AR Institute launches on LinkedIn.com

The Institute of Industry Analyst Relations has expanded onto LinkedIn, the main business networking site.

The new IIAR group allows AR professionals to connect with each other, and allows members to pass on connections and requests for information to other people on LinkedIn. The site lists more than 500 current contacts at each of the major analyst firms: Forrester, Gartner and IDC, making is a useful tool for professionals wanting to better understand analysts interests and connections.

IIAR members will be getting invites by email over the next few days.

AMR Research comes under the spotlight in January

Our first Advisor Spotlight webinar in 2008 will discuss AMR Research, the leading analyst firm focussed on the supply chain. AMR has shown an interesting evolution over the last year. It increasingly speaks about the "value chain", and has broadened its research interests out to intersections of business, ERP and supply processes.

It's also made some interesting hires recently, including David Aquino, David Brown, Noha Tohamy and, most recently, Jonathan Yarmis as Vice President.

The call will be on Thursday January 17 2008 at
- 8 am Pacific
- 11 am Eastern
- 4 pm Britain
- 5 pm Central Europe
- 6 pm Finland, Israel.

As in each monthly interactive webinar, this discussion will give Lighthouse's insight into developments of the firm being discussed that month. We'll share our most recent into the firm's research interests, customer base and international reach. We'll also review the impact of this year's changes on the firm, and the firm's relative influence on end-users.

Register at http://www.etickets.to/buy/?e=720. Lighthouse AR Intranet subscribers get free seats.

Credo 2: AR is the marketing of ideas to analysts

Analyst relations is a marketing activity, in more ways than one. Analyst relations is normally part of the marketing department of companies. And, if marketing is the process of identifying, anticipating and satisfying consumers' requirements, then analyst relations is the process of identifying, anticipating and satisfying analysts' actual needs (and not only their explicit needs, but also what we can observe to be their tacit needs).

Most importantly, analyst relations is a marketing discipline. Brand consistency is very important, especially with complex organisations where the solutions change so often that the brand promise has to subsist in the experience of being a customer, and not just in the experience of using the solution.

Co-ordinating the messages of spokespeople with the rest of the organisation is also a marketing activity. Many spokespeople focus on their own narrow slice of the organisation. When speaking with analysts, however, they can struggle to join up the picture with the firm's firm of the market. Instead of focussing on the way in which technology is developing, spokespeople need to focus on what is changing in the customer community. That's a tricky standpoint to master, and one that requires a marketing standpoint. We'll take about that more when we discuss the third credo next week.

Because AR can play a powerful role in testing and developing messages, it's often best if AR is part of the marketing organisation. However there's a difference between marketing and the marketing department. If marketing is about identifying, anticipating and satisfying consumers' requirements then the marketing process is most organisations is in product management, and not in the so-called marketing department. What is called marketing is often only promotion.

If the marketing department is disconnected from the whole marketing process, then AR has to try to connect up outside the marketing department, and especially link into business development and product management. AR has to maximise the alignment between AR the rest of the organization. Our view is the focus has to be on marketing, the process of understanding and meeting needs. However, that means sometimes tensions will exist between AR and the the marketing department.

Those tensions are especially common because at lot of marketing is aspirational: it relates to where the customer or the supplier would like to be, and often that does not reflect that the client really needs, or what the vendor can actually offer. AR managers need to steer away from aspirations, and instead focus on realities. Messages should be based on solid facts and on the very best case studies. And they also need to be used as the basis for discussion, rather than served up like still-life sculptures. We'll talk about that more in the third Credo, that messages need to be the basis for two-way communication within the vendor organisation.

Verizon gets the 3rd spot in the Lighthouse Telecoms Index

US-headquartered operator Verizon has moved to the 3rd spot this month in the Lighthouse Telecoms Index edging out Ericsson. Apart from reporting a strong 3rd quarter growth the firm has also topped the Uptime Institute's list of most reliable data centers.

Nortel, recognized by Gartner as a leader in the SONET Equipment market, has also moved up 2 positions this month and is now at the 5th spot.

The biggest mover this month is PCCW which has jumped up 11 spots and is the only firm this month to enter the top 25. The firm is ranked as having the second largest subscriber base of IPTV services and is the focus of telecom analysts describing the Hong Kong mobile market. Extreme Networks has jumped up 9 positions based on news about some great financial growth and new products. Enterasys which announced a new 10 Gigabit Intrusion Detection & Prevention System has also gone up 9 positions and is now at the 40th spot.

