Yet Another Magic Quadrant. Sigh.
January 13, 2009
The notion of a magic quadrant originated with the Boston Consulting Group. The original notion was to depict products in a strategic concept. In the 1970s, BCG caught Booz, Allen & Hamilton (the pre break up version of this blue chip firm) was in a tizzy because the BCG people had a secret weapon that left our consultants looking out of touch. The secret weapon depicted an X and Y axis. The X axis showed market share and the Y axis the growth rate of the business. The idea was to group a firm’s products, technologies, people, or whatever the BCG consultant needed to categorize as a cash cow (complete with a cow picture), stars, dogs, and problems or questions. The client could see what to “milk” and what to shut down. The BCG team would analyze further but the BCG matrix was a good business use of stuff that every calculus student learns in the second day of class. BCG, like other blue chip firms, crunches numbers until those numbers howl for mercy. The analysis sits underneath the matrix. The brilliance of the BCG approach is that it allowed BCG to explain a strategy without having to show slide after slide of analysis; for example:
- Dog–Low market share, low market growth. Example: Search utilities like Outside In
- Cash cows–High market shares, low market growth. Example: IBM OmniFind
- Stars-High market share, high market growth. Example: Google Search Appliance
- Problems or question marks–Low market share, high market growth.Microsoft Live.com search.
Others jumped on the bandwagon. I don’t recall the Booz, Allen & Hamilton buzzword for its strategic map. I have a copy around here somewhere. My recollection is that the McKinsey version of the BCG matrix was that McKinsey had six cells, not four. I always thought of the children created from the BCG quadrant as the BCG matrix. Sloppy thinking, I know. But BCG’s Bruce Henderson was identified to me as the “evil genius” who put Booz, Allen and other blue chip consulting firms behind the eight ball for a period in the 1970s.
When I started paying attention to search and retrieval, an uninformed senior executive whom I am loath to identify, gave me a copy of a Gartner report with a “magic quadrant.” I remember thinking that the Gartner approach did not make much use of the type of analysis cranked out by the blue chip firms. Remember that the MBAs and assorted whiz kids manipulated hard data such as sales by region, product margin, legal costs, research and development expenditures, and the like as the foundation on which the BCG matrix stood. Not the Gartner analysis. My recollection is vivid. The data seemed soft. I was thinking that whoever generated a soft matrix at Booz, Allen or one of the other blue chip firms where I have labored as a rental would have met with considerable push back.
Applying the BCG matrix to a business sector known for project failures, cost overruns, user dissatisfaction, and marketing baloney was likely to create some vendors with noses out of joint. The pure numerics of the BCG matrix focused on a single company or an industry sector and had data behind it. One’s nose could be out of joint, but the data are the data. Subjective analyses are just that, subjective and inherently impressionistic. Sales data are sales data. One can argue about how the data were collected, but the numbers are what they are.
Imagine my surprise when I read the Forbes.com article “Auto0nomy Positioned in Top Players Quadrant in Radicati Group Magic Quadrant” here. I have no quibble with Autonomy being listed as a leading vendor. What struck me was that the Radicati Group seemed to have borrowed heavily from the Gartner magic quadrant, itself a borrowing from the original BCG matrix.
My thought was, “I wonder if Radicati is hooked up with Gartner?” In my opinion, we have a mini-boomlet in azure chipped consultants recycling ideas. In my opinion, I think these derivatives of the original BCG matrix should:
- State the data on which the rankings or recommendations were based
- Provide hard data, not impressions
- Offer links to fungible data.
Perhaps Beyond Search should cook up a multi-celled, hypercube and populate it with rankings of the more than 300 vendors in the search and content processing space? Perhaps Beyond Search should ignore the market realities and plug in little known systems as vendors who are poised to trample the giants like Autonomy and Google? I don’t think this type of exercise is much more than a publicity and marketing play.
A similar situation is evident in Gartner’s use of the Burton Group’s notion of a “superplatform” recast as a “megavendor”. See here.
Edith Wharton, the American novelist, said as I recall, “True originality consists not in a new manner but in a new vision.” To revivify the flagging search and content processing sector, originality is needed. And quickly in my opinion.
Stephen Arnold, January 13, 2009
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