Gideon Gartner
Encyclopedia
Gideon I. Gartner is an entrepreneur
Entrepreneur
An entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative.The term was originally a loanword from French and was first defined by the Irish-French economist Richard Cantillon. Entrepreneur in English is a term applied to a person who is willing to...

 and philanthropist
Philanthropist
A philanthropist is someone who engages in philanthropy; that is, someone who donates his or her time, money, and/or reputation to charitable causes...

, best known as the founder of Gartner
Gartner
Gartner, Inc. is an information technology research and advisory firm headquartered in Stamford, Connecticut, United States. It was known as GartnerGroup until 2001....

, an information technology
Information technology
Information technology is the acquisition, processing, storage and dissemination of vocal, pictorial, textual and numerical information by a microelectronics-based combination of computing and telecommunications...

 (IT) research and advisory company.

Early life

Gartner was born in Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...

 and grew up in New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...

. He attended the Massachusetts Institute of Technology
Massachusetts Institute of Technology
The Massachusetts Institute of Technology is a private research university located in Cambridge, Massachusetts. MIT has five schools and one college, containing a total of 32 academic departments, with a strong emphasis on scientific and technological education and research.Founded in 1861 in...

 (MIT), obtaining a BSME in 1956 and a Master's degree
Master's degree
A master's is an academic degree granted to individuals who have undergone study demonstrating a mastery or high-order overview of a specific field of study or area of professional practice...

 from the MIT Sloan School of Management
MIT Sloan School of Management
The MIT Sloan School of Management is the business school of the Massachusetts Institute of Technology, in Cambridge, Massachusetts....

 in 1960.

Early career

Gartner began his career in the computer business. At IBM
IBM
International Business Machines Corporation or IBM is an American multinational technology and consulting corporation headquartered in Armonk, New York, United States. IBM manufactures and sells computer hardware and software, and it offers infrastructure, hosting and consulting services in areas...

, he was Manager of Market Information in its Data Processing
Data Processor
In information processing,a Data Processing System is a system which processes data which has been captured and encoded in a format recognizable by the data processing system or has been created and stored by another unit of an information processing system.A data entry is a specialized component...

 Division, and Systems Engineering
Systems engineering
Systems engineering is an interdisciplinary field of engineering that focuses on how complex engineering projects should be designed and managed over the life cycle of the project. Issues such as logistics, the coordination of different teams, and automatic control of machinery become more...

 Manager and Systems Engineer in IBM World Trade Corporation. He also worked for Philco Corporation in its Computer Division, and for System Development Corporation
System Development Corporation
System Development Corporation , based in Santa Monica, California, was considered the world's first computer software company.SDC started in 1955 as the systems engineering group for the SAGE air defense ground system at the RAND Corporation...

, working on two U.S. government large system contracts: SACCS (Strategic Air Command and Control System), and DCA (Defense Communication Agency Control System).

IT industry information businesses

In the years leading up to the formation of Gartner Group, Mr. Gartner was a partner at Oppenheimer & Co. He was voted the top individual technology analyst on Wall Street between the years 1972 and 1977 inclusive, in the annual poll of major banks, funds and other institutional investing firms, published by Institutional Investor
Institutional investor
Institutional investors are organizations which pool large sums of money and invest those sums in securities, real property and other investment assets...

Magazine.

Gartner Group

He founded Gartner Group (now called Gartner, Inc.) in 1979, and served as its CEO and Chairman through April 1991.

IT "Advisory" firms are distinct from consultancies, in that they provide "continuous" advice to clients - defined in renewable (but open-ended) contracts which typically include a mix of "deliverables" including (but not limited to) content; client interaction with analysts and/or experts; and events.

In 1979 the primary "advisory" firms in Information Technology (IT) were IDC
IDC
-Businesses and organizations:* Industrial Development Corporation, also known as Castle Grande, an Arkansas company involved in the Whitewater political controversy* Interactive Data Corporation , a financial services company...

 (International Data Corporation, part of IDG
IDG
International Data Group is a technology media, research, event management, and venture capital organization.IDG evolved from International Data Corporation which was formed in 1964 in Newtonville, Massachusetts, by Patrick Joseph McGovern and a friend, Fred Kirch...

), Dataquest
Dataquest
Dataquest is India's oldest IT publication. A fortnightly, Dataquest is published by Cyber Media India Ltd, South Asia's largest specialty media group. The magazine targets senior IT managers in user organizations as well as the IT industry professionals in India.Dataquest has grown with the Indian...

 (now part of Gartner), and Yankee Group
Yankee Group
Yankee Group, a Massachusetts company, sells advice and market-research information relating to information technology.-History:Founded in 1970, the Yankee Group emerged as the first independent technology research and consulting firm...

