Benchmarking Competitive Intelligence

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Benchmarking Competitive Intelligence
Special Topics in Management
Adapted and Presented by Dale A. Henderson
Assistant Professor of Management Radford
University
Sept 25, 2002
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Agenda

• What is CI?
• What do cool CI departments look like?
• Developing CI units
• Companies with effective CI units
• Structure of CI departments
• What best practice companies offer for CI
  products
• Questions to ask when designing CI products
• How to recognize whether you have the right
  products
• How can solos work better with CI units?

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Definition of Competitive Intelligence

• Competitive intelligence (CI) is the process
  of monitoring the competitive environment. CI
• enables senior managers in companies of all
  sizes to make informed decisions about every-
• thing from marketing, RD, and investing
  tactics
• to long-term business strategies. Effective
  CI is
• a continuous process involving the legal and
  ethical collection of information, analysis that
  doesn't avoid unwelcome conclusions, and
  controlled dissemination of actionable
  intelligence to decision makers.
• Source Society of Competitive Intelligence
  Professionals

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Definition of Competitive Intelligence

• Competitive intelligence is a systematic
  program for gathering and analyzing information
  about your competitors activities and general
  business trends to further your own companys
  goal.
• Source Larry Kahaner,
  Competitive Intelligence

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What Makes a Good Competitive Intelligence
Program?

• 1. Evolving, yet stable, CI infrastructures
• 2. Decentralized -- coordinated networks
• 3. Responsive IT system operating as a learning
  system
• 4. Strong links between tactical and strategic CI
• 5. Customer-feedback-implementation linkage
• 6. Hypothesis-driven recommendations-improves
  decision making
• 7. Institutionalizing intelligence cultures with
  appropriate rewards
• 8. FIICH Model Focus, Implement,
  Institutionalize, Change, Hone
• 9. TAP IN Model Teams, Allocation, Planning,
  Interaction, Networks

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Companies with Good CI Programs

• Bell Atlantic Xerox
• Eastman Kodak Skandia
• Ford SDG
• Merck Amoco
• Pacific Enterprises Sequent
• American Express Boehringer Ingelheim
• Procter Gamble Dow Chemical
• MetLife SBC Operations

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Five Keys to Developing a CI Unit

• 1. Establish the intelligence process first how
  you
• will operate.
• 2. Begin with clearly defined roles and
• responsibilities.
• 3. Establish a seamless intelligence
  communication
• strategy within the company.
• 4. Build awareness slowly with key successes.
• 5. Dont get caught in the activity trap of
  answering
• everyones questions.

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Amocos CI Organizational Structure
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Boehringer Ingelheim CI Organizational Structure
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CI Information Request
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CI Product Development

• Data transformed becomes information.
• Information transformed becomes intelligence.
• Intelligence transformed becomes competitive
  advantage.

Senior
Senior


Business Intelligence Functions
Management
Management
Function
Function
Analysis
and
Implications
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Types of Projects/Products

• Types of Projects/Products
• Proprietary researching, reporting, and
  assessment of the implications of competitors
  activities and operational industry trends
• Characterization of the external competitive
  environment and analysis of key competitors based
  on proprietary and publicly available information
  resources such as
• comparative assessments of competitor performance
  and gaps
• implications of competitor strategies,
  performance and drivers of success and
• benchmarking studies on focused competitive
  issues
• Training for competitor response modeling, ethics
  and counterintelligence
• Development of proprietary databases of experts,
  financial data, and analytically based knowledge
  products

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Determining the CI Product

• Questions to ask
• What variety of products should be offered to
  meet the needs of our customers?
• For each CI product, what level of resources
  should be invested?
• What benefits will be derived from each
  portfolio?
• What other parts of the organization should you
  partner with to design and implement the CI
  product?

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Four Keys to Developing Products

• CI Products Should
• Assist managers in solving a program,
• Impart to the user CI knowledge skills,
• be designed and evolve with input from users, and
• stretch the capabilities in the CI knowledge
  domain.

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How Do You Know If You Have the Right Products?

• An open-access culture is fostered.
• Geographical, cultural and time barriers are
  reduced.
• Tacit knowledge becomes explicit knowledge.
• Institutional memory is created.
• Managers trust and use CI products to make
  decisions.
• CI knowledge use becomes a way of doing business.
• The CI knowledge process becomes fun.

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Some of the Roles Employees Can Play in CI

• Information research for Intelligence analysis
• Identification of intelligence (human) sources
• Verification of human source reporting
• Production of value-added newsletters
• Maintain intelligence databases

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What CI Products Can Employees Assist With?

• Current Intelligence
• Basic Intelligence
• Technical Intelligence
• Early-Warning Intelligence
• Estimated Intelligence
• Work Group Intelligence
• Targeted Intelligence
• Crisis Intelligence
• Foreign Intelligence
• Counterintelligence

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Next Steps!

• Decide what part you and/or your firm should play
  in the CI process.
• Think about what value you and your firm can
  bring to the CI process.
• Present and discuss your plans with senior
  management or the CI manager if you have one.
• Partner with other groups to achieve success.
  Remember, no one group can do it all!