We said last week that as with any business strategy, before you begin a project you need a roadmap of what you want to accomplish and where you are going. This is why good companies follow a defined Competitive intelligence (CI) strategy that usually consists of four to five stages, depending on your corporate needs.
We reviewed in detail the ‘first stage, that is, planning and direction’. Today, we continue from that point onwards.
Once you’ve clearly plan and outline the direction of CI, you are ready to begin phase two of the process and start collecting information.
Step 2- Collect the data
After your project is fully defined and you’ve outlined the types of CI you want to uncover, it’s time for the collecting data. When collecting intelligence, good companies tap into ‘public sources, social media and human sources’ in order to gather relevant, timely and valuable, competitor data.
Public sources are easily accessible and are found online. In today’s digital world, the Internet has dramatically accelerated the speed with which anyone can track down useful material, especially on competitors.
Social media is another resource that companies should include in any competitor search. Facebook pages, Twitter accounts and many other forms of social media provide valuable insight into a corporation. Not only do they include valuable product information but you can also find customer feedback that gives you a glimpse into what customers say about the competition.
Human sources and networks, however, often provide the most valuable information on competitors and it’s wise to look inside your company for any competitor knowledge. Conduct a thorough search of competitor data that exists across the organisation. It’s as simple as asking employees what they know about competitors. In some cases, employees may have worked for a competitor and have first-hand insights they legally can share.
How precