Gene Hall of Gartner must feel like there is a hit out for him. Two weeks ago InformationWeek put him on its cover - with the title "Can you trust this man?" James Governor starts a flurry of blog chatter summarized in this ARmadgeddon post. I wrote about Gartner issues in this post.
The talk is about Gartner's independence and innovation. Gene has been focused on the other i - income. He was brought in to an entity which was poised to cross $ 1 billion in revenues before the turn of the century, and it may finally do so next year (2005 revenues were $ 989m). He has an organization with gross margins in the 50s (research is even richer in the 60s) and can barely make money (net income has been less than 3% last few years) primarily because it spends a whopping 40% of income on sales and marketing.
From what I hear he wants to expand the sales force to go more after the middle market. Lots of white space there, and his ADP background should help Gartner focus on what ADP called the "heartland" customer. The heartland is not as interested in innovation. It wants well packaged, affordable offerings. In consulting, the direction is actually to go the other way and bring in a lot more ex Big 5 senior consultants, focus on larger customers and increase the deal size. Big 5 types who learned to build large practices around Oracle or SAP are not as focused on independence. They are focused on revenues where sales and marketing cost 20% or less.
So ask Wall Street the InformationWeek question - Can you trust this man?. The stock just hit its 52 week high (in fact may have been a 52 month high).
Innovation and Independence come way below Income on Wall Street.
