Aug. 4, 2021

Analysts Shape Markets

Analysts Shape Markets

Augmented reveals the stories behind the new era of industrial operations, where technology will restore the agility of frontline workers. 

In episode 35 of the podcast, the topic is: Industry Analysts Shape Markets. Our guest is Kim Knickle, Research Director, Verdantix.

In this conversation, we talk about The main role of industry analysts which is to identify and understand trends in their chosen sector. What is the role of analysts going forward? What will their function be? Who are the relevant suppliers at any given time?

Augmented is a podcast for leaders, hosted by futurist Trond Arne Undheim (@trondau), presented by Tulip.co, frontline operations platform, and associated with MFG.works, the manufacturing upskilling community launched at the World Economic Forum. Each episode dives deep into a contemporary topic of concern across the industry and airs at 9 am US Eastern Time every Wednesday. Augmented--the industry 4.0 podcast.

After listening to this episode, check out Verdantix as well as Kim Knickle's social media profile.

Trond's takeaway: Industry analysts are surprisingly relevant in today's information rich markets, perhaps because of information overload or the need for trusted sources of information. But as industry morphs and categories change faster than before, can firms keep up with the markets, and can analysts create a still picture of an evolving situation? Analysts are traditionally helpful for the buying process. Navigating the manufacturing industry is becoming more and more difficult as traditional vendors are complemented by a myriad of startups. As analysts assess trends, create segment taxonomies, size up markets, and prepare industry forecasts: 

Thanks for listening. If you liked the show, subscribe at Augmentedpodcast.co or in your preferred podcast player, and rate us with five stars. If you liked this episode, you might also like episode 42, Business Beyond Buzzwords, episode 32, Covering Industrial Innovation or episode 9, The Fourth Industrial Revolution post-COVID-19

Augmented--industrial conversations that matter.

Transcript

#36 Kim Knickle - Analysts Shape Markets

[00:00:00] Trond Arne Undheim, host: [00:00:00] Augmented reveals to stories behind a new era of industrial operations or technology will restore the agility of frontline workers. In episode 35 of the podcast, the topic is industry analysts, shape market. Our guest is Kim Knickle  research director at Verdantix.. In this conversation, we talk about the role of industry analysts, which is to identify and understand trends in their chosen sector.

[00:00:32] What is the role of that? Going forward, what will their function be? Who are the relevant suppliers at any given time? Augmented is a podcast for leaders hosted by futurists, Trond Arne Undheim, presented by Tulip.co the  frontline operations platform and associated with mfg.works. The manufacturing upskilling community launched at the world economic forum. Each episode dives deep [00:01:00] into a contemporary topic of concern across the industry and airs at 9:00 AM us Eastern time, every Wednesday. Augmented the industry 4.0  podcast. 

[00:01:13] Kim. How are you today? 

[00:01:14] Kim Knickle: [00:01:14] Good, thanks. How are you?

[00:01:16]Trond Arne Undheim, host: [00:01:16] I'm doing great. I thought we'd talk about the industry. 

[00:01:21] Kim Knickle: [00:01:21] It sounds like a good idea to me. It's one of my favorite topics. 

[00:01:24] Trond Arne Undheim, host: [00:01:24] Yeah. So Kim you studied engineering at Cornell, which I love it up there.

[00:01:29]And you also have an MBA, so I guess that's what makes an analyst. You're a combination of business and technology. And you've had a career as an industry analyst at various different firms, which is very handy for me. For this interview because we're going to talk about what this analyst function is it's a kind of a mysterious to non analysts actually. What, what brought you to the field? 

[00:01:51]Kim Knickle: [00:01:51] As you say for my background, you can see, I have a business and a technology background, and honestly it was reading the job descriptions and [00:02:00] it was everything I enjoyed doing.

[00:02:01] The first job that was definitely an industry analyst job. I was young enough that I went and applied in person. I carried my resume along with my six month old baby into their office and dropped it off. Just to check and make sure that this was a real thing. And it's everything I love to do.

[00:02:25]It's taking in lots of information, staying on top of new technologies helping people. It's just a combination of everything I enjoy. 

[00:02:35]Trond Arne Undheim, host: [00:02:35] And throughout your career, you have focused on a bunch of different technologies. Mostly guests relevant to manufacturing and retail. Cloud or the whole issue of cloud platforms, but including fascinating things like AI, augmented reality, virtual reality, even computer vision stuff, and IOT, and then into some blockchain stuff.