Brocade is the biggest loser this month as it dips to the 43rd position which is the lowest it has gone since February 2007. The firm has announced new features in its flagship Brocade 48000 Director product but apparently has yet to get analysts talking about it. Cingular, which slipped out of the Telecoms top 25 last month, has lost another 7 positions and is now ranked at the 33rd spot. Motorola, which slipped 1 position last month, has dropped another 2 spots this month and is now ranked at the 7th position. Hopefully its strategic investments in ViVOtech and expansion in EMEA region will help it regain lost ground in the coming months. ZTE is the only firm to have dropped out of the top 25 as it lost 1 position and is now ranked at 26th spot.

If you wish to be sent the top 25 firms in Telecoms Index each month, email us at analysts at lighthousear dot com. You can also read how we do our Analyst Index rankings, subscribe to our Spotlight service for new and interesting analyst research or register for our monthly Advisor Spotlight Webinars.

Webinar to explain PAC's rapid rise

The final 'Advisor Spotlight' webinar of 2007 will focus on PAC and its rising influence. Pierre Audoin Consultants is one of Europe's oldest analyst firms. Its unique staffing model means that its analysts work as researchers, consultants and account managers for their topics. This deep domain experience and strong client rapport means PAC has been one of the greatest gainers from the current boom in custom consulting projects.

The webinar will be on Thursday December 20. To book your seat, visit us at www.acteva.com/go/ar. Lighthouse AR Intranet subscribers get free seats.

Acquisition news helps Business Objects gain in the Lighthouse Software Index

Business Objects is the highest riser in the top-teir of the Lighthouse Software Index this month. It has jumped up 6 positions. Its standing has certainly been helped by news of SAP's proposed acquisition of the firm. Salesforce.com which has just announced entering the 'Application Performance' market has also gained 3 spots. With a modest gain of 1 position, Sage is the only new entrant to the top 25 this month.

However, the open source database provider mySQL is the star this month as it is the biggest mover in the top 50 of the Lighthouse Software Index. The firm, which is increasing its presence in Italy, has shot up 17 positions this month and is now ranked at the 28th spot. Entrust (+15) is the second biggest mover as it extends its portfolio by adding support for e-passports. SAS Institute has moved up 12 spots as it gains attention for its renewed focus on performance management applications.

The biggest loser this month in the top 50 firms is i2 which has just announced that quarterly net earnings were $5 million less than the same quarter last year. The firm has dropped 12 positions and is now at the 45th spot. Compuware has also dropped 10 spots, even though it announced a much better performance this quarter. Informatica, the biggest loser in the top 25 firms, has fallen 7 positions even though it has been mentioned as a leader in its Magic Quadrant for Data Integration Tools report. Mercury, which was acquired by HP last year, has lost 6 positions as its brand continues to lose its strength. The firm has dropped out of the top 25 and is now at the 26th spot.

If you wish to be sent the top 25 firms in Software Index each month, email us at analysts at lighthousear dot com. You can also read how we do our Analyst Index rankings, subscribe to our Spotlight service for new and interesting analyst research or register for our monthly Advisor Spotlight Webinars.

Forrester's mammoth AR Survey: why reply?

Reedwan Iqbal is conducting Forrester's "AR Annual Budget Survey", which seems to be a new Forrester survey of AR budgets and costs at global and regional AR teams. Our clients received invites mid-week, and were asked to reply by Tuesday next week.

While the use of the data has not been finalised, Iqbal explains that Forrester "currently intend that the results will drive some reports on cost-effective analyst relations and we will happily provide a summary of one of them to" participants.

First things first. It's a wild survey. I worked my way though over 150 questions, and then saw that I was still only half way through. How big is this thing??

It reminds me of those diners where the food is free if you can eat everything on the menu. Who does that?? But in this case the incentive is so modest [a summary of one report, when Forrester already gives away whole slide decks], and the effort is not in line with the reward.

Furthermore, there's no suggestion that participants will get a summary of the data, or even something as simple as a comparison of their responses with the average. That breaches the common practise of analyst firms. It also runs against the principle of reciprocity. As a result, they will have a weaker sample with greater self-selection.

My other main observation is about the pace: one week to collect the data. That says a lot about the importance placed in this study. Since a major criticism of Forrester AR research has been the small and non-random sample sizes, it's interesting that they are not taking more time with such a difficult survey.

Monday: another chance for our webinar on Ovum

The rapid pace of change at Ovum means that clients has asked us to schedule an extra time for our Advisor Spotlight webinar on Ovum.

