David’s got a great post on the tech research house of cards. I don’t know of any industry other than tech in which such "corrupting" business practices exist. The problem I have with it isn’t the people – there are lots of great, honest analysts out there. Just like there are plenty of great, honest PR folks. He points to a recent edition of the Internet Acceleration newsletter which is worth a read…
What isn’t OK is the business practice of pay-for-play masquerading as independent consultancy. The only equity in it is that this model punishes big and small alike. The big have to keep fueling the beast and where they don’t they suddenly see their rankings plummet and adverse commentary. The small can’t afford to really play at all.
What will it take for the industry to really start talking about this issue? Maybe a little more chatter in the blogosphere? We just need more people to step up.
This is something the financial analyst community has had to deal with in spades. They’ve had to build walls and processes where none existed before. They’ve been held into account, sued and fined. Where’s Spitzer when you need him?
Here are some starter thoughts:
- As an industry we launch the Industry Research Transparency Portal:- companies would log what I suggest in 2). It would also be the major portal for filing complaints and reviewing research. All analysts would be able to submit research papers for peer and industry review. And vendors would be able to do the same. This is something that social networking technologies really enable. The IRTP mark would become a quality mark that could be applied to research over time. The IRTP board would consist of CIOs.
- All major companies launch a Industry Research Transparency Site:- this site would disclose who is spending what with who.
The simplest solution is that all companies suspend payments to any company engaging in research of it. In other words, all companies unanimously agree not to pay-to-play. This is also the most unlikely given that most large firms have a heavy dependency on company revenue (both consulting and reports). And, there are many analysts that add an enormous amount of value to technology and marketing efforts. What is likely though is that the current status-quo won’t continue – the winds of transparency are blowing into every corner of tech.