How "intelligent" is your intelligence?

I would venture to guess that your organization values pertinent information surrounding its industry. I would also assume that you have someone in your organization who was given the responsibility to gather and collect competitive information, likely through industry sites and tools like "Google Alerts."

So we've established that you are interested in competitive intel and that you likely have someone gathering it. What's next?

Well, what is the quality of your information? Is it fact or hearsay? The quality of your intel can drastically impact the effectiveness of your strategy....just ask Hans Blix or Collin Powell. In a perfect world every bit of information is fact and easily verifiable. In the real world you are likely required to use a little bit of your gut in determining whether or not the information is good enough to act upon.

The folks in the intelligence community have been wrestling with this issue for years. To that end they developed the Admiralty Rating Scheme. It is a code that essentially allows intelligence analysts to rate information on its reliability and credibility.

While there isn't any kind of uniform rating system in the private sector, most astute companies apply some kind of grade to the gathered intelligence. And these companies follow a similar outline. How reliable is the source of information? (Industry expert or arm chair blog hack?) And, how credible is the information. (Can it be validated elsewhere or does it make sense given everything else that you know?)

The application of a simple rating system can drastically improve your ability to turn information into intelligence that is worthy to run a strategy off of. We all know that decision making can be difficult for many companies. So when it is time for one, make sure that you are basing it on good intel.

Early warning for your competitive intelligence

I just attended a presentation sponsored by Frost & Sullivan that discussed the importance of creating an "Early Warning" system for companies so that they can effectively manage and prepare for possible events. While most of the presentation was pretty academic and vague there was one topic and slide that left a mark.

Here we go...

The graph, shown above, illustrates a valid concept. It was part of a piece shared by Ken Sawka of the firm Outward Insights. Essentially the concept states that the closer one gets to a "decision threshold", the less flexible his or her options are.

What does that mean?

He gave the following example to illuminate the point. Let's say you are a weatherman. If you receive intelligence that indicates that there will be rain in three days you can adequate prepare for the coming weather. However, if you receive that news as you are leaving for the office, you probably couldn't even of had time to grab an umbrella. Your options are limited. Point made?


What does that mean, specifically, for your business?

It is best to be able to take a longer term perspective of the threats and opportunities that surround you. By doing this and setting up potential contingency plans you can be adequately prepared should those anticipated events come to pass. It's this type of planning that could of helped....I don't know....British Petroleum.

Threats or opportunities can come in the form of many things. Deregulation, competition, technological changes, supply chain, or larger economic events are all examples of things that can drastically change your competitive environment. And the closer you get to these anticipated events the less able you are to deal with them.

So be a good boy scout, be prepared, and stay on top of your market.

Turning data into gold

The internet has been both a blessing and a curse for those of us who are in the business of turning data and information into actionable intelligence. On the plus side, we have more and more information than we could have ever wanted. Not surprisingly, this is also the downside. Plus we will also need to spend more time validating discovered information because most of it is second rate.

Here is the standard hierarchy associated with knowledge management within firms. (From least to most important)

1. Data: Facts and Observations. Ex. 1st Qtr Sales for company X are up 5% over last year.
2. Information: Collection and some synthesis of the data. Ex. The sales growth was attributed to the launch of product Y.
3. Knowledge: The mix of information, experience, and context obtained in a value adding process. Ex. The launch of product Y by Company X represents an aggressive strategy towards attacking a new market and taking on a new set of competitors.
   

An experienced practitioner of competitive intelligence will know how to effectively mine information and data so that a solid hypothesis can be created and tested. These hypotheses will ultimately guide and direct strategic decision making.

More importantly, companies need to create an environment where every employee is capable of contributing to the overall knowledge management mechanism. This involves creating an appropriate culture, providing in the necessary infrastructure, and enabling efforts through the right IT support.

A previous blog entry mentioned the Chatter tool by Salesforce.com as an excellent platform for information gathering and sharing. We've also talked about the importance of promoting information gathering and sharing through every aspect of business activity. Finally, has the organization made the gathering and synthesis of information as easy as possible for employees through a proper infrastructure.

