I was asked, as we approach the end of the year, to talk about how the roles for an industry analyst had changed since I started and it is kind of amazing. In a strange way, those working at the large firms are more constrained and limited than when I was working for a firm, but the opportunities to be independent have become far more numerous and powerful—but only for those who developed both the skills and the brand image.
So how has my job has changed over the years?
This was the year I left IBM and went to work for Dataquest in the operating system unit. The rule basically was that as long as you brought in revenue, they pretty much left what you wrote about up to you. I learned a valuable lesson then—firms paid for the information they wanted to see; not the truth. This isn’t to say I did badly, because another reason companies paid you was to get influence. If they paid you, they could threaten to cut off payment if you didn’t toe the line.
I’d left IBM having access to and directing one of the largest research budgets the firm had ever funded. This was the work that was done to justify splitting off the IBM software unit. It fascinated me that inside the company much of this intelligence wasn’t considered valuable, because it seemed to disagree with what the executives wanted to believe. For instance, we could tell that the IBM user base was getting restless and wanted to move to other vendors largely because we’d been abusing them. But the executives wanted to believe that this was impossible, so they wouldn’t correct the problems until after a huge number of customers actually left. I believed the cause was that the internal and external reports differed, so when I went to Dataquest, I did a five-year operating system forecast based largely on what I already knew.
This was the year of Windows 95. Novell, UNIX and the MacOS were still relatively powerful, and Linux was still something new young employees used to piss off their bosses. I forecast the decline for everything but Windows. Novell, which had never been a customer before, signed up for a $75K account just so it could threaten to take it away if I didn’t change the forecast. IBM (which wasn’t pleased with the OS/2 prediction) said it would make sure I’d fail as an analyst. But I could defend the forecast and I didn’t change it, though it seemed I was in a race with the then CEO of Dataquest to see who would get fired first. She wasn’t a fan. But, as long as you could defend your position on a topic, you could hold it. So I didn’t get fired—though there were some close moments. Bill Gates personally had to step in and save my job once. (But, I should point out that IBM, not Microsoft, was Dataquest’s biggest customer at the time.)
Because I’d been part of several company failures that I believed happened because executives refused to see what was really going on in their companies, I had a reason to provide what I believed was the truth. Giga Information Group, a then new company representing Gideon Gartner’s concept of a third-generation research firm, was formed, with a hard separation among vendors, analysts and metrics based on writing—not on revenue. This turned out to be a wonderful place for me. Because Gates had saved my job, I felt honor bound to try to help save his company, and I could see it already making the same kind of mistakes that IBM had made a decade earlier. The Web didn’t yet exist as a power, and much of what we published was private, so I was allowed to be very critical. And, since much of what I said dovetailed with what enterprise customers needed (unlike at Dataquest, Giga was heavily funded by people who buy software), the coverage proved very popular. But it seemed to have little impact on Microsoft, which seemed to, in the process of disputing what I’d written, often just prove my point. I was allowed to expand my coverage, and I advanced rapidly. I reached the top research spot, senior research fellow, before leaving.
Just after I got that promotion, Forrester bought the company due to a board revolt. It didn’t do any retention and didn’t seem to understand the business we were in. I nearly (accidentally) got pulled into an adversarial relationship with Linux, mostly because the Linux analyst (who was eventually let go) refused to actually write anything. This was not a popular position, largely because Microsoft’s image had degraded far beyond what IBM had experienced. I’d been surprisingly ineffective at preventing them from making similar mistakes. And Linux was the white knight to the perceived evil of Windows. After seeing the writing on the wall, I resigned to form my own small firm.
2003 Enderle Group
Thanks to the Web, I could reach far more people, and many of the clients I’d had at Giga and Forrester supported me in the change. I’ve been lucky enough to retain most clients and gain new ones over the years. Ironically, I’m much more engaged in the process now, and I am likely far more effective at helping clients avoid past mistakes than when I was an analyst. Also, thanks to the Web, my reach is far greater than it has ever been before. Generally, I can write what I want—though some publications are sensitive to controversy because of the advertising pressures they are under.
I talk to my friends who are still in big firms, and I hear that they are constantly second-guessed and have been turned into paper mills, writing research note after research note—many of which may never be read. Salaries have dropped and raises are all but non-existent. Bonuses that were once reasonably easy to achieve are structured to be nearly impossible to reach and focus has heavily shifted back to revenue. But it seems that the influence of the firms has declined, both on the buy and sell side, because Web information is far more prevalent and advertising funded.
Wrapping Up: Proving My Mentor Wrong
There have been a number of ironies over the course of the years. One is that while IBM never seemed to want to listen to me while I was in the company, once I was an analyst, the same executives seemed to hang on my every word, even though I was pretty much saying the same thing I’d always said. At IBM, one of my mentors told me I would never be successful unless I specialized, but I’ve done alright without specializing. In fact, that is one of my big differentiators.
Over the years, a number of firms have tried to discredit me, but instead actually served to both drive reporters to me as the contrary voice or helped me manage my workload instead. If it wasn’t for them limiting me, I’d likely have died from overwork. I started out thinking about how many operating systems would be sold and end up thinking about things ranging from self-driving cars to AI systems and I still have time to cover mobile devices, Big Data, corporate drama and emerging technology. I do worry that at some point a robot may be able to do what I do better, but I think I’m safe for now and I’m pretty happy. Go figure.
I hope you are enjoying your holiday week!
Rob Enderle is President and Principal Analyst of the Enderle Group, a forward-looking emerging technology advisory firm. With over 30 years’ experience in emerging technologies, he has provided regional and global companies with guidance in how to better target customer needs; create new business opportunities; anticipate technology changes; select vendors and products; and present their products in the best possible light. Rob covers the technology industry broadly. Before founding the Enderle Group, Rob was the Senior Research Fellow for Forrester Research and the Giga Information Group, and held senior positions at IBM and ROLM. Follow Rob on Twitter @enderle, on Facebook and on Google+