As with all our Advisor Spotlight sessions, we will discuss Ovum's evolution, new services, target markets and pricing challenges. However, we'll also discuss if Ovum should be put up for sale, and whether Yankee would be a good purchaser.

You can book online for the new option, which is at 11 Eastern time on Monday. That's 4 pm in Britain and 17hoo on mainland Europe.

AMD makes it to the top 10 in the Lighthouse Systems Index

Advanced Micro Devices (AMD) is the biggest mover this month as it gained 6 positions to land itself on the 10th spot. The firm has enjoyed excellent financial results and analysts seem quite interested in its strategy regarding quad-core x86 processors. NEC has also jumped up 4 positions and is now at 6th spot. The firm continues to enjoy strong growth due to innovative products and has also launched the world's fastest vector super computer. EMC's announcement to acquire Berkeley Data has also helped it to nudge 2 places up. Freescale, one of the largest manufacturers of embedded semi-conductors has announced the opening of a new design center in China and has jumped up 5 positions.

Hitachi, the firm that had made it to the top 10 just last month, has dropped down 5 positions this month. Although the firm is a global electronics giant it is having a hard time competing with the likes of Dell, HP and Lenovo in the personal computers business and is pulling out of the household computer business. Qualcomm which has just launched its new Go Anywhere chip has also dropped down 5 spots.

If you wish to be sent the top 25 firms in Systems Index each month, email us at analysts at lighthousear dot com. You can also read how we do our Analyst Index rankings, subscribe to our Spotlight service for new and interesting analyst research or register for our monthly Advisor Spotlight Webinars.

Credo 1.1 A case study in aggression

In following on from my first Credo, I have received independent confirmation from an analysts that there is no win from being aggressive. And vendors should be vigilant about finding out how their AR managers and agencies are treating analysts. It's the old one isn't it - one satisfied customer has much less impact than one dissatisfied customer.

Of course, if some analysts receive good service from an AR/PR managers they always make sure the tell the CEO or CMO that they are doing a good job. Some are very diligent about doing that, including the analyst who wrote for us last month, who has just sent me an update, which I have edited to protect the guilty...

Just to give you some context, this analyst's lukewarm findings about one vendor have been used by the vendor's PR [curious, but perhaps they are struggling to get anything to say out of the business so they have to rely on analysts]. Unsurprisingly, journalists sensed that behind the analysts tepid words was deeper concern. As a result, the PR adventure produced some negative media coverage and, for some reason, the PR tried to put the blame on the analysts rather than accept the responsibility for using tepid research.

There's a second moral to this story: that analyst relations has to be responsible to the marketing organisation, and we'll discuss that in Credo 2.

=====

Their PR just sent me a flaming email. I think the PR is under the delusion that I am another PR (despite me pointing out I am an analyst). The email was

• a) a personal attack
• b) full of typos
• c) also threatened me.

Don't know which I find most offensive. Never heard anything like it have you? I'm now considering my options. What would you suggest? My initial reaction was informing the executives what an idiot their PR is. I'm prepared to take their criticisms on the chin, but

• a) they are bringing into question my professionalism and
• b) I think analysts are allowed to objectionable opinions - it's part of the job description.

But have you ever heard of such a combative PR? Aren't they supposed to work with us and try and persuade us to their way of thinking?

Even now after all these years I'm still learning. And I am learning some new, painful lessons from this experience. It started with me helping someone out, followed by lots of misunderstanding and ended with a very horrid little PR.

I know my job means I don't want to upset the vendors involved, but I will plot my revenge on the PR.

I'll think twice before agreeing to let them use anything I write.

The thing is that a good AR would have said: right, time out. Sorry we were a bit rude. Now let's figure out how we can all win from this situation. Arranged a coffee/lunch and then indoctrinated me with their messaging. I was up for covering the firm in a new analyst report I'm just about to write, but now: touch-now-bargepole-won't-with (arrange in order)

What a mess. Oh I know I'll laugh about it tomorrow... What do you do when everything goes horribly wrong and then someone decides to be really rather rude.

P.S. To read more about this AR nightmare, read the original post.

Fujitsu Services surges up to enter the top 25 in the Lighthouse Services Index

Fujitsu Services is the biggest mover this month and has entered the top 25. The firm is moving to expand in the Nordic region by acquiring the Swedish firm Mandator. Analyst firms are also focusing on the recent outsourcing contracts awarded to Fujitsu which will hopefully propel the firm further in the coming months.