This graph, taken from McKinsey, outlines a proper framework for designing the appropriate knowledge management or competitive intelligence program.

Salesforce.com, Chatter, and Competitive Intelligence

We are exceptionally excited to use the new Salesforce.com offering, Chatter, once it launches. Why? Because it has the potential to be an incredible platform for gathering and disseminating competitive intelligence. If it is half as cool as the presentation, it will run circles around Share Point and the other current offerings.

Take a look...

Beating the Odds as a New Venture

We are spending more and more time working with companies on the far left end of the growth curve. These are nascent enterprises that are fueled by a great idea and a desire to shake up the market place. They are enterprises that are willing to take risks in their journey of growth.

Fellow BYU alum Clark Gilbert writes a great piece for the Harvard Business Review here.
It explains that while there are many risks naturally inherent in starting a new venture, most of the successful ones are able to identify certain risks and manage them. By discovering and managing their myriad risks they are able to see a better overall result.

One of the big risks that can be minimized? A proper understanding of one's competitive environment. Hint, Hint....just sayin'.

Tough Times and the Competition: Making a Case for Competitive Intelligence

Tough Times and the Competition: Making a Case for Competitive Intelligence

Read this great article from my mentor and Thunderbird professor extraordinaire, Paul Kinsinger. Some very relevant insights regarding how competitive intelligence needs to be used during tough times like the present.

How to elicit competitive intelligence

Here is an interesting presentation from fellow T-Bird alum, Stephen Hernan. It is a general discussion on various tactics that can be employed when trying to elicit intelligence from the people managing the organizations that you might be following.

Discussion regarding the ethics of some of these recommendations aside, he does a good job of explaining how human interactions can be manipulated for the sake of gaining intelligence. As anyone who has spent time gathering competitive intelligence will tell you, getting actual actionable intelligence from a living, breathing human being is quite a more difficult and unpredictable challenge than just relying solely on secondary sources.

Good CI resource

We are always out looking for relevant resources that can enhance our understanding of important concepts. JTHawes Consulting has a great blog that delves into matters of competitive intelligence. It's worth a look.

JTHawes Blog

Tough Times and the Competition

Here is a portion of an interview given by Paul Kinsinger that is featured in the most recent edition of McKinsey Quarterly. He is a long-time pioneer in the field of Competitive Intelligence and a personal favorite professor from my days at Thunderbird.


Here is the link

President Obama, Terrorism, and Corporate Intelligence

We were all disturbed when we heard of the alleged terrorist plot that took place on Northwest Flight 253 on Christmas day. While the plot ultimately failed it unnerved a sensitive public that is forever scarred by September 11th. Almost immediately the media, policy makers, politicians, and members of the intelligence community quickly jumped into the fray to mete out blame and determine fault. This was especially disturbing considering that the intelligence community reportedly had credible intelligence on this man and possible threats to the U.S.

President Obama said it well when he stated "The system has failed in a potentially disastrous way,...The bottom line is this: The U.S. government had sufficient information to have uncovered this plot and potentially disrupt the Christmas Day attack,...But our intelligence community failed to connect those dots." Very chilling words.

Now international terrorism is far more serious, important, and wide reaching then corporate intelligence but there is still a lesson for the business community to learn. It is one thing to collect competitive information and it is a whole other thing to actively analyze and respond to this new found knowledge. We simply can't be satisfied that we are gathering information from the internet or trade shows. We need to adequately digest all of the information that we gather and act on what the intelligence says. Your inaction can lead to some serious negative consequences.

All companies should perform an internal audit to determine whether or not their current CI infrastructure is capable of connecting and acting on the disparate and distant dots that form actionable intelligence. Because we all know that it is one thing to passively monitor your competitive landscape and it is a completely other thing to harness this information in the development of sound corporate strategy.

Competitive Intelligence Case Study #1

Here is a recent example of a successful project that leveraged "competitive intelligence" to greatly enhance the sales and marketing efforts of a leading software company.