[00:02:58] W what are some of the things that have [00:03:00] fascinated you the most in, in this work. 

[00:03:03] Kim Knickle: [00:03:03] Most of what I enjoy are looking at technologies, researching technologies, researching how technologies are being used are more of the things that are new. And that's been important to my career because if you look at the way, even the analyst industry has evolved, it used to be that we all really struggled to get information about new technologies, and now we get too much. And so I get to be a person who collects the information that's hard to find, but then also applies a practical lens to something that's often getting hyped in the market and.

[00:03:44]So really my specialty is in newer areas of technology, newer business processes, newer approaches. I'd say, 

[00:03:54] Trond Arne Undheim, host: [00:03:54] I could just imagine as an analyst, that it is. It is your job of course, to stay up to [00:04:00] date. But like you said, if there's not a lack of information, rather the opposite, and I'm assuming in your business you have to subscribe to the work.

[00:04:09] So you get both the formal kind of industry reports of your competitors and others. And then you have to find some proprietary sources of insight or you have to combine it in ways that makes it interesting. Give me a little sense of what a Workday looks like for an analyst. 

[00:04:28] Kim Knickle: [00:04:28] So you'll have a lot of different stakeholders.

[00:04:30] And so those stakeholders consume your energy, your knowledge, your day. And so it's a combination of working with what I'll simply call it buyers, but that includes people who influence the buying process of technology. They may be in the it organization. They may not be so it's poor part of the day, that's speaking to those it buyers.

[00:04:54]Some part of it is talking to the it suppliers. So that's a pretty [00:05:00] broad category to, those could be services, software, hardware, you name it. And then there's also the financial analyst community and the press. And so the press is probably a really small percent, maybe 5% financial analysts or for most of the firms I've worked for it's, less than 10%.

[00:05:19] It's really I'd say another, quarter of the time is with the With both the buyers and the suppliers. And then there's always, you need the time to really absorb the information, organize it, and put it into a format where it can be shared back out. So that could be a PowerPoint presentation, but it could also be a literally a PDF, a word doc. And my preference is that it has lots of graphs and headings and subheadings and bullets but basically a written format or a presentation style format. And as well as, more Excel type of forecast data kind of data intensive prod products.

[00:05:59]Trond Arne Undheim, host: [00:05:59] I'm still [00:06:00] struck though, by what you're saying about the amount of human interaction and human data gathering and interviews compared to the more cold kind of analytics focus. Because when you read your reports are not yours specifically, but the ones coming from the analyst community, it seems like every other PowerPoint does have statistics associated with it. So surely a lot of it has to do with gathering those numbers, but you're still, it's the conversations that, that you were focusing on now. 

[00:06:30] Kim Knickle: [00:06:30] Yeah. Most analyst firms have a large service that they run, which means that There are often specialists in the survey development and the initial survey analysis.

[00:06:44]Not to say that there isn't for most analysts but that is something that you then can reuse in multiple ways. And so that's why I don't put the survey part. Data, the actual, statistics type part as a big part of a typical [00:07:00] analyst day. It certainly using that information and understanding the impact of that information.

[00:07:06] And, the, so what you know about that data but it's not actually going out and serving people is not a part of every day. 

[00:07:17] Trond Arne Undheim, host: [00:07:17] No, I get 

[00:07:17] that, and I think that's very important to point out because it's the context around the data that is the special sauce. Like clearly you have to have the data first, you have to have and choose the right data and frame it the right way.

[00:07:28] But it is exactly it's the contextualization that you spend a lot of time with. 

[00:07:35] Kim Knickle: [00:07:35] Just, I just want to say something about surveys. One of the important things when I advise people like how to use publicly available data, you should always be really careful about the source and also how people interpret it.

[00:07:49] And that's true for technology as well. Pretty much anything in life, you make sure you understand, how big was the survey? Who did they actually survey? [00:08:00] Sometimes the way the questions are asked, they lead the respondent so much that the data really isn't worth a whole heck of a lot.

[00:08:08]So I always advise people to be cautious about the source of the data. When, whenever they read that data point. 

[00:08:18]Trond Arne Undheim, host: [00:08:18] And Kim, 

[00:08:18] is that getting any better? It's not like statistical analysis or awareness of manipulation of data is any, is a new topic, but is the industry as a whole getting better or are there just more sources?

[00:08:31] So there's just more sources of bad data as well. And it's like tempting sometimes to throw in the newest, because it has seemingly the right kind of angle to it. But like you said, it wasn't perhaps carried out the right way. 

