The Analyst Paradox

February 24th, 2006 at 07:54am David Bush - Iasta

Recently, Procuri made an interesting strategic hire by pulling Tim Minahan from Aberdeen. Procuri’s CEO, Mark Morel, was quoted on Spend Matters, which you can read here. Whether we believe his statements or not, it is critical that everyone realize that Tim is bringing over a wealth of competitive insight into his new role, even if he does not share competitive secrets he received under NDA. This is not a personal issue — I would be much more upset if I were Ariba or Emptoris, for instance. Tim knows plenty about Iasta, but little compared with what he knows about the high-priced heavyweights and their future directions and strategies, who have more time to dedicate to working with the analysts. Also, we can all agree that the shelf-life for competitive knowledge is pretty limited in such a fast moving industry.

Regardless, Tim going to a vendor means that a gold mine of insider knowledge – even if he opts not to share it explicitly with his new company – will go with him. This brings my attention to what I like to think of as the Analyst Paradox. To wit, vendors need analysts to promote their value proposition and perspective. But in the process, they give up truckloads of information and are often pressed during briefings to answer very sensitive questions which can then be re-sold to direct competitors as market insight (this happens all of the time in competitive private studies the analyst firms do for clients). It is a very tough call on what to do because these companies can offer a lot of help and attention. But the question is…at what price?

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Entry Filed under: Analysts/Research, General, e-Sourcing Marketplace