The Top 5: AR Metrics Mistakes

AR Metrics & MeasurementOrganizations that use the Balanced Scorecard to report the effectiveness of their interactions with influencers often make their lives more difficult and the Scorecard less useful by picking the wrong items to measure. This Top 5 looks at issues surrounding the selection of metrics to put into the Balanced Scorecard.

5) Not picking items whose data collection can be out-tasked. Because data collection can be burdensome, managers should pick some items for the Scorecard whose data collection can be out-tasked (e.g., a clipping service for analyst quotes or a consulting firm for AR effectiveness surveys).

4) Picking items to measure that are too granular and thus too difficult to gather. A classic problem is picking metrics that require a significant amount of work to collect, analyze and report. This leads to the Balanced Scorecard being dropped from the regular activity list.

3) Not picking items that dovetail with corporate and departmental goals. A Balanced Scorecard can lose its relevance quickly if Continue reading

Defining “executive sponsorship”

n: Executive sponsorship is a formal program where executives take an active part in establishing AR goals and priorities, providing the resources necessary to achieving the agreed upon goals, explicitly communicating the importance of AR to the company, providing timely support when an internal organizational hurdle prevents the achievement of goals and making themselves available as spokespeople with analysts.

The key theme is active participation.

NCVI are the four most important letters in the English alphabet for a Gartner sales rep

icon-budget-cuts-105w.jpgKnowledge is power when it comes to purchasing decisions about analyst firm contracts. Unfortunately, too many contract managers do not understand many of the underlying behavioral drivers when it comes to dealing with Gartner sales representatives, which puts those managers at a disadvantage. 

For instance, an important piece of information is that Gartner reps are measured on NCVI, net contract value increase. NCVI is calculated based only on the total syndicated research revenues, seats, and clusters. Other purchases such as event sponsorships, consulting or SAS are not included in the calculation.

Gartner sales reps that achieve NCVI are golden. Those reps whose client contracts are less than the prior year’s amount are in danger of termination. That is why Gartner sales reps start getting desperate when it looks like contract renewals are going to be less than the previous contract.

It is possible to reduce spending – notice we did not say “save money” – with Gartner without damaging the ability to access analysts for influencing purposes. However, it is not as simple as trying to negotiate a better discount from the sales rep, which is quite difficult because of the pricing discipline mandated by Gartner’s CEO. Rather it takes intelligence about Gartner’s business and sales practices to know what Continue reading

Carter interviewed on John Simonds’ AR podcast about the state of AR

icon-microphone-reduced-v-2.jpgIBM AR manager extraordinaire John Simonds (Twitter handle) interviewed Carter for his podcast series about AR that he posts on his  “Delusions of Adequacy” blog.  Topics we discussed were:

  • What is the state of A/R right now?
  • What is a good A/R practice/best practice?
  • What is a bad A/R practice or incident that we can learn from (without names)?
  • What could the A/R industry do to improve?

For the good and bad AR practices questions Carter looked at  both an AR practitioner practice and an AR management practice.

It was a fun and interesting discussion. Please visit  Podcast: An Analyst’s View of Analyst Relations – Carter Lusher of SageCircle to hear the interview.

Saving money on your Gartner and Forrester contracts is a year round activity

icon-budget-cuts-105w.jpgSageCircle is handling more and more client inquiries about how to reduce the cost of Forrester and Gartner contracts.  One aspect jumps out: too many purchasing managers (e.g., AR, market research, or procurement.) focus on managing costs mainly at contract renewal time. The reality is that saving money needs to be a focus each month of the contract, both to manage incremental spending but to also set the stage for the next contract renewal. 

What many vendors do not recognize sufficiently is that the Big Two account teams are scouring the vendors for additional budgets to tap with a sale of an Advisory seat here or some Service Units there. In some cases, the incremental purchases can easily add up 50% of the original contract. This can be very wasteful if the individual doing the purchasing does not how to be a good research consumer (very likely), does not use the resource after the initial couple of weeks (more likely) or buys something this already available in other parts of the company (regrettably likely). Because there is rarely a line item in the chart of accounts for analyst services, it can be very difficult to track these purchases.

Contract managers need to constantly work on monitoring actual utilization of the services in the prime contract. This includes making sure that Continue reading

Leverage the existing sales infrastructure, don’t reinvent the wheel

icon-dollar-euro.jpgOne of SageCircle’s recommendations for AR programs thinking about launching an AR-Sales Partnership Program is to leverage the existing sales infrastructure for training, information distribution, and sales support. These are all critical aspects of creating a partnership, but AR simply does not have the resources to reinvent what the sales organization has already built. In addition, sales representatives will be much more likely to work within their existing system than to add other communications methods. 

SageCircle Technique:

  • Add an AR-Sales Partnership element to your regular AR Strategic and Tactical Plan including goals for the year
  • Start with a modest pilot project (SageCircle clients can request a copy of the “Simple Steps for Starting an AR-Sales Program”)
  • Identify the key players inside the Continue reading

Saving money on contracts with the Forrester / Gartner duopoly is not simple

icon-budget-cuts-105w.jpgA common client inquiry we receive is in the context of someone negotiating with Gartner. Our clients want to know why in the midst of a terrible economic downturn, when vendors are cutting budgets left and right, that Gartner does not exhibit greater flexibility (i.e., cut prices) when it comes to contract negotiations. The short answer is that due to its end-user advisory market dominance – we estimate that Gartner has ~70% of the end user contracts – it does not have to be flexible. 

However, this issue is a little more complex than slapping a “monopolist” tag on folks over on Top Gallant Road. The reality is that there is an effective duopoly with tacit partner Forrester which gives them both the flexibility to be inflexible with it comes to negotiations. The last time this market saw pricing and packaging that in anyway favored the buyer was the mid-90’s when Giga and later META used significantly lower prices and “all you can eat” research seats to take market share from Gartner and Forrester. Alas, today there are no such firms that can play that role to counter Gartner and Forrester. As a consequence, the Big Two’s CEOs habitually inform Wall Street that they are maintaining their pricing and discounting discipline.

However, it is possible to reduce spending – notice we did not say “save money” – with the Forrester / Gartner duopoly without damaging the ability to access analysts for influencing purposes. However, it is not as simple as trying to wrangle a better discount from the sales rep. Rather it takes:

  • Knowledge about the firms’ business models
  • Knowledge about the firms’ research methodology and analyst culture
  • Knowledge about the true business value of Continue reading
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