BT Global Services which has just announced some great financial results has gained 4 spots and is now ranked at the 18th spot. IBM Global Services has also gained as analysts focus on the firm due to its position as the world's largest IT outsourcing services provider. The firm has jumped up 3 positions and is now ranked at 8th spot. Tata Consultancy Services (TCS) has also gained 2 spots and is now at the 12th spot. The firm has gained attention of analysts by announcing the expansion of it operations in South Africa and has won one of the largest BPO contracts announced this year.

Dimension Data, which had just entered the top 25 last month, has dropped 6 positions this month and is now ranked at the 30th spot. The firm has recently acquired Accelon, a communications services company operating in Ghana and Nigeria. It will be interesting to see if the news has any impact on the firm's standing next month. BearingPoint, named as one of the "Top 10 Most Trusted Management Consulting Firms" in China, has also lost 3 positions. Siemens continues to expand its operations in Europe and the US, but Siemens Business Services is being mentioned less frequently in analyst research and is down 3 spots mainly because that business is now known as Siemens IT Solutions and Services.

If you wish to be sent the top 25 firms in Services Index each month, email us at analysts at lighthousear dot com. You can also read how we do our Analyst Index rankings, subscribe to our Spotlight service for new and interesting analyst research or register for our monthly Advisor Spotlight Webinars.

Tadpole appoints Lighthouse's Bolitho as director

One of the UK's top 100 tech firms has a new director: John Bolitho, one of Lighthouse's board members. Bolitho is joining Tadpole Technology plc as a non-executive director. Tadpole is one of the corporations included in the FTSE techMark 100 stock market index.

Lighthouse's board meets on the 22nd of this month and this month we'll be able to toast first to our customers' success - and then to John's. His growing string of board positions (another directorship is Seven Dials) reflects the value of his insight. John has been on Lighthouse's board since it was formed, and his guidance has been especially valuable while the firm has developed its subscription services over the last year.

Penteo: a case study in defendable borders

I had an interesting meeting yesterday with Penteo, the main analyst house in Spain. It's a deeply influential firm: almost all its revenue comes from end-users; it is independent, and is seen to be independent; its business model is based on deep relationships, meaning that it has strong customer loyalty.

Penteo is, in many ways, the archetype for the analyst firm that 'owns' a national market. Other analyst firms outside the English-speaking world will be well advised to learn from it. Over 14 years the firm has focussed on building itself as both a research and advisory firm, and as the host of the Penteo forum for CIOs. The Penteo forum groups together Spain's best known heavy users of IT from the public, commercial and academic worlds. I can't think of any firm, in any country, that has such dominance in its domestic market.

Penteo's dominance partly because of its tight focus on helping clients to improve themselves against benchmarks for the purchase, implementation and management: the strategy is explained very clearly by the firm's president (and how many firms could explain their strategy so clearly?). It is as if Penteo and its clients are in a permanent action research process aimed to optimise the technology that drives their business. In contrast, other analyst firms watch markets dispassionately and are less likely to consider themselves partisans of optimising measurable business outcomes.

It's a unique business model, which allows Penteo to strongly defend its market position: it already has the advantage of national, linguistic, cultural and other barriers to entry which English-speaking firms will not often want to cross. The extreme stability if its business model is in some contrast to that of Forrester and Gartner, which delight those customers seeking change.

Furthermore, because overseas firms operating in Spain may tend to bring in outside analyst firms, Penteo has a strong focus on Spanish-headquartered firms. In particular, that gives it a very strong position in the upper mid-market and mid-market in Spain. It would be almost impossible to uproot Penteo.

However, take away those national defences, and Penteo still has a highly distinctive business model which is hard to copy: a real research firm (unlike the procurement firms); a singular focus on end-users (most firms have a mixture); community is at the heart of the business model (unlike events businesses, which are a cross-sell); and the building of deep, career-long, client relationships (unlike the transactional, one-by-one approach of other firms).

There are some other things that one could imagine about Penteo: as a premium-service incumbent in a less-than-competitive high-growth market, it is a company that (I guess) can comfortably make strategic investments in growth.

And that is where it gets interesting. Penteo's website mentions that offices in London and Paris are coming soon. These are seemingly developed markets: highly valuable, but hard to crack. It will require strong, patient work to build up the market position of any new entrant. But, of course, most firms funded by outside equity will shy away from medium-term investments - meaning that few try. Firms with a long 'time orientation' and a low opportunity cost of capital, on the other hand, could make it work.