The Gartner Magic Quadrant is a powerful tool that can be used for multiple purposes. Some use it in the process of pursuing acquisitions. Others use it for investments. Others use it for informing their strategies for positioning software products in the marketplace, or for acquiring software products.
This post provides an overview and explores how you might use the Gartner Magic Quadrant for project management – to gain perspective on projects, add rigor to product and project portfolio investment decisions, and choose project management software.
Basics of the Gartner Magic Quadrant
Below is the basic Gartner Magic Quadrant chart.
The two axes outline the following:
- Completeness of Vision – horizontal axis: This is a judgment by Gartner whether the vendor demonstrates a thorough vision of the market, as defined by Gartner’s analysis and view of where it is going. It also reflects the vendor’s propensity for innovation – as a market shaper or market follower. Moving to the right along this axis moves toward increasing strength of focus on tomorrow.
- Ability to Execute – vertical axis: This reflects the vendor’s capabilities in terms of resources, finances, distribution, development, and currently established market presence. Moving upward along this axis moves toward increasing strength of capabilities focused on today.
With those as the dimensions along each axis, the four quadrants, into which industry players are placed, consists of the following 4 groupings:
- Niche Players – Niche players have a viable product, but it has a relatively narrow focus and a limited vision for the future. They may be viable for some customers, but do not demonstrate a path forward for them. They also, because of their narrow focus, have a limited capability to execute a broader vision.
- Visionaries – Visionaries push the envelope with their offerings, but they face the risk that customers many not want what they offer. In addition, they are less established and are short on business execution strength – in terms of things like sales force, distribution channels, and customer service.
- Challengers – Challengers have a strong position in the market, but have not established themselves as visionaries. They have a strong customer base, and a broad range of features and functionality, but they are not investing so much in the latest cutting edge advances that could make them leaders.
- Leaders – Leaders have a broad vision of the market; established offerings across the whole range of features, functionality, and vision; and have an established base and well entrenched position in the market.
Note that the distribution of vendors in the chart will depend heavily on the maturity or stage of business development, of the market. If the market is in a state of flux or in a growth phase, vendors will tend to cluster in the visionary quadrant. More mature markets will include a higher concentration of vendors in the Niche, Challenger, and Leader quadrants.
What the Gartner Magic Quadrant Is Used For
The Gartner Magic Quadrant tool can be used for a number of purposes. Here are four:
- Assess investments – Investors can assess the viability of a business, its products, strengths and weaknesses, or just the technology.
- Identify possible acquisition candidates – An acquirer can identify companies with offerings that occupy a complementary position in the Gartner chart.
- Develop a short list of vendors for a purchase – A purchaser can think through the totality of the problem they are trying to solve, and pinpoint the vendor candidates that potentially can solve it.
- Understand a market as input for developing a competitive strategy – A company contemplating entering the market, or considering strategic steps to shift its position, can find the information highly informative and valuable.
The tool is an intelligence product. It provides insights that are hard to find anywhere else, and provides a great shortcut when compared to doing all the research on your own.
Gartner Magic Quadrant Vendor Selection Methodologies
Gartner follows a very disciplined methodology. Although it does not publish all the details of that methodologies, it does provide a broad sketch.
Gartner Magic Quadrants are produced in many market areas. Two related to project management include:
- Magic Quadrant for Project and Portfolio Management (PPM)
- Magic Quadrant for Enterprise Agile Planning Tools
A key part of the market definition/description is a listing of capabilities. For example, for PPM, these capabilities include:
- Project demand management
- Project planning and management
- Time management
- Resource management
- Resource capacity planning
- Project portfolio management
- Project collaboration
- Program management
- Reporting services
- Security and user management
These are very broadly stated capabilities, but they do capture a broad cross-section of the capabilities that are possible and desired by customers.
