In the investment world there is a clear demarcation between sell-side and buy-side analysts. Been wondering whether the tech world needs something similar as I read various industry research and have conversations with several technology advisers.
Among the research I am referring to is Gartner’s Mid-Market ERP MQ and its cloud infrastructure MQ and“prolific Paul” Greenberg’s 6 part series on CRM vendors. I am puzzled I don’ t see NetSuite, Plex or other SaaS vendors in the Gartner mid-market MQ (the fine print says NetSuite was excluded since it mostly has “service-centric businesses, rather than product-centric businesses”. In fairness, the Gartner title does say “MQ for product-centric businesses”). In contrast I see what Paul calls the social “mainstream” with vendors like Jive and Lithium in his list. I see the Gartner’s cloud list and see it is co-mingled with more traditional hosting and has earned it the scorn of Bob Warfield and others for that lack of delineation.
I have also been talking to several advisers in the last few weeks. Many are ex Big 5 and now in smaller consulting firms, and they are coaching their clients on emerging technology trends. Many tell me it feels like the early 90s again – as companies evaluate a dizzying array of new and disruptive technologies.
Part of the reason companies are turning to such advisers is they do not have internal analysts who can take (or ignore) market assessments from Gartner, Paul, me and so many others and rationalize it to their unique industry and company needs. Most IT staffing has been cut to the bone – 80 to 90% of many IT and telecom budgets are now with external vendors. So, internal analysis today is often transactional and tactical.
But external advisers can only go so far. Buy-side analysts should be working with them during the technology evaluations and continue to add their focus during deployment with implementation partners.
How would such analysts be funded? The 80 to 90% spend with incumbent vendors is a motherlode of potential savings. Good buy-side analysts should be able to easily and quantifiably justify their budgets.