Analyze This

The lamentable corruption of some financial analysts should not taint the entire community. We know some good ones.
 
 
By John Sumser
 
If you’ve ever attended an industry trade show, you’ve run across the creatures who call themselves analysts. Like most technology segments, the HR landscape includes buyers, bloggers, vendors, technologists, pundits, and these analysts.  In one way of thinking, it’s not really an industry until it sprouts an analyst or two.
 
 
It’s a classic example of the business major’s answer to a philosophy question. When a tree falls in a forest, you can make money by listening to it. When a lot of trees are falling, an entire career path opens.
 
 
Two primary kinds of industry analyst exist: financial and otherwise. In the late 1990s, the financial analysts got in all sorts of trouble. It seems that they couldn’t figure out that it was bad form to rave about the firms their bank was investing in. Following regulations passed in the wake of the dot com crash (remember when financial crises were followed by big recoveries?), the behavior of these analysts was seriously curtailed.
 
 
Today, the “otherwise” analysts are ascendant. They come from many (mostly “other,” not always “wise”) sources. Gartner, IDC, and Aberdeen offer industry analyses in a variety of settings including HR. A number of powerful independent analysts hold sway over segments of the vendor community.
 
 
Strategy firms, such as TalentFunction and KnowledgeInfusion, are led by industry analysts who specialize in helping companies incorporate the latest market innovations. Niche-specific operations help clients navigate the peculiarities of recruitment process or overall HR outsourcing.
 
 
Major trade associations (SHRM and the Human Capital Institute) have analyst and research departments. Membership organizations (Bersin & Associates, the Corporate Leadership Council, the Conference Board, and SuccessFactors Inform division) offer research into best practices and hard data.
 
 
And, somewhat surprisingly, financial analysts are still making stock recommendations and divining industry futures. They have influence over aspiring public companies.
With 80,000 vendors and more than 1 million practitioners, the HR industry is an overwhelming maze. Working in the field effectively prevents you from having an adequate view of the totality. The rise of the analyst class can be directly traced to the unyielding growth in complexity in practices, innovations, and case specifics.
 
 
One’s needs for the services of an analyst are the result of trying to run an HR operation that is an effective competitive weapon. That is, if you want to run a white bread standard operation and make your market differentiation in other areas, you won’t need a sherpa. That’s what analysts are, after all—guides, outfitters, safari masters, forecasters, seers, soothsayers, or decision reinforcers.
 
 
Analysts are a critical and necessary component of our operating industry. Professional associations, tied as they are to events and old school publishing mentalities, are drowning in information. The analyst helps the industry separate the wheat from the chaff. They are our curators, the mediators of trends, technologies, and fads in the industry.
 
 
Maintaining objectivity is a challenging aspect of the analysts’ role. It’s not unusual to hear stories about corrupt foundations. With the vast supply from HR vendors trying to find purchase in an enormous sea of potential buyers, it’s not surprising to discover that a sort of chummy relationship exists between the two. Establishing a useful distance, without compromising one’s ability to clearly understand what’s going on, takes constant attention.
 
 
The truth is that familiarity makes it difficult to comprehend the new. Analysts, more than any other member of our ecosystem, have to spend their time making sure that they are seeing things clearly. The very best resist the temptation to rest on their laurels.
Late this fall, at the HRDemo show, we are convening the first ever HR Industry Analyst Summit. Rather than stretching them to be always-on-celebrities (as happens in their other public appearances), we’re asking them to join us for a thoughtful afternoon, pondering the structure and influence that analysts have on our industry. Then, we’ve asked them to hang with us at the HRDemo show to get to know participants and vendors in a relaxed setting.
 
 
So far, Lisa Rowan, Mark Schmit, Josh Bersin, Madeline Laurano, George Larocque, and Kevin Martin have agreed to join us. We’re expecting to see about a dozen of these industry luminaries at HRDemo.
 
 
Every other imaginable function in the industry has its professional association, trade group, retreat providers, gurus or Kumbaya song circle. We’re asking analysts to join us in Las Vegas this December to see what happens. I’ll let you know what we discover. 
 
 
John Sumser is a technology consultant, trade show producer, and webmaster of HRExaminer.com. He can be reached at john@johnsumser.com.