. Gartner's innovations, which were aimed at creating an advisory model which would address the evolving and complex needs of IT professionals and firms, included:
  1. Selling to multiple constituencies
  2. Financing
  3. Nationwide sales organization
  4. Sales measurement and compensation model
  5. Peer-level advisors
  6. Broad focus
  7. Research process and organizational culture

Selling to multiple constituencies

At the time, other advisory firms usually sold to only computer hardware, software and services vendors. Exceptions at that time included Dataquest (selling a service for investors), and Input Corp. (selling a service for users). Gartner sold to vendors, plus users (generally large enterprises and other organizations, such as government agencies), plus investors and consulting firms.

Investors were among the first targets, as Gartner had just resigned as partner of Oppenheimer & Co., but at Oppenheimer he had also begun servicing a group of Chief Information Officers (CIOs) of large corporations, which became the base for Gartner's enterprise activities. As Gartner Group's coverage of IBM was deep (IBM was the primary industry vendor at the time), other vendors desired to be tied into Gartner’s research network. Thus, the market Gartner addressed was unusually broad, and each constituency provided insights and information which benefitted others, arguably creating market advantage.

Financing

Gartner's venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...

 financing was unique among advisory firms at the time. Gartner Group was initially financed by Bessemer Venture Partners
Bessemer Venture Partners
Bessemer Venture Partners is a private venture capital firm with offices in Silicon Valley, New York, Massachusetts, Israel, China, and India.Bessemer Venture Partners is the longest-standing venture capital practice in the United States...

 and E.M. Warburg Pincus
Warburg Pincus
Warburg Pincus, LLC is an American private equity firm with offices in the United States, Europe, Brazil and Asia. It has been a private equity investor since 1966...

, with Bank Paribas joining a year later. This led to the firm being the first in its field to raise public capital in a 1986 offering, supporting its growth.

Nationwide sales organization

Raising capital from venture firms allowed Gartner to build a nationwide sales organization, the first of its kind in the industry.

Sales measurement and compensation model

Gartner instituted a sales measurement and compensation scheme, based upon how IBM had measured its rental sales, but novel when applied to consulting/advisory firms: since Gartner Group sold annual renewable contracts and recorded "Contract Value" , it based progress reporting and compensation (commission for sales personnel and bonus for analysts and managers), on the growth of appropriate Contract Value (CV) during a period of time; this was called Net Contract Value Increase (NCVI). Uniquely, compared with all prior consulting and advisory models, all variable compensation was based upon growth and not on revenue from renewals, an important factor in developing a strong growth culture.

Peer-level advisors

Having come from Wall Street
Wall Street
Wall Street refers to the financial district of New York City, named after and centered on the eight-block-long street running from Broadway to South Street on the East River in Lower Manhattan. Over time, the term has become a metonym for the financial markets of the United States as a whole, or...

, Gartner adopted the idea of employing senior industry people, who were in fact "peers" of their prospective clients. This was a departure from the current industry practice at the time, where analysts were relatively young and relatively inexperienced albeit bright.

Broad focus

Instead of focusing primarily on market research, Gartner emphasized a basket of "values" including : G2
G2
G2, G02, G.II, G II, or G-2 may refer to:-Media:* G2, The Guardian weekday supplement* Gladiators 2000, 1994 spinoff of American Gladiators-Fiction:...

 (competitive intelligence and analysis), quantitative methods for clients to analyze residual values and obsolescence metrics of IT hardware, saving money within the IT organization, and IT education within clients’ staffs.

Research process and organizational culture

Gartner developed a disciplined "research process", which was documented in a Research Notebook, used in regular training programs at the firm. Process highlights called for analysts to "scan" all sources of input, be trained in recognizing "patterns", develop "new ideas" from these patterns, and "document" the results in brief one-page "research notes". General industry practice at the time was to publish relatively long reports. Gartner research "gimmicks" were introduced, such as the "stalking horse", a research collaborative tool whereby analysts were compelled to graphically present and defend their logic at research meetings. Thus, the "horse" became the company mascot. Intensive research meetings for all researchers were conducted at least weekly, and provided additional training and other benefits. Other innovations were introduced, in areas such as research-hiring interview methods, conferences including the breakthrough Symposium, inquiry systems to connect clients with internal analysts. All the above contributed to an unusually strong and acknowledged organizational culture
Organizational culture
Organizational culture is defined as “A pattern of shared basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration" that have worked well enough to be considered valid and therefore, to be taught to...

.

Growth

Gartner Group was ranked among the fastest growing private firms in the U.S. (by Inc. Magazine
Inc. (magazine)
Inc. magazine, founded in 1979 and based in New York City, is a monthly publication focused on growing companies. The magazine publishes an annual list of the 500 fastest-growing private companies in the U.S., the "Inc...

