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Thursday, November 06, 2014

The rise of the Independent Analyst / Expert - The telecoms industry needs industry research diversity

Tomorrow, I'm speaking at the inaugural "Great Telco Debate", run by Chris Lewis and Graham Wilde, and focusing on big-picture strategy issues for network operators. Also on the roster are various other long-time analysts and telecom industry commentators, including people I've known for years such as Pim Bilderbeek, Benoit Felten, Caroline Gabriel and my regular colleague / Twitter protagonist Martin Geddes. Next week, I'm running a track at Alan Quayle's TADSummit event, as well, which is aimed at creating a telecoms application development community.

The common theme here is independence. Chris, Martin, Alan, Caroline, Benoit, Pim and our peers have all worked for larger companies, typically analysis or consulting firms. We now run our own gigs, sometimes on our own, sometimes with partners or associates on a tactical basis. The Great Telco Debate features a host of independent analysts.

All of us are outspoken. In fact, Chris has called his conference company "Outspoken Events". All of us have a track record of being right - not always, not everywhere, but with a far better level of accuracy than many in the analyst industry. (Alan and Martin refuse to be called analysts, in fact - reflecting the dubious quality of some punditry in the telecoms sector).

Yet while organisations like the IIAR give some airtime to those of us lower down the size scale from the behemoths like Gartner and IDC, this recognition and engagement is patchy. Today I'm with Ericsson in Stockholm, with a number of other independent or small-firm peers. Despite my regular criticism of some technologies and strategies, it's a company that seems to appreciate a diversity of opinion. I was speaking at a Metaswitch customer event on Tuesday, another vendor which goes beyond the "big guys". Last week, I took part in some hosted events for groups of investors, organised by my financial-analyst telecom-sector counterparts at Barclays, who like bringing in experts on particular topical themes - in this case, I was discussing Apple's SIM card and its implications.

However, some other vendors, operators, regulators, enterprise end-users and broader ecosystem participants often do not look beyond the largest names, like Gartner, Forrester, IDC, Infonetics, 451/Yankee, Informa, ABI, AnalysysMason and their peers. While I'm not denigrating those companies, they tend to be less contrarian, less prone to risky visions that might prove wrong, and more willing to repeat industry "standard" mantras. Look back at years of hype and hockey-stick curves about RCS, mobile payments, mobile TV, the spurious tabloid-headline "battle vs. the OTTs" and so on. Identify the cheerleaders and the critics.

There have usually been a few small boys pointing out the naked emperors, but only rarely do they come from the large firms. On the other side, few of the bigger houses are adept at spotting or predicting the next thing either, as their structure makes it hard to spot cross-silo trends. My own claimed scalps have included highlighting the potential of small cells, WiFi offload, WebRTC and Telco-OTT before any other analyst. Martin Geddes and I championed "the future of voice" long before it became a trend.

The problem is that much of the "analyst" world is aimed at enterprise IT, where "influence" is all-important and easier to discern and isolate - much of it is directly about buyers choosing between vendors in specific categories of IT. The telecoms part of the analyst business is different, as the buyers are largely themselves in the technology industry as well. The role of standards - which may well be slow to evolve or plain wrongly-focused - is much higher in telecoms and networking, than in enterprise computing, applications and IT. Willingness to criticise standards, as well as companies, is important.

My view and aspiration (yes, it's self-serving too) is that companies in the telecoms industry should restrict their industry research budget to a maximum of 50% spend on the generic, "standardised" options from the big analyst houses. The rest - just as with telecoms R&D spend on new technologies, platforms and services - needs to go to innovative and disruptive thinkers, whether that's in the form of traditional research reports, or more workshop/brainstorm forms of engagement and provocation. 

You don't need to agree with us. And you might not want to use our output to give stats for your "rubber-stamp" internal business plans, or press releases hyping the next (failure-inevitable) thing. But you do need true independent thoughts to really catalyse change. Service innovation has largely failed in telecoms - it has been too "consensus" driven, too political, too slow and too rooted in engineering mentality rather than design. You don't often get told painful truths by the larger firms - they tend to pull their punches. "Anti-forecasting" what won't happen is as important as predicting what will - opportunity costs are increasing in the Internet era, so fruitless quests need to be spotted early and abandoned.

To spot opportunities, and painful problems, you need blue-sky thinking and contrarian musing, and practical, real-world advice on creating "the new". You need to spot the second-order problems before the first-order ones are fixed, or else you'll add in years of additional cycles and time-to-market. You need to know when to push back against industry organisations and standards bodies, and when to steer them in particular directions if possible. You need to make sure that your CEO avoids trite sound-bites and questionable statistics. You need someone who'll tell you that correlation and causation are different.

I list below some of the companies that fall into the independent analyst category. These are ones where I know the principles in real life or interact with them online. People who are opinionated, and able to challenge the status quo and consensus view. There are plenty more where I don't know the specific individuals. Some of them compete with me, but I think it's important to recognise the collective wisdom and insight of the independent analyst community, and so I'm happy to name-check them here. 

Indeed, some have very different viewpoints to mine as well - as many battles on Twitter or conference panel sessions will attest. But in my view, that's healthy - when was the last time you saw two representatives of big analyst firms have a proper gloves-off argument about who's right?

Alan Quayle Business & Service Development
Chris Lewis Insight
Core Analysis
Diffraction Analysis
Geddes Consulting 
Jackdaw Research
Nemertes Research 
PKE Consulting
Rewheel Research 
Strand Consult
Telco 2.0 / STL Partners

And of course, there's my own company Disruptive Analysis (yes, I know the website is awful.... when I have time I'll sort it...). If you're reading this blog, you probably already know me - I'm called @disruptivedean for a reason.

The bottom line is this: the telecoms industry cannot afford just to read, or hear about, consensus views, from a handful of big firms saying much the same thing. Diversity of opinion, vision, concern and suggestion is paramount. Telcos, vendors and others all need a breadth of inputs. Assigning at least 50% of industry research budget to independent, flexible thinkers is a good metric to aim for, to help attain this. We may not have a collective voice or slick sales and marketing machines - but that's because we don't want to have to feed the machine with generic output.

1 comment:

Jonas Lind said...

Absolutely right. Top decision makers need to hear truths that disturb groupthink and upset their worldview. The king needs a fool who whisper in his ears what no one else dares to say.

This is the fundamental insight from the field of Competitive Intelligence and futurism. The founder of scenario planning, Peter Schwartz, worked for Shell in the 1970s and 1980s. They regularly involved the entire senior management in extensive scenario workshops. For example, when the oil crisis hit the market in 1973, Shell’s management had already worked through this scenario and they were mentally prepared. Shell’s intelligence team correctly predicted the fall of the Soviet Union in 1989-1990, CIA missed it. Peter Schwartz’s advice for a successful intelligence function is to avoid groupthink, identify “blind spots” in your worldview, listen to dissenting voices and look for early “weak signals” for future change.

Unfortunately, this open mindedness is on its way out in the top corporate world today. When every possible information is available on the Net, the willingness to listen seems to be lower and lower. Here is an article about the decline of Strategic Intelligence: http://www.theatlantic.com/international/archive/2012/04/peak-intel-how-so-called-strategic-intelligence-actually-makes-us-dumber/255413/

PS. Why not include Tomi Ahonen in the list?