[00:08:45] Kim Knickle: [00:08:45] I would like to hope that the survey data collection process is getting better.

[00:08:51]I still it's like anything people think that anybody can do a survey. Anybody can write a survey, anybody can analyze the data and I would [00:09:00] say, no, that is not true. 

[00:09:03] Trond Arne Undheim, host: [00:09:03] Yeah. I have looked at that space quite a bit and I've spent a lot of time trying to create surveys and it's and being graded on it as well and graded others.

[00:09:12]It's not easy stuff. It's actually, there's a trade, it's a trade involved trade skills. Yeah. As an analyst, you not only gather data and shape it, and put it into written form. You also, to some extent, shape a market, that's what you do. Can you tell me a little bit about that sort of market creation process?

[00:09:33] So in, in your field like Manufacturing, w how would you say a market gets formed with, or a sector gets formed within manufacturing? And what extent to what extent does an analyst play a role? 

[00:09:45] Kim Knickle: [00:09:45] Yeah. The, an analyst is supposed to be an independent party, right? So an analyst doesn't work for the buyer and analyst doesn't work for the supplier.

[00:09:56] And an analyst is supposed to represent an independent source [00:10:00] who can gather information multiple companies and and draw conclusions. So the idea is that when an analyst sees a common need and a common approach to solving that need he, or she should be a, to finding a market, and this is actually something that takes some time. So if we. If I look at some common categories like ERP and we were talking about MES, for example ERP, I believe the term Gartner takes credit for and MES AMR research where I used to work takes credit for that term. And the idea is that the people who were at Gardner and AMR at the time of the development of those markets saw that there was a business problem that needed to be solved.

[00:10:53] And they saw a two or more vendors IT suppliers creating an application to solve those [00:11:00] problems. The whole reason for creating a market though, is ultimately because when companies buy technology they want to be able to create a short list. They don't usually want to just go to one single company and say, I have this problem and can you solve it?

[00:11:18] They want to be able to say, here is the functionality I need. Here is here's the way I've seen other companies solve this problem. What will it take for me to be successful using that technology and the creation of a market speeds, the process. There are there have been times in the past where analysts or analysts firms have tried to create markets and it just hasn't, a term hasn't caught on or what they thought was going to be a market ended up getting absorbed by another market.

[00:11:53]So it, it's not there are plenty of it suppliers who have tried to create a market, [00:12:00] but again, it's very hard for a supplier to take that kind of independent approach and say, this is a market and there's nobody else in it. It just it frustrates the market in that they're they want to build a market so that the, it buyers want to see a market created so that it simplifies their process of acquiring that technology successfully.

[00:12:24] Trond Arne Undheim, host: [00:12:24] That's interesting. Maybe you can clarify this for me. It's always a little confusing when you're analyzing markets, so there's this term category that comes from retail, which is a very defined thing within a market. And then you have sort of sectors that is somewhat wider and then you have markets and you, we're now talking about defining a market.

[00:12:45] What do all these things mean? Do they mean you actually are able to identify buyers and sellers in a very distinct type of product, or is it not as clear as that? So when you say creating a [00:13:00] market or people say let's create a category or here's this category, does it really imply. There's a very distinct group selling this and only this, it would seem to me like these are sort of old school terms from a time when things were much more fixed and set in stone than things are these days.

[00:13:17] But the business models in SaaS  and things like that, they evolve and they take on different form. 

[00:13:25] Kim Knickle: [00:13:25] Yeah, I think that's a great point. When the ERP and MES markets were created, it was really fairly well-defined application. And so I don't want to call it monolithic. That's the wrong term, but I think the way that companies are acquiring or building software has really changed.

[00:13:48]We don't see as often that people are going out and buying, If you look at some of the to explain this a little better, if you look at some of the historic ERP [00:14:00] investments, and I'm going to use that because it's a very big category, they were multi-million dollar deals and most companies especially in the manufacturing industry can't afford that because there are a lot of small and medium-sized manufacturers. Plus the way that applications are developed has evolved quite a bit. And the code that's used the tools that are used. And so they're more smaller applications, more applications solving a smaller business challenge.

[00:14:34] And is it right to create all of these kind of micro markets or micro categories? I'm not sure what the right answer is, but I think we've because of the way that technology is con is built and consumed. We may not need to have such kind of large markets or large categories. Now I'm going to say I don't fret too much [00:15:00] about the difference between category and market and sector, but you're right in the retail industry, they are very precise on what those mean, but in the technology space, I'm not so sure.