For enterprise agile planning tools, the capabilities include:
- Monthly, weekly and even daily incremental value delivery based on business outcomes
- Support for enterprise agile frameworks like Scaled Agile Framework (SAFe)
- Product road mapping
- Increased visibility into the flow of work
- Management of work backlogs
- Collaboration capabilities for individuals and teams
- Management of cross-team dependencies
- Release planning and forecasting
- Visibility into the financial aspects of the work being done
This listing is substantially different from the list above for PPM. In reality, since most projects use a hybrid of waterfall and agile methodologies, PM practitioners will probably want a combination of capabilities from both groups. Thus, vendors will also likely cross between two categories, such as developing project management software traversing both of the above. Some may choose to only have a portion of the features or capabilities of each.
Inclusion and Exclusion Criteria
Various criteria are used to limit the list of vendors included in the chart. They include such things as size and number of customers, variety of supporting services, geographic support, cloud support, integration capabilities, and a number of specific use cases supported.
Gartner Magic Quadrant Evaluation Methodology
The following provides a general idea of how Gartner evaluates the Ability to Execute and Completeness of Vision for the selected vendors.
Evaluation of Ability to Execute
Gartner evaluates the following factors, with proprietary weightings:
- Product or service
- Overall viability
- Sales execution/pricing
- Market responsiveness/record
- Market execution
- Customer experience
This evaluation is very thorough along the lines of capabilities and requires significant involvement of Gartner staff with vendor staff.
Evaluation of Completeness of Vision
Gartner evaluates these factors according to its own proprietary weightings:
- Market understanding
- Marketing strategy
- Sales strategy
- Offering (product/service) strategy
- Business model
- Industry/vertical strategy
- Geographic strategy
This evaluation also involves Gartner and vendor staff input and analysis and is very rigorous.
In using these evaluations, you can use those same factors to begin your own analysis, knowing that they were used in a through Gartner analysis. You can also pick and choose which to emphasize and even eliminate, and incorporate your own weightings.
Magic Quadrant Shortcomings
The tool is innovative and valuable, but it is not without its flaws. Here are three potential flaws to consider:
- Skewed to larger vendors – The reality is that for the most part, only larger vendors can pass the criteria and make the list. In addition, only larger vendors can even have the staff to support Gartner in the analysis of their products. Small vendors indeed can stay beneath the radar – whether they desire to or not.
- Lack of transparency in methodology – While Gartner provides a general outline of their methodology, they are not completely transparent. This is particularly true with the weighting of the different rating factors. It is understandable, but at the same time a shortcoming.
- Tends to alter the marketplace – The participation of vendors in the analysis means they are very invested in the process. Vendors understandably alter marketing materials, customer service practices, and product features – and how they are communicated – simply because they are included in the Gartner criteria. Gartner is very influential, and vendors seek a high Gartner rating as a prized marketing tool!
Regardless of these limitations, the Magic Quadrant provides a tremendous amount of information that can, at a minimum, provide detailed information that can have a positive impact on decisions.
Applying the Gartner Magic Quadrant for Project Management
I recommend these PM templates (paid link):
Above, I mentioned examples of Gartner Magic Quadrants for PM software – specifically in the Project and Portfolio Management (PPM) and Enterprise Agile Planning Tools defined markets.
Magic Quadrants are also very valuable in informing project and program initiatives on software development projects, where the Magic Quadrant was used to inform the strategic drivers.
To hammer home the value…
…as a project manager, think of it this way…
Earning a certification or other credential – whether a PMP, an agile certification, engineering license, IT certification, or many others – exposes you to the whole spectrum of knowledge around the particular area. In your work, you may focus on a narrower portion in practice, but that broader exposure helps you to be more versatile at approaching the problems you encounter.
When you need to analyze a particular software product, implement a solution that improves one or introduces breakthrough and disruptive features, or simply select appropriate project management software, it helps to expose yourself to the full range of disciplined analysis within that defined area. Doing so helps you to take a more versatile, informed approach to your work. That’s what the Gartner Magic Quadrant, and other related products, services, and frameworks can do for you.
I recommend these strategy resources (paid link):