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Competitive Intelligence

Competitive Intelligence – ‘Millennium Intelligence for Winning Businesses’

A Book from Himalaya Publishing House

 ISBN 978-93-5202-987-7      PCG 665

Author(s) : Amit Johri    Akshai Aggarwal

Why Engage in Intelligence?

‘Every morning, a Gazelle awakens in Africa.

She knows she will have to run faster than the fastest Lion that day

Or she will die.

Every morning, the Lion awakens

He knows he will have to catch the slowest Gazelle

Or he will die of hunger.

It does not matter if you are the Gazelle or the Lion

When the Sun rises, you should start running’.

                                      (Muhammad Ibn Raschid Al Maktum)

A company’s environment is no longer what it used to be. It is deeply affected by a much higher flow of information and a fast pace of technological change. Also the pressure to innovate and to innovate fast is higher than ever before.

Increasing globalization of markets makes monitoring and analysis of the competitive landscape important. No company, regardless of size, can afford not be informed about its market environment, competitor’s products, prices, sales channels, and communication activities.

Competitive pressure is on the rise because of new market entrants, technological progress, and increasing globalization.

Governments are also getting more involved in business affairs, showing clear signs of protectionism and preferential treatment towards state-owned companies.

The reaction of competitors to a company’s strategy and the recognition of early warning signs in the market needs to be incorporated into an evolving corporate strategy. Without actual (market) information, product development, product adjustment, market development are based on mere assumptions and is similar to driving a car in fog.

Intelligence is therefore of utmost strategic importance for every company.

Even the German Gods Engaged in Intelligence      

German God Odin had two agents called Hugin (Thought) and Munin (Memory). Disguised as ravens, they both flew out in the world each day to gather information for Odin. Nothing could hide from their discerning gaze, and when they returned to Odin, they would land on his shoulder and whisper their thoughts and memories into his ear.

Intelligence is a systematic management method.

Competitive Intelligence is an approach to study and monitor the competitors and market environment in a continuous, systematic and a thorough manner whilst transforming this information into useful decision support to achieve strategic competitive advantage.

Tactical/Strategic Intelligence Instruments and Methods

‘If you know yourself and you know your enemy, you will win each battle

If you know yourself but not know your enemy, you will lose one battle for each battle you win

But if you know neither yourself nor your enemy, you are a fool and you will lose every battle’

                                                                                                          (Sun Tzu, Art of War)

Intelligence deals with a long-term strategic method as well as a short-term tactical instrument. Ideally, Intelligence deals with both.

The Value

Intelligence is of strategic importance for every company. In addition, by providing relevant past, present and future information of the competitive landscape, intelligence serves not only strategic but also operational and tactical decision-making and helps to identify emerging opportunities and risks early on. In practice, Intelligence and reaching the related goals and targets give companies a diverse range of benefits.

Competing for Business

To know your enemy, you must become your enemy said Sun Tzu in The Art of War. Sometimes competing for business can seem like a battle, where the odds are stacked against you and the odds of success are insurmountable.

All is not lost however Competitive Intelligence is the key weapon in leveling the battlefield and allowing you to compete with the advantage of knowledge on your side.

Competitive Intelligence is the ethical gathering and analysis of competitor, customer and market information from open sources. This analysis is used by organizations to make better strategic decisions. It is the difference between Competing and Winning.

Embedding Competitive Intelligence as a core management process is increasingly essential towards survival and growth in the 21^st century.

Best Practices for Managing Competitive Intelligence: Qualify Your Tenders

Tendering is expensive; Compete only where it makes good sense; Learn as much from loosing as from winning.

Each time you participate in the tendering process, you learn a little more about what it takes to win. As Sun Tzu noted ‘Opportunities multiply as they are seized’.

Competitive Intelligence   What you don’t know Will Hurt You

In today’s complex and fast-moving world, what we need even more than foresight and hindsight is insight – Napoleon Bonaparte

Start with the Customers Not the Competitors

Management Guru Peter Drucker said “the purpose of business is to create and keep a customer”. Obviously, right? Companies that provide prospects with what they want are rewarded with sales, customers and market share. Simple!

How Industry forces Influence Profitability?

In “Business @ the Speed of Thought : Using a Digital Nervous System”, Bill Gates wrote : “The most meaningful way to differentiate your company from your competition, the best way to put distance between you and the crowd, is to do an outstanding job with information. How you gather, manage and use information will determine whether you win or lose”.

Staying Hyper Competitive

There is a Chinese saying:

Know thy-self, know thy competition, and get it right almost every time.

Know thy-self, not know thy competition, and get it right about half the time.

Not know thy self, not know thy competition, and get it wrong almost every time.

We live in a world driven by hyper competition. The knowledge base for managing in this hyper competitive environment is called Competitive Intelligence.

“Strategy without Tactics is the slowest route to Victory. Tactics without Strategy is the noise before the defeat”. Sun Tzu “The Art of War”