[00:15:10]So I think that answers your question.

[00:15:12]Trond Arne Undheim, host: [00:15:12] Yeah, no, 

[00:15:12] it does. But so ERP is one thing that's obviously a massive space if you look at manufacturing execution systems or MES, which you said, AMR takes, takes the credit for when was that term for created and who were in the space then, and where is this?

[00:15:31]Can you explain a little bit about this category? It's an immensely interesting category that's now arguably at the heart of kind of a new wave of change. So it's a pretty interesting category to think about. 

[00:15:43] Kim Knickle: [00:15:43] Yeah, I'm not sure I know all the details. You'd have to get some of my old AMR colleagues on, or someone who spends a lot of time in this, in the MES market to go into the details.

[00:15:54] But I'll give you the high level as I, I remember them. So ERP, I keep coming back to ERP because [00:16:00] it was one of the first, really large categories of software. And if if you know what an ERP stands for the P being planning the idea of the manufacturing execution was to be the compliment to the planning side, the actual execution piece.

[00:16:16] And there were

[00:16:18]I'm going to get myself in trouble. If I try to guess who the vendors were at the time the it vendors were 

[00:16:23] at the time,

[00:16:25]Trond Arne Undheim, host: [00:16:25] I'm just curious, like generally w were you, so you would say that the category evolved. The broader ERP space as now we really are seeing that the execution is becoming more, a prominent element 

[00:16:38] Kim Knickle: [00:16:38] and something that could be done through a almost off the shelf application.

[00:16:44] So as opposed to a fully custom application so yes, it was the compliment and it was something that based on the The companies that were in the market. And a lot of them were the ERP type of companies that were expanding into MES, but they were also specialty [00:17:00] ones. And the way the MES market has evolved is there's been, there has been this kind of synergy between ERP and MES for a long time.

[00:17:11] And if you also look at what some of the No players in this market today they are sometimes described as ERP and sometimes described as MES. So it's it seems to be a fluid category that nobody draws a hard box around. At least I don't, I should say. 

[00:17:32] Trond Arne Undheim, host: [00:17:32] It is it's interesting what you said that it moved from execute from planning to execution.

[00:17:37] I'm just wondering so there, there are some other terms that I'm aware of. So system of record versus system of engagement, I guess one of the newer issues, and which is why I wanted to talk about the MES category is that even within MES, there is an increased focus now on the end point, or actually I should say, on the whole chain.

[00:17:57] So that's the one, right? Not just talking [00:18:00] about the planning, but the actual execution, both early stage in the product development and end to end, with the supply chain. But anyways, a lot of these very heavy systems that have everything they're called system of record because that's where you track everything.

[00:18:14] And that's where all the financials go into and all the numbers that eventually make it into, annual reports and whatnot. But it's certainly also tracking of the products as a process, but systems of engagement. Would tend to be, as an emerging category of systems that could be related to this, but they are not necessarily the system of record, meaning that they are where you execute a lot of things or maybe where the worker's gained some sort of productivity, but it could be more that they're lighter systems and maybe they don't have kind of the stability of these original systems.

[00:18:52]But how do you see this? Is this now still to be understood for you as a, as an [00:19:00] execution system, or, how are we to understand these new software platforms that are starting to emerge in this overall space that are not, definitely not monolithic because they don't carry out.

[00:19:11] The sum total of everything that the initial systems did, but they are on the other hand, somewhat more nimble. So how do you, how are we to understand these systems within the, within this nomenclature?

[00:19:27] Kim Knickle: [00:19:27] Wow. That's a big question. So one thing I would say is that the term system of engagement to distinguish it from a system of record, I'm totally in agreement with that. I've historically seen the term system of engagement used for more of the customer facing type of applications and not necessarily in the plant.

[00:19:51] And so that's absolutely something that may evolve because your employees are in need [00:20:00] of applications that are not necessarily system of record. So I, I would be okay with looking at this as something that absolutely needs to engage with employees. I'm not gonna, I'm not going to draw any box around that term, but I think that what's important for the execution systems to do is to support the everyday requirements of the worker. And one of the things we used to talk about at one of my past analysts firms was recognizing that there's a difference between the strategic and the tactical. That's one of the factors and you can even so strategic being more long-term type of requirements.

[00:20:39]And the tactical being all the way down to the decisions you need to make in the moment. And I think that's important for an execution system to be able to do is to help support those decisions that need to be made in the moment. And we don't have to be moment, meaning microsecond or second, it could [00:21:00] be, in this hour, in this specific shift, what decisions do I need to make right now?

