Gartner in particular is known for aggressively enforcing its twelve month non-compete clause. I, like most people, carefully read and agree to any employment contract I sign, so I really don’t care if the FTC says a particular clause is not enforceable. Obviously, the FTC was not thinking about highly paid industry analysts when it voted to ban non-competes, but this move is going to have repercussions.
I was at Gartner for four years while the tech economy recovered from the dot-com bust. Gartner invested a lot in me. They put me in a position to become a recognized name. In 2003 Network World listed me as #30 in their write up of The 50 Most Powerful People in Networking. It’s the only time I have been on the same list as Bill Gates, John Chambers, Carly Fiorina, Michael Dell, John Thompson, Steve Ballmer, and Larry Ellison. #31 was Pradeep Sindhu who was founder and CTO of Juniper Networks.
It never occured to me to leave Gartner to set up shop on my own. I was well aware of the contract I had signed. Like many industry analysts I left to join a vendor. Note that Webroot Software was not in my coverage area. It is considered bad form to let a vendor in your space hire you away. I did not leave Webroot to launch IT-Harvest until 15 months later, well past the 12 month non-compete.
Of course non-compete clauses are already unenforceable in many places. Analysts outside the US have no problem leaving Gartner and hanging out their shingle. But when Tom Austin, former head of all research at Gartner, put together the Analyst Syndicate to combine our blogs and give exposure to each of the members, all of the recently departed Gartner analysts got a love letter from Gartner attorneys reminding them of their non-compete clause.
Being an industry analyst, at Gartner in particular, has become less fun than in the good old days. Workloads are horrific, compensation is good but recognition is minimal for producing great research. I will not be surprised if we see something new: Gartner analysts jumping to Forrester or Omdia and perhaps going the other way too. A free-for-all for industry analysts!
That will be a great thing for the industry. The big analyst firms will have to treat their analysts like the valuable contributors they are. Compensation may improve, as will efforts to support the core of their offerings, the analysts.
The FTC ban is not supposed to apply to executives (remember Jose Ignacio Lopez?) But, despite the titles of VP Research, industry analysts are actually individual contributors.
I would not be surprised if Gartner lawyers were huddling with management this week to discuss how to avoid brain drain. Imagine if ten or twenty of the top analysts quit to form their own firm. They could probably get funding to do so. They would need funds to hire lawyers because there are a lot more ways to shut down that kind of competition than enforcing non-compete clauses.
Tough topic. Maybe this is simplifying it too much, but someone absorbing the investment being made in them is also making an investment as well in the business (and in themselves). I see it as a two-way street. Although it certainly hurts to see someone of value (to which you've invested in) go and use that same value to compete against you...as long as employers have the right to terminate at will, I just can't argue against this ban. There are obvious cases of intentional wrong doing (on both sides). I don't dismiss that and those cases should still be addressed.