Effective Competitive Intelligence - Problem 4: Communication

In my last post, I started talking again about effective competitive intelligence. Again, my definition of effectiveness is:

– Strengthen your company’s position
• How is our value proposition perceived?
• What is the competition doing?
• Which industry-wide best practices will truly apply?
– Discover new markets
• What is possible with new technologies?
• Where should we steer the company?
– Develop new products/services/solutions
• What problems do our clients experience that we can address?

One of the biggest complaints of Competitive Intelligence generators and users alike is the fact that intelligence, information and knowledge in general is lost in the shuffle. In fact, according to an Accenture study:

53% of obtained information is worthless

31% say that it Competitive Intelligence is hard to get at

57% have to go to numerous sources to compile necessary intelligence

45% can’t find information on other departments’ activities

42% accidentally use the wrong information once per week

40% say other parts of the company won’t share information

59% say there is poor distribution of information

Many of these problems are the result of poor corporate communication.


In summary, we find that intelligence suffers from the fact that organized distribution channels don’t exist (If a tree falls in the woods…).

If you have created a quality library of information, its value is compromised by the fact that people:

Don’t know it exists

Can’t read it

Don’t like the way it is distributed

This same topic was addressed in our recent webinar which can be downloaded HERE.

How do you solve this problem?

1. Start with intelligence that means something to others.
2. Speak with a loud voice and be available to others in decision-making posts
3. Find internal champions
4. Determine that the intelligence will be received and reviewed

You’ll note that I haven’t mentioned anything about content management systems or other technologies. Before you can install software to distribute intelligence, you have to create a hunger for it and establish communication channels that work. Otherwise, you’re likely to spend quite a bit of money on software that will lie dormant most of the time.

If you have a success story with overcoming the communication barrier, drop me a note. I’m always interested in examples of success, no matter how small they may seem (cdalley@primary-intel.com, 801-838-9600 x5050)

Increasing ROI from Competitive Intelligence Efforts

If you have a CI program, take a minute to measure the ROI of your efforts. Instead of simply building a large library of information, ask yourself the following questions:

• Top-line Revenue
– Will this intelligence create new revenue opportunities?
– Will we take away sales from the competition?
– Will our existing accounts stay longer and be more profitable?
• Bottom-line
– Can we be more efficient or learn best practices?
– Are there better ways to manage our processes?
• Application
– How easily will we be able to act on these data?

If you are able to identify areas where you are directly increase top or bottom-line revenue, you are one of the rare success stories in competitive intelligence. If you are like the majority, you may want to consider some of the following tips:

• Reactive CI does not constitute a program. Develop an intelligence program that helps sales, marketing and product development informed of the competition's movements in the most strategic areas. Ignore all of the other noise.
• Information becomes “must have” when executives depend on it to move forward. Understand the willingness of your executives to use intelligence to make decisions. Determine which types of intelligence are best received. Don't spend time developing programs that produce data that won't be used.
• Do not assume that “stacks of information” are better than smaller quantities of targeted intelligence. Busy work does not equal effectiveness.
• Determine WHAT to investigate before starting a search. If you don't have a goal in mind, you will end up on wild goose chases. Everything begins to look appealing if you don't know what you're after.

Use these tips to work with your manager and executives to create a program rather than a competitive intelligence library.

Competitive Intelligence, Analytics and Your Job

Where can analytics benefit a company in its competitive intelligence program? Can the application of analytics to specific performance areas (vs. the competition) provide a competitive advantage? Such areas include:

• Supply Chain
• Loyalty
• Pricing
• Human Capital
• Product and Service Quality
• Financial Performance
• Research and Development

While many of these areas would seem to be analysis of internal processes, these same techniques can be applied to outside influences as well, including the competitive landscape.

And, nobody has to apologize for categorizing the refinement of internal processes as competitive intelligence. If a company can gain a bigger competitive advantage by studying itself rather than the competition, why wouldn’t you consider this method?


FUNCTION/DESCRIPTION/EXEMPLARS
Supply chain – Simulate and optimize supply chain flows; reduce inventory and stock-outs. (Dell, Wal-Mart, Amazon)

Customer selection, loyalty, and service – Identify customers with the greatest profit potential; increase likelihood that they will want the product or service offering; retain their loyalty. (Harrah’s, Capital One, Barclays

Pricing – Identify the price that will maximize yield, or profit. (Progressive, Marriott)

Human capital – Select the best employees for particular tasks or jobs, at particular compensation levels. (New England Patriots, Oakland A’s, Boston Red Sox)

Product and service quality – Detect quality problems early and minimize them. (Honda, Intel)

Financial performance – Better understand the drivers of financial performance and the effects of nonfinancial factors. (MCI, Verizon)

Research and development – Improve quality, efficacy and, where applicable, safety of products and services (Novartis, Amazon, Yahoo)

(Davenport, Thomas H. (2006), “Competing on Analytics”, Harvard Business Review, page 6)

Some competitive intelligence professionals are taking the lead in this area and expanding their skill set to include predictive analytics and advanced statistics. Others are still working on creating libraries of information and relying on gut feelings and intuition to provide direction to the company.

Watch for graduates to come out of school with advanced degrees in business analytics. They will be in very high demand in the near future. If you don’t understand these concepts, you may be working for a dinosaur. If your company isn’t a dinosaur, you may have to find a job working for one as the highly skilled analytics experts move in.

Sorry about the doom and gloom. But, that’s where I see things heading. I recommend moving ahead of the curve and adding some additional analytic training to your repertoire.