[00:21:06]And to hit my production numbers to serve the produce for the orders that I have today and make the right product at the right time. 

[00:21:15]Trond Arne Undheim, host: [00:21:15] If we go back to this cloud term that has come in and out of your career what would you say is the situation now in the manufacturing industry is, are most systems and thereby also most plants moving to the cloud now and how's that shift occurred. It's an interesting question. For people outside of manufacturing, it would seem so obvious because cloud has been such a big part of the debate for the last, decade. But it's not super obvious in manufacturing. Where are we with cloud generally?

[00:21:45] Kim Knickle: [00:21:45] Yeah. So my research into cloud and the adoption of cloud computing for manufacturers probably goes back a good 10 years and  I always surprised people and I told them that [00:22:00] manufacturers were among the earliest adopters of cloud computing. And when we would do the surveys at IDC, we would see pretty great numbers for how many companies were actually using cloud and how many were planning to adopt cloud.

[00:22:15] But, those numbers needed to be qualified when we talked about them because the profile of the manufacturers that you have a corporate headquarters and you have many plants and you have really lean it teams at those plants, usually, especially with the smaller and mid-sized manufacturers and A lot of those, a lot of the manufacturers also with the speed at which they needed to acquire and divest of plants and businesses.

[00:22:45] And so on a lot of those manufacturers look to the cloud for the kind of basic applications, emailing calendaring all of the I'm going to, I might get myself in trouble here at what I think of as commodity [00:23:00] applications. And they, I think that they bought into it to those types of apps to simplify the way they worked.

[00:23:08] And then they they stayed on premise for what was actually running the plant and sometimes the supply chain, but because of the way that they needed to collaborate with other companies, they were willing to put some supply chain functionality into the cloud fairly early. So the. I am definitely seeing more investment and more willingness to put the core applique plant based applications into the cloud.

[00:23:39] And there are a lot of companies that are really making that possible there are a lot more technologies, making that possible around the actual networks in and out of the plant. I'm not sure that numbers are really they're not where I thought they would be today. However, there's still a lot of [00:24:00] confidence in the growing use of cloud-based applications in the plant. And you can just look at the recent headlines. Here we are looking at two recent acquisitions of of. Major suppliers in this market QAD and plaques.

[00:24:17] And that to me just says that there's a confidence in the use of cloud-based applications. Now, QA, D and Plex are obviously different approaches to, to these and but a sale. I think it's a sign that there's still investment in these apps and there's a growing reliance on the cloud. 

[00:24:37] Trond Arne Undheim, host: [00:24:37] I've understood that.

[00:24:39] There is really quite a big distinction, even among large players, large manufacturers among their different sites. And, if you have a large multinational, they will tend to have some flagship sites that they have invested in that may be larger tech. They may maybe skewed larger because it's, easier to defend okay, we're going to spend some money on these.

[00:25:00] [00:25:00] And they would tend to be they could be perhaps part of some large sort of on-prem deployments, but either way they have worked on these sites and they have invested and they have a certain amount of efficiencies there. But it's quite another challenge. The fact that a lot of large companies also rely on smaller sites because that's just the way of the nature of their business is they have a, a bunch of disparate, smaller sites that also carry out pretty crucial functions.

[00:25:27]In your time as an analyst, when you were, when you're advising clients, how do you account for that? The sort of the non monolithic character of their business. Manufacturing would seem to just, it's not one thing. It is so many different functions and like I said, these sites vary so much.

[00:25:45] How do you account for that in a strategy, in an it strategy? 

[00:25:50] Kim Knickle: [00:25:50] Really important, what you just said, which is that manufacturing is not one thing. Or you look at every single product and even, manufacturers who make the [00:26:00] same product and they make them differently. And maybe the production line processes almost exactly the same, but the suppliers the, just the massive number of decisions in order to make a product mean that the plant managers and the local it folks want to be able to decide what works best for them. What's important is that they support that system of record type of requirement, not how they make their daily decisions in the plant.

[00:26:35]That they support the companies, requirements for orders and the strategy for growth and so on, not exactly how a product is made, that they meet specific quality requirements. Of course, all of those things are our company decisions, strategic decisions and  as an analyst, we often saw that there would be one application that was the [00:27:00] system of record in the company. And then there would be a different vendor supplying plant a and a different vendor supplying plant B, not just because they were making different products, but because they served a different customer or they had to hit a different.

[00:27:19] I don't know different targets or what have you. So that is that is why we spend so much time talking about standards in terms of data sharing and the important of being able to roll data up the importance of being able to roll data up and analyze data. In a at a local site as well as across the company.

[00:27:42] And so a lot of this is about, is really about making sure that you can meet the company's information management, data management analysis requirements local and national regulations. All of that stuff comes into [00:28:00] play. And so it's not so much. The company doesn't have to say, we standardized on this MAs system, it's just isn't necessary.

[00:28:10]And that's to me, that's a good thing. And so that's why one of the evolutions that we're seeing in manufacturing is what kind of governance needs to be in effect where, how do we allow. We haven't even started talking about it and OT integration, and that's ultimately what has to be considered is how do you make the OT meaning operational technology.

[00:28:37] And it, of course the information technology, how do you make those decisions go hand in hand? 

[00:28:42] Trond Arne Undheim, host: [00:28:42] Tell me more about that. Cause it's, it would seem to be an interesting issue. Definitely in, in manufacturing because operations is at the heart of it. W why would you say there even is a conflict in the first place?

[00:28:54] Why are there, is it the systems that are different or is it the people that are the, 

[00:29:00] [00:29:00] Kim Knickle: [00:29:00] I think that's a leading question there. Yeah. It's both, of course. And it's, you have to look at the history to understand The conflict, but I think a lot of that's being bridged. So part of it is that OT, operational technology was designed to serve the plant.

[00:29:19] And often there were engineers, manufacturing, engineers who made those decisions. And of course we know that OT has added more and more IT. It, into the system and how we manage a system and it, has evolved from a computer scientist, a developer kind of mindset. And they, I, I come from an engineering background and I work in the it industry and I still see that conflict. And some of it's the type of people who were attracted to each of those disciplines, but I think that's really [00:30:00] changing. And I hate to say, it's the younger generation who's helping us change it, but it's anybody who's really forward thinking who recognizes the way that, that technology, whether it's the I or the old technology is evolving and really getting better.

[00:30:15]But yeah, engineers and computer scientists are a historically very different people. 

[00:30:21] Trond Arne Undheim, host: [00:30:21] It is a mystery almost, how they were all bucketed  one group I E engineers and even taught in the same schools, even though now, like in retrospect, that was a smart move because this is the real, this is the issue, right?

[00:30:34] Because if the two groups continue to move apart that, that would seem to be an issue. But there is an educational an experiential journey on both sides, right? Because I Have seen, young software engineers don't necessarily have all the intricacies of operational plant in mind when they try to come up with creative solutions and code bases that you know, are going to solve quick [00:31:00] fix to a problem. It like some bright solution that doesn't necessarily always work either. So there, there's, it's not like the young hip crowd has all the solutions, right? There's some engineering and unexperienced from the plan side that I've talked a little bit about that.

[00:31:15] Kim Knickle: [00:31:15] Yeah. So I, in my career, so I went to an Ivy league school, the best of the best kind of engineering school with lots of great research But really let's face it. It was super theoretical. And my first job out of college was at underwriters labs where I, my, my cheeky description of it is I went to work to break things, which we did a lot more.

[00:31:43] It was about product quality and compliance. And, I had to take apart. I had to take apart products. I had to take apart motors. I had to look at how the circuitry was done. And it was very practical and hands-on, and it wasn't, there was [00:32:00] a learning curve and I think that's true for, any background, if someone's education is very practical, whether it's in school or, in a job, if it's very practical, Connecting with the people who are very theoretical.

[00:32:16] It just takes some time. But I, that's why companies need to define goals and objectives. That's why we say our objective here is to make a happy customer. Our objective is to, is the perfect order. That's how you make these people come together. You see how they help each other and create a more successful company in a more successful product.

[00:32:44] Trond Arne Undheim, host: [00:32:44] I want to move to thinking a little bit more about the next few years and how things might evolve. And I want to first maybe just think about the fact that historically there have been three plus analysts firms that have managed [00:33:00] to, or maybe more in this space, but they've managed to create these concepts, not just coined terms.

[00:33:05] So we would just been, been around that, but you mentioned previously gardeners, so Gartner's magic quadrant, has become a big item. IDC has the market scape, and maybe all their terms, Forrester has their wave. What is the role do you think going forward of these large analyst firms versus other breakout firms in terms of are they going to still be able to have these overarching terms that's that matter and really shape markets where you have to be included?

[00:33:37] Or is it, are we moving towards a decade where there are going to be to your point more sources of information and, the. The user of this information, whether you are an industry or, on the market side investing in, in, in this space, how are you going to be able to navigate this?

