Analysts are more experienced, so why are there frustrated customers?

One of the myths about the analyst industry is that analysts used to be better and, in particular, more experienced. As a former analyst I’m tempted by this idea out of vanity but, broadly speaking, that’s not true.

Over recent years there’s been a slight upward trend in the work experience of analysts. We’ve seen quite a substantial increase in the percentage of veteran analysts, with over 15 years experiences. There is an even larger increase in the percentage of those with substantial prior experience. That’s reflected by Kea Company’s Analyst Attitude Survey, which is the survey of analysts with the largest sample size. Comparing our data from this year with those from 2011 and 2012 we can see that a real increase in the experience of analysts.

A subjective judgement flows from that: I’d say that today’s analysts also face new challenges: shorter, punchier research is demanded; more time is spent with clients, both on calls and face-to-face; and the growing demands of social media. Those are three of the biggest changes.

However, many users of analyst research complain more than ever before about the value they get from analysts. Our Analyst Value Survey is showing why. The picture is that the value, and the value for money, of analyst firms now varies massively. Some firms are finding it easy to give clients full-spectrum value, and others are failing. It’s not because of weaker analysts: it’s because of greater demands from clients and the way that mid-size upstarts are pushing the value curve upwards.

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