Stealth analyst firm reorganizations trigger the need for analyst list maintenance

Analyst firms are no different from any other company in that they go through periodic reorganizations. There are many reasons why firms reorganization, such as: 

• Changes in the tech marketplace which causes changes in analyst research coverage assignments as emerging technologies are added while declining/consolidating markets are dropped
• Acquisitions (e.g., Forrester buying JupiterResearch) that bring in new analysts, market coverages and services
• Modifications to the firm’s business model to go after new opportunities or exit poor markets

The problem for analyst relations (AR) professionals is that firms rarely tell clients or AR teams about these organization changes. This could dramatically decrease the efficiency and effectiveness of the analyst education effort as AR wastes time working with analysts that are no longer relevant while missing newly relevant analysts.

SageCircle Technique:

• Ask analysts in a casual manner during interactions (e.g., briefing and inquiry) whether the firm has recently gone through or is planning a

Your analyst list is likely wrong – half the analysts should not be on it, half that should are not

Having reviewed many analyst lists over the years, it never ceases to amazes us how such a very high percentage of them are wrong. The analyst relations (AR) team’s analyst list(s) are a critical success factor. Having a poorly constructed list means that AR professionals are missing important analysts and wasting time with non-relevant analysts. As a consequence, the AR team will find both its efficiency and effectiveness negatively impacted. In the most dire circumstances, having a poorly constructed list could also negatively impact an AR professional’s ability to keep their job.

 This post focuses on which analysts should be included or excluded from a list, not on ranking and tiering (see here for that discussion).

There are many reasons why any particular analyst list can be so wrong (in order of importance, most important first): 

• Perception that there is no time to do the work
• Lack of formal analyst list methodology
• Inadequate consideration of corporate, business group and team objectives
• Lack of carefully considered weighted criteria
• Infrequent review of the analyst marketplace for changes in analysts and coverage
• Lack of mechanism for capturing how analyst list decisions were made
• Focusing on large firms while giving boutiques short shrift
• No access to a database of analysts
• Internal political pressure
• External squeaky wheels

 Frankly, creating and maintaining an analyst list is not

Don’t listen to the squeaks when managing your analyst list

“The squeaky wheel gets the grease” is one of the hoariest clichés in the culture. When applied to building and managing analyst lists, it is also incredibly dangerous. 

Just because an analyst demands a briefing, access to your executives, or whatever, it does not mean that they should get it. What becomes difficult for analyst relations (AR) is when an analyst that is not getting what they want starts squeaking in order to get attention. The squeaks could be in the form of intemperate quotes in the press, back channel complaining to your executives, or other such actions. Their goal is to be annoying enough to get the briefing or the contract they want.

If AR is committed to the first of The 5 I’s of Analyst Relations, “Identify”, and the team has developed a standardized process for ranking and tiering analysts, and has a set of tools for list management, then it should be relatively easy to ignore the squeaks. Even an executive who is pushing for including an analyst on a list because of a few press quotes will likely concede that the analyst does not belong when presented with AR’s list methodology and audit trail. When it comes to tools, you can have a simple Word list with a list of analysts, their ranking and why. Or you can have something as detailed as SageCircle’s “Analyst List Workbook” SageTool^TM which gives you the ability to do “what-if” analysis by playing with the weights of criteria (click on graphic for a larger version of the workbook section for setting criteria weights).

AR teams that do not have a formal methodology and tools will often find themselves with an ever shifting analyst list based more on emotion and squeaks. An unstable analyst list makes