[00:33:55] If maybe this again is a leading question, but I'm going to pause it posit that, IDC, Gartner [00:34:00] and Forrester are the, are big ones, but they're not the only ones and the marketplace, even of analysts is wider. What is it? Yeah. So one, do you agree to that? And then what does that do to our understanding of these markets?

[00:34:16] Kim Knickle: [00:34:16] Yeah If you had asked me in 1995, I was really trying to figure out how the and the major analyst firms could survive. Given that all so much information was now being made available for free on the web. It was just, all you had to do was search and internet search and you could get all this information.

[00:34:39] And have come to realize that there is a major trust and credibility factor. One of the things I say is that, yes, I think those large analysts firms are going to continue to be successful because most analysts are not really good marketers. They're analysts, [00:35:00] they're cheerleaders in curmudgeons.

[00:35:01] They're not always, they're not there they're not always Interested or willing to do all of the things that make a business successful. And so the whole infrastructure that wraps around the analyst within these large firms exists for a reason. However, I describe analysts as you should find an analyst to work with, and this goes for both it buyers and it suppliers, you should find an analyst to work with that you trust and will be honest with you when in terms of what they really know and what they don't know, and also be willing to share an opinion about what they know. And so to me, I described, I've described analysts as it's like picking the right yoga instructor,

[00:35:57] picking the right personal [00:36:00] trainer or coach at it has to be someone that you. Really liked their style and you trust them. And I am because of that importance of the personal relationship, I think there are going to be plenty of independent analysts and plenty of boutique analyst firms.

[00:36:22]And in fact, I am, I'm hoping to work for one of those boutique analysts firms in the future. And I I also advise people if you want to get a little bit of a sense of an analyst. Go to their company website, look at their LinkedIn posts. See if they post anything on Twitter. You can get a sense of an analyst based on some public information. 

[00:36:47] Trond Arne Undheim, host: [00:36:47] W where are we headed in the next decade? Now I'm asking you as an analyst. So we're, we've talked about around the industry and the profession of okay. Of an analyst and what might go into that. Now I [00:37:00] wanted to challenge you more so many industry developments that you are either excited about or that where you see that some technology trends are coming to a four. What do you see emerging in the manufacturing space right now? It's a broad. 

[00:37:15] Kim Knickle: [00:37:15] Yeah. So I am. I'm pretty excited about the way that we're starting to see artificial intelligence really used. And it's not, I'm not talking about replacing humans. I'm talking about something that you talked about in an earlier podcast about augmentation and some automation. And I  really interested in and seeing that develop. I think that there are lots of day in and day out decisions that could be supported with AI as well as some automation.

[00:37:48] And then, some of the coolest stuff I've seen over the. Year or so has been in that immersive experience the augmented reality and the virtual reality. One of the things, [00:38:00] we talk about in the manufacturing industry is the shortage of workers. There is nothing like showing someone how cool manufacturing is with with a headset or with augmented or virtual reality. There is nothing more cool than showing someone how they can actually do a job by using augmented reality to walk them through something and give them that confidence. I just I think that it inspires more people to to learn about manufacturing and to really be willing to join the industry.

[00:38:40] And I hope that more manufacturers see that's part of what we need to do is to demonstrate that technology will help us attract that next generation of workers. 

[00:38:55] Trond Arne Undheim, host: [00:38:55] Yeah. It's interesting. I try to ask everyone who comes on this [00:39:00] podcast. It's an impossible question because everyone who is on this podcast is already predisposed to being excited about these things.

[00:39:08] But I always wonder why isn't everyone else excited? 

[00:39:12]Kim Knickle: [00:39:12] In most high schools, they don't have access. To all of this technology. And we I think we are seeing a resurgence in what we used to call vo-tech schools, vocational technology. I don't think that term is always used. But the, The wood shop of the past is now the technology shop in a lot of high schools.

[00:39:35] And I think it's just exposure. I personally when I work with kids or when I talk to kids I try to talk about how interesting manufacturing is. I think we have to be be careful in that we start to market manufacturing in a different way and we have to start when kids are in middle [00:40:00] school and junior high school and supported all the way through high school, 

[00:40:06] Trond Arne Undheim, host: [00:40:06] this is maybe not a question where you have the full answer, but can we.

[00:40:12]There's a lot of excitement to be had, but can we make a promise that holds water in the long-term because I think the ultimate answer to why people aren't excited is that they are students of history. They are students of their parents who lost their jobs. They are students of just reading newspapers about factory closings.