) until it went public
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...

 in 1986, whereupon it was listed for several years among the best small companies in America (by Business Week
BusinessWeek
Bloomberg Businessweek, commonly and formerly known as BusinessWeek, is a weekly business magazine published by Bloomberg L.P. It is currently headquartered in New York City.- History :...

, e.g. #9 overall, and #1 in profitability, in 1987). Gartner was sold to Saatchi & Saatchi
Saatchi & Saatchi
Saatchi & Saatchi is a global advertising agency network with 140 offices in 80 countries and over 6,500 staff. It was founded in London in 1970 but now headquartered in New York. The parent company of the agency group was known as Saatchi & Saatchi PLC from 1976 to 1994, was listed on the London...

 in 1988,and Mr. Gartner signed a contract to remain as CEO until April 1991. In 1990, Mr.Gartner led a successful leveraged buyout
Leveraged buyout
A leveraged buyout occurs when an investor, typically financial sponsor, acquires a controlling interest in a company's equity and where a significant percentage of the purchase price is financed through leverage...

 of the firm financed by Information Partners, a private equity fund
Private equity fund
A private equity fund is a collective investment scheme used for making investments in various equity securities according to one of the investment strategies associated with private equity....

 owned by Bain Capital
Bain Capital
Bain Capital LLC is a Boston-based private equity firm founded in 1984 by partners from the consulting firm Bain & Company. Originally conceived as an early-stage, growth-oriented investment fund, Bain Capital today manages approximately $65 billion in assets, and its strategies include private...

 and Dunn & Bradstreet.

Gartner Group is generally recognized as the world's leading "advisory consulting" firm in the IT industries, based on annual revenues and market share
Market share
Market share is the percentage of a market accounted for by a specific entity. In a survey of nearly 200 senior marketing managers, 67 percent responded that they found the "dollar market share" metric very useful, while 61% found "unit market share" very useful.Marketers need to be able to...

.

Soundview Technologies

Mr. Gartner, who had retained contact with his Wall Street clients, initiated a new financial service for Gartner Group via a new partnership with Dillon, Read & Co.
Dillon, Read & Co.
Dillon, Read & Co. was a prominent American investment bank from the 1920s into the 1960s.-Origins:Dillon Read traces its roots to 1832 with the founding of the Wall Street brokerage firm Carpenter & Vermilye. This firm was succeeded by Read & Company in which chief principal was William A. Read. ...

, which distributed its reports and personal services
Personal Services
Personal Services is a 1987 British comedy film directed by Terry Jones and written by David Leland. It is the story of the rise of a madam of a suburban brothel which caters to older men. The story is inspired by the real experiences of Cynthia Payne, the legendary "House of Cyn" madam. The film...

 to Dillon, Read & Co.
Dillon, Read & Co.
Dillon, Read & Co. was a prominent American investment bank from the 1920s into the 1960s.-Origins:Dillon Read traces its roots to 1832 with the founding of the Wall Street brokerage firm Carpenter & Vermilye. This firm was succeeded by Read & Company in which chief principal was William A. Read. ...

 investment client organizations. Gartner Group severed the Dillon Read relationship and became an independent broker-dealer
Broker-dealer
A broker-dealer is a term used in United States financial services regulations. It is a natural person, a company or other organization that trades securities for its own account or on behalf of its customers....

 in 1984, named Gartner Securities Corp., and spun this business out to its shareholders just before its first public offering in 1986, providing its analysis, investment advice and banking services, to all institutional investors. Its name was changed in 1988 to SoundView Technology Group
SoundView Technology Group
Soundview Technology Group was an American technology-focused securities and investment banking firm known primarily for its equity research on technology and other growth oriented companies...

, when Gartner was acquired by Saatchi & Saatchi. Soundview was unique in that it combined accepted Wall Street research and distribution methods, with the intimate (albeit "arms length") relationship with Gartner analysts, and arguably became the leading technology research boutique on Wall Street. But it merged in 2000 with Wit Capital, and was eventually sold (early 2004) to Charles Schwab
Charles Schwab
Charles Schwab may refer to:*Charles M. Schwab , American steel magnate*Charles R. Schwab , founder of the eponymous brokerage*Charles Schwab Corp., an American based brokerage firm...

 Company, and thereafter completely absorbed into Schwab and UBS.

