A tale of two analyst firms

I was delighted to hear the other day that CCS Insight continues to expand. It's launching a new consulting division, headed up by Thomas Reuner; hiring two new researchers in the core research business; and opening up a new office in Slough.

CCS Insight's decision to bring in Thomas to run the consulting business is consistent with the way the company has grown over the past two years. Bring in experienced individuals with good reputations who can hit the ground running and deliver value from day one. Thomas certainly fits that mould, as a former strategic consulting partner with IDC as well as stints with Gartner, NelsonHall and KPMG Consulting.

The Yankee Group layoffs were made the same week that Ben and I spoke. It's an interesting contrast. Both firms play in the same market, yet one is experiencing tremendous growth while the other is having to cut back costs drastically.

I've always wondered about Yankee's 'Anywhere' model. It struck me as another example of an analyst firm looking to create a differentiator and then trying to force its views on to the market.

I’m sure Yankee has also suffered from the increased competition in the analyst market. CCS Insight is just one of the smaller firms that have popped up in recent years. Staffed by senior-level, experienced analysts, these boutiques are hungry. They are able to provide a high-quality of service at a competitive price. The boutiques may not be able to provide the same breadth of coverage as Gartner or IDC but they can often compete very effectively in a particular niche or market sector.

Mind, the boutiques aren't having it all their own way. Some of the mid-sized firms are hitting back. Yankee might be shrinking but look at Analysys Mason. Since bringing in Tony Lavender from Ovum a couple of years ago, the company has transformed itself and is now reinforcing its position as a major player in the telecoms market.

No-one knows how the market will play out in the next few months or years. There will certainly be more victims as the economy continues its downward trend and some big, well-established names are likely to disappear. At the same time, we can hope that the boutiques will thrive – at least the good ones which are delivering what customers want.