[00:40:31]To what extent can we actually confidently as an  give people the sense that when you walk into a woodshop or, like a shop floor classroom in, in high school, and you are excited about a practical craft, not only will the teaching of that craft, be augmented and very interesting.

[00:40:51] And there's this hybrid and I've always worked with my hands, so I can relate to this. Can we really confidently make the prediction [00:41:00] that for most people going in this direction, as long as you are open to learning, of course, these advanced tools, because if not, you will, of course be sidelined as someone who doesn't embrace these tools.

[00:41:12] But if you do embrace these tools, Is there a path for most people because we're not talking here about the, just the top 10% of something. What we would have to say is generally this is a great industry to go into and there will be good jobs going forward. Could you, would you confidently be able to make that predict.

[00:41:34] Kim Knickle: [00:41:34] Wow. Put me on the spot there. So I think, we I'm that cheerleader on camera dune, right? So the curmudgeon in me says as much as we look at manufacturing as the industry has done well in terms of the percentage of GDP that it contributes to, but let's face it. The number of jobs has decreased significantly because you don't need as many people. [00:42:00] To actually produce something as you did, 50 years ago. I want to remind people that manufacturing is not just what happens in a factory of 150 people. That manufacturing is just as important to creativity and design as it is to the actual production piece.

[00:42:20] And what I mean by that is the thinking of designing and production should go hand in hand. So anybody who thinks they're an entrepreneur, anybody who thinks they're a designer or a creator, they should be recognizing that they also need to be involved in the manufacturing process. And one of  I recently joined a nonprofit board who's been focused on the arts in a small town in Southern Maine historically textile town. And they obviously have gone through a lot of changes in, and what they like to show is [00:43:00] that there's a connection between creativity and commerce. You don't get to commerce unless there's some production piece.

[00:43:06] And so I really want to Make sure that anybody like they don't have to think I want to be in manufacturing. All they have to do is one of to say, I want to be an entrepreneur and I want to design things. Then you need to also be part of the manufacturing industry. I just want that connection to be more seamless.

[00:43:26] Trond Arne Undheim, host: [00:43:26] I think that's an excellent point. I think. If everyone who said that they want to be an entrepreneur, had a little bit less coffee. And, it was sitting in various co-working spaces thinking up, dreamy, digital ideas. And instead started working on something and started manufacturing and testing out something physical and integrated with the digital aspect much earlier and realize the complexities of creating a hybrid product that, that actually has to be manufactured and crafted. [00:44:00] We would be in a different place. And I agree that's seems like a very interesting proposition. Thanks so much. Kim, look, I I feel more informed on what an analyst does and I feel more optimistic, I think, on your own industry's contribution.

[00:44:16] I think it is a bit of a mystical profession. It's it is a, you are amusing from the mountains, but now I feel like I have a sense of where you're staying. 

[00:44:26]Kim Knickle: [00:44:26] Thank you for letting me a little bit about my profession and I'm always happy to explain it, but I do often explain it.

[00:44:35] So you're not the only one asking some questions. 

[00:44:38]Trond Arne Undheim, host: [00:44:38] Thanks. Thanks a lot. I hope I can have you back someday. And have you comment on what has happened since last time. Thanks so much, Kim.

[00:44:47] You have just listened to episode 35 of the Augmented podcast with host Trond Arne Undheim.The topic was industry analysts, shape markets. My guest was Kim [00:45:00] Knickleresearch director at Verdantix. In this conversation, we talked about the role of industry analysts now and in the future. My takeaway is that industry analysts are surprisingly relevant in today's information, rich market. Perhaps because of information overload or the need for trusted sources of information, but as industry morphs and categories change faster than before, can firms keep up with the markets and can analysts create a still picture of an evolving situation? Analysts are traditionally helpful for the buying process.

[00:45:38] Navigating the manufacturing industry is becoming more and more difficult. As traditional vendors are complimented by a myriad of startups as analysts assess trends, create segment cactus, enemies, size of markets and prepared industry forecasts. What is the future? Thanks for [00:46:00] listening. If you liked them subscribe at Augmented podcast.co or in your preferred podcast player and rate us with five stars. If you liked this episode, you might also like episode 42 business beyond buzzwords episode 32 covering industrial innovation or episode nine, the fourth industrial revolution postcard COVID-19 Augmented industrial conversations that matter.

 

Kim Knickle

Kim Knickle, Research Director, Verdantix