GiGa Information Group

Giga Information Group was founded by Mr. Gartner in 1995. He raised more than $15 million in several tranches to develop the company; he was Chairman and CEO until late 1999. In less than four years from first shipment (April 1, 1996 to December 1999), this innovative firm became the fastest growing technology advisory consulting company in history, generating a run rate
Run rate
In cricket, the run rate , or runs per over is the number of runs a batsman scores in an over of 6 balls. It includes all runs, even the so-called extras awarded due to errors by the bowler. Without extras and overthrows, the maximum run rate is 36 – if every ball were struck for six and, as...

 from zero to over $65 million, with more than 1,200 enterprise clients.

Three primary innovations were introduced to the advisory business through Giga : its offering of a single comprehensive IT Advisory service (compared with the typical multiple services of other advisory firms), an external cadre of experts to supplement the strategic nature of analysts on staff, and a set of web functions which stressed objectivity of analysis, and allowed on-line research by clients (called “The Knowledge Salon”).

Giga went public in 1998, but its stock languished during and after the technology stock market meltdown of 2000. In February 2003 the company was sold to Forrester Research.

Lifestyle and philanthropy

Mr. Gartner lives in Aspen, Colorado
Aspen, Colorado
The City of Aspen is a Home Rule Municipality that is the county seat and the most populous city of Pitkin County, Colorado, United States. The United States Census Bureau estimates that the city population was 5,804 in 2005...

 and the New York area, and is involved in business ventures, athletics and classical music. His music background includes a lifetime of piano practice, as well as performing on the French Horn, having been a member of the London School Symphony Orchestra, and the Brooklyn Philharmonic
Brooklyn Philharmonic
The Brooklyn Philharmonic Symphony Orchestra, commonly known as the Brooklyn Philharmonic, is an American orchestra based in the borough of Brooklyn, in New York City...

 (then called the Brooklyn Philharmonia). He is on the board of the Opera Orchestra of N.Y, is a trustee of the Music Associates of Aspen (the Aspen Music Festival and School
Aspen Music Festival and School
The Aspen Music Festival and School, founded in 1949, is an internationally renowned classical music festival that presents music in an intimate, small-town setting...

), is a fellow of the Aspen Institute
Aspen Institute
The Aspen Institute is an international nonprofit organization founded in 1950 as the Aspen Institute of Humanistic Studies. The organization is dedicated to "fostering enlightened leadership, the appreciation of timeless ideas and values, and open-minded dialogue on contemporary issues." The...

, and is on the National Councils or equivalent, of the Aspen Art Museum, and the Anderson Ranch.

He has served on the Library Committee of the M.I.T. Corporation and is a Sustaining Fellow Life Member of M.I.T. He is a past member of the board of the Society for Information Management where he was Special Appointee to the President. He is a trustee of the Charles Babbage Foundation and a member of the Board of Directors of the IT History Society
IT History Society
The IT History Society is an organization that supports the history and scholarship of information technology by encouraging, fostering, and facilitating archival and historical research...

. In the 1977 joint exhibit sponsored by the ACM and Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...

 in Washington D.C. and the Boston Computer Museum
Computer History Museum
The Computer History Museum is a museum established in 1996 in Mountain View, California, USA. The Museum is dedicated to preserving and presenting the stories and artifacts of the information age, and exploring the computing revolution and its impact on our lives.-History:The museum's origins...

, documented in the book “Wizards and Their Wonders: Portraits in Computing”, Mr. Gartner was honored as one of the 19 “Communicator” stars in the IT industry.

Mr. Gartner's professional activities have included speaking before major organizations worldwide. He has addressed graduate student groups at Harvard Business School
Harvard Business School
Harvard Business School is the graduate business school of Harvard University in Boston, Massachusetts, United States and is widely recognized as one of the top business schools in the world. The school offers the world's largest full-time MBA program, doctoral programs, and many executive...

, M.I.T., Yale, University of Georgia
University of Georgia
The University of Georgia is a public research university located in Athens, Georgia, United States. Founded in 1785, it is the oldest and largest of the state's institutions of higher learning and is one of multiple schools to claim the title of the oldest public university in the United States...

, and Arizona State, among others. In 1985, Mr. Gartner taught a course at UCLA’s Graduate School of Management (GSM), which was formally rated by his students as their best course taken throughout GSM. Mr. Gartner has also written extensively, for example, the AMA journal, series of articles for Computer Decisions and Information Week magazines, and the forward and much of Chapter 7, in “The E-Marketplace…Strategies for success in B2B eCommerce”, by Warren Raisch (McGraw Hill, 2001). He is an active angel investor
Angel investor
An angel investor or angel is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity...

 in early stage companies, and is a member of New York Angels
New York Angels
New York Angels is an organization of business angel investors based in New York, New York, US that provides equity capital for early stage companies, primarily in the field of technology and new media...

.

Sources

  • Gartner Inc. annual reports
  • Securities Exchange Commission documents
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