Of course, Primary Intelligence stands ready to put predictive analytics into your Win Loss and Account Loyalty programs right now. If you have a couple of minutes, give me a call and I’ll show you how. (cdalley@primary-intel.com, 801-838-9600 x5050)

Forward-thinking Competitive Intelligence

I read a blog entry about “reactionary competitive intelligence” that you ought to read. It is simple, but makes a strong point.:

Follow The Leader
Have you worked at a company where a significant share of the business strategy is determined by what competitors are doing?

Have you worked on a product plan that includes features based not necessarily on what your customers have asked for, but based on what your competitors already have?

Have you bought ad space in a magazine because that's where your competitors are advertising as well?

Assuming that our competitors know what they're doing is a dangerous game. Assuming your company has the right ingredients and circumstances to match or exceed their success is an equally slippery slope.

Competitive intelligence is critical, and identifying elements of a competitor's business and marketing strategy for further review and testing is a great idea.

But do your own homework. Know your customers, your industry, and your business better than anyone else. Don't just follow the leader. (Matt Heinz, Matt on Marketing)

Does your company culture and leadership support a forward-thinking intelligence strategy? Are you encouraged to scout out a trail to new ground or is your time dominated by reactionary “what just happened” questions?

You can discern your company’s cultural bias easily by answering the following questions for yourself:

-Do competitive surprises throw us into a frenzy or do we hold the course on our own strategy?
-Does our CI strategy remain constant or does it change with the blowing winds of businsess?
-Do we study way to increase business and retain contracts or are we more concerned with knowing trivial facts about the competition?
-Does our company use cutting-edge analytics or do we still make decisions based on gut feeling alone?

If your organization is stable and includes the support of leadership, you are poised to do good work and your efforts will have to match expectations. If not (and if you want to be forward thinking), you are going to have to work very hard to change the current scenario. Otherwise, you risk becoming an order taker with no end in sight. And, those people who bring interesting, but non-impactful, information to the table usually don’t go very far.

And, if that assessment is too harsh, my apologies. But, I have a great deal of respect for those CI professionals that don’t settle for trivialities, but work to find the strategic areas of opportunity for their company. The highest rung on the ladder is reserved for those that have the experience, clout and voice to insist that the intelligence be used in the executive boardroom for decisions.

Let me know what you think. I would like to hear from you (cdalley@primary-intel.com, 801.838.9600 x5050)

Competitive Intelligence and TOO MUCH DATA!

Ron Sathoff (an associate of mine at Primary Intelligence) brought me the results of a study from Advertising Age. The most interesting chart was called, "What Middle Managers Say About Obtaining Necessary Data" and the responses to the survey were generated from 1,009 US and UK respondents in January 2007.

(Source: Advertising Age, Digital Marketing & Media Fast Pack, Published April 23, 2007, Copyright 2007 Crain Communications Inc.)

If you are a competitive intelligence professional, you have to focus on improving the:

-relevancy of your data
-distribution methods of your data

If you consider that 59% say they can’t find existing information, 45% say that they don’t know what the rest of the company is doing and 40% of the respondents say that other parts of the company won’t share info, you have 144% of the people that are experiencing a problem.

Well, that’s not quite right (and you can see the my statistics training didn’t really stick), but it sure seems odd to me that this many managers are not able to find the information necessary to do their jobs better.

So how does a company overcome these obstacles and distribute information more effectively?

1- Someone in the organization has to understand and coordinate the primary
intelligence-gathering campaigns. Depending on the size of the organization,
this may be a difficult task, but a Director of CI should be able to compile and
update a basic list

2- This list needs to be distributed to different levels of management.
People in the organization need to know what is available.

3- If you have a “librarian” that catalogues the data, it is not enough
to “store” it in convenient places. Reports need to be advertised. Data needs to
be presented. Even an internal company newsletter to managers and execs would
help to serve the purpose. But, nobody can hide behind the excuse, “That report
has been posted to the intranet for months. They should have known.” You have to
innovate to distribute intelligence effectively

4- Road shows – Take data on the road. Summarize reports. Go to
scheduled meetings, whether the meeting is down the hall or down the interstate.

5- Build trust with rogue departments that don’t want to share data.
Find out why they want to hold it so close to the vest and work your way into
their trust

6- Recommend consultants to help departments build in the resident
intelligence. Some data recipients like to read reports and distill the results
into their own recommendations. The majority prefers to get the summary, next
steps and action plan. If this is in your comfort zone, go for it. If not, get
outside expertise.

This is the information age. Companies run on intelligence. They run efficiently and better than the competition when they run on the right data at the right time.

If you are an order taker, stop. You still have to listen, but you have to do more than run projects on an as-needed basis. Take responsibility for your company’s intelligence and make it work for more people.

If you have thoughts, questions or suggestions, contact me (cdalley@primary-intel.com, 801-838-9600 x5050)

Librarians are boring. And, of limited value

This morning, I read an article summary which provides information on establishing a library of Competitive Intelligence.





While it is important to gather information, too many companies settle for too much information and too few results.

Pretty soon, you have a big, dark library of information and a librarian that serves as caretaker rather than consultant or expert.



While a “library” of information needs to be collected to power a CI program, let’s not get lost on the fact that piles of information don’t necessarily mean that you have the power to win more business.

In other words, if an exec approaches the library with the question, “What information in these stacks will improve our win rate by 10% this fiscal year,” how does the librarian answer that question?

And, if there is no answer, what is the value of the library?

For my ideas on how to avoid the “useless librarian syndrome,” check out this webinar and find out how to create ROI with your CI.