the Gideon Gartner-founded Giga Information Group (which, in the interest of full disclosure, I helped found as well), and finally by Forrester Research -Gartner remains the power in the market. However, the market has changed dramatically since the founding of these firms. Increasingly, the IT department, the audience we all target, is no longer the owner of the technology budget. Rather, this budget is controlled by line management , which doesn't listen to Gartner and, for that matter, often doesn't listen to IT either. One of the biggest IT complaints at the moment is the massive number of transactions employees are putting on credit cards to buy some online service. This is on top of the massive wave of BYOD (Bring Your Own Device) requests that IT must deal with. Employees, often with the support of their managers, are purchasing a tablet (most likely an iPad ), cool laptop or other device and asking IT to put it on the network. Drawing on End Users, Experts for Purchasing Advice
This all came up over drinks the other night when I was presented with the latest-and there is little doubt there will be more-on the list of products and services aimed at killing Gartner. This latest service is called Ombud , and it's presented as a social CRM (customer relationship management) service. This fascinated me, since the model for most of today's analyst firms came from Gideon Gartner's perceptions of the industry. Remember, Gartner Group was conceived well before social networking, at a time when there not only was no Internet but no PCs. It seemed that it wouldn't be long before someone would figure out how to blend experts, practitioners and vendors into a service that would be cheaper, more current and more focused on the unique needs of an individual company, thus providing more real value (regardless of price) than the older model. Ombud is short for "ombudsman," and the idea is consistent with Gartner's initial concept of the Gartner Group analyst. By definition, an ombudsman "acts as a trusted intermediary between either the state (or elements of it) or an organization, and some internal or external constituency, while representing not only but mostly the broad scope of constituent interests. "
Like a social network, Ombud has created product segments where users and reviewers can comment on products and follow the result. The service pulls from LinkedIn when users set up initial profiles and uses real names. As with the typical topic-focused social network, Ombud collects and vets this group of names. If you are looking for a particular product, then you can find those who have already used it and, through the Ombud network, ask them questions. (The product is in beta, and, like any social network, some users are more active than others, so you may not get an instant response. ) The key is that you aren't talking to analyst but, rather, folks who have actually deployed the product you are considering-and you may become an expert for those who join the Ombud network after you. Ombud makes money by selling access to RFPs, which users create and vendors bid on. There is no membership fee. (I am a member. ) In this sense, it uses a fraction of the money that Gartner collects from vendors to provide an expert practitioner network that can help you define your RFP. Even though Ombud is free, if you just parachute in for RFPs, then you're unlikely to get the depth of experience that you'll get if you actively participate. Staff of Experts, Not Analysts, Leading the Way
The Ombud executive team is fascinating-the CEO comes from IBM (via acquisition, just as I joined IBM), the chairman comes from Hewlett-Packard (as the CEO of a company HP acquired) and a co-founder comes from Northrop Grumman. Meanwhile, senior employees have experience in fields ranging from security to social media. Overall, this pedigree includes experience with a major vendor or IT purchaser, as well as related education and executive leadership. Not a single one, it should be pointed out, has ever been an IT analyst. This may be an oversight, or it may just represent fresh thinking. It may have also led to an error, or perhaps a misperception, on its website . "Currently, the firm states, "corporate technology evaluations are heavily influenced by technology research firms, which base their decisions on information provided by the vendors, with limited or no input by end-customers. "
This isn't necessarily true, as Gartner talks to lots of customers. The issue is that this communication seldom happens in a timely manner and does not involve line management, which is often driving a firm's buying decision. In short, Gartner is often talking to the wrong person in the customer account. A service leveraging LinkedIn could get to the critical decision makers that Gartner is missing and get them more timely feedback. Social CRM Model Ready for Challenges of Fast-Paced IT Industry
Every few years the IT industry changes dramatically. It amazes me that services such as Gartner have changed very little during this time. That typically opens the door for competitive challenge-and Ombud represents such a challenge. Admittedly, this service is small and far from successful at the moment. However, I do think Ombud is on to something really interesting. If you are looking to find out more about a particular product or service, then you may find an actual user to be more knowledgeable than any analyst. In any case, this is a resource to consider and, at least for now, the only cost is your time-and, while you won't need to get budget approval to use it, finding the spare time could be almost as daunting a task. In any case, check out Ombud if you get a chance. It could give you a perspective on a product or vendor you can't get anyplace else. Rob Enderle is president and principal analyst of the Enderle Group. Previously, he was the Senior Research Fellow for Forrester Research and the Giga Information Group. Prior to that he worked for IBM and held positions in Internal Audit, Competitive Analysis, Marketing, Finance, and Security. Currently, Rob writes on emerging technology, security, and Linux for a wide variety of publications and appears on national news TV shows that include CNBC, FOX, Bloomberg and NPR. Follow everything from CIO.com on Twitter @CIOonline, on Facebook, and on Google +.