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Role of Competitive Intelligence in Effective Decision Making. How to Gather, Analyze, and Use Information to Achieve Excellence!. Agenda. Four levels of competition Competitive intelligence What competitive intelligence can do for companies Why companies need competitive intelligence

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role of competitive intelligence in effective decision making

Role of Competitive Intelligence in Effective Decision Making

How to Gather, Analyze, and Use

Information to Achieve Excellence!

agenda
Agenda
  • Four levels of competition
  • Competitive intelligence
  • What competitive intelligence can do for companies
  • Why companies need competitive intelligence
  • Why companies don’t use competitive intelligence
  • The intelligence cycle
four levels of competition
Four levels of Competition
  • Brand Competition: companies offering a similar product and services to the same customers at similar prices.
  • Industry Competition: companies in the same product or class of products. E.g., Honda
  • Form Competition: companies manufacturing products that supply the same service. E.g., Honda
  • Generic Competition: companies that compete for the same consumer dollars.
noble thoughts
Noble Thoughts:
  • What enables the wise sovereign and the good general to strike and conquer, and achieve things beyond the reach of the ordinary men, is
  • Knowledge is
competitive intelligence
Competitive Intelligence

Competitive intelligence is a systematic program for gathering and analyzing information about your competitor’s activities and general business trends to further your own company’s goals.

The cornerstone of successful companies is knowledge!

what competitive intelligence can do for companies
What Competitive Intelligence Can Do for Companies
  • Anticipate changes in the marketplace
    • Failure of American automakers in the 1970s.
  • Anticipate actions of competitors
    • Verizon versus Metrophone Cellular phone systems
    • Kodak versus Fuji
  • Discover new or potential competitors
    • “Access Intel Analysts” -- Top 10 interesting companies
  • Learn from the successes and failures of others
    • Wal-Mart is indebted to Sears and JCPenneys
why companies need competitive intelligence now more than ever
Why Companies Need Competitive Intelligence Now More Than Ever
  • The pace of business is increasingly rapid
  • Information overload
  • Increased global competition from new competitors
  • Existing competition is becoming more aggressive
  • Political changes affect us quickly and forcefully
why companies don t use competitive intelligence
Why Companies Don’t Use Competitive Intelligence
  • “Nothing goes on in this industry that I don’t already know about”
  • “Nothing goes on outside this company or outside this country that’s worth watching.”
  • “Competitive intelligence is spying. It’s unethical.”
  • “American CEOs are financial in nature and not technical in nature.”
  • “Competitive intelligence is a cost center, not a profit center. It’s too expensive to implement a program.”
quantifying the benefits of c i
Quantifying the Benefits of C I
  • Effects of C I are
  • C I leads to:
    • increased quality
    • better strategic planning
    • greater knowledge of markets
    • early warning signs
    • better capitalization of opportunities
the intelligence cycle
The Intelligence Cycle
  • Planning and Direction
    • What intelligence does the company require?
  • Collection
    • Creative collectors can usually find most anything they need legally and ethically.
  • Analysis
    • Most difficult part -- weigh information, look for patterns, and come up with different scenarios.
  • Dissemination
    • Recommend and defend actions based on logical arguments.
collection
Collection
  • Types of Information
    • Primary sources: Annual reports, Government documents, Speeches, Live TV and Radio interviews, Company financial reports, Personal observations
    • Secondary sources: Newspapers, Magazines, Books, Taped and edited TV and radio programs, Analysts’ reports
  • Easy versus Difficult
    • Coors vs. Anheuser Busch
    • Japanese Paper plant in Georgia
analysis
Analysis

Analysis is the process of taking information--often seemingly unconnected information--and turning it into intelligence.

summary of analytical methods
Summary of Analytical Methods
  • Strategic Analytical Techniques
  • BCG growth/share portfolio matrix
  • GE Business screen matrix
  • Industry analysis
  • SWOT analysis
  • Value chain analysis
  • Environmental Analysis
  • Scenario analysis
  • Stakeholder analysis
  • Macroenvironmental analysis
  • Competitive and Customer Analysis
  • Blind-spot analysis
  • Competitor profile analysis
  • Customer segmentation analysis
  • Management profiling
  • Evolutionary Analysis
  • Experience curve analysis
  • Growth vector analysis
  • Patent analysis
  • S-Curve analysis
slide14

SWOT MATRIX of Competitor A

Internal Factors Strengths (S) Weaknesses (W)

1. Best technology 1. No management depth

External Factors 2. Skilled workforce 2. Spotty distribution

Opportunities (O)SO Implications WO Implications

1. Demographics favor 1-1 Keep technology 2-1 Must satisfy growing

product consumption current market segment to

2. Failing of other 2-2 Might hire skilled remain competitive

Competitor B workers from B

Threats (T)ST Implications WT Implications

1. Possible regulation 1-1 Might have to share 1-1 Management may not

technology to avoid be able to thwart

regulation regulation

2. Growing of 2-2 Keep current 2-2 C may take market

Competitor C workforce satisfied share away

name of the game
Name of the game
  • If a little knowledge is dangerous, where is the man who has so much to be out of danger.

- Thomas Huxley

  • It is pardonable to be defeated, but never to be surprised !

- Frederick the Great

  • If you can anticipate the competition’s next moves, you can outthink and outperform them.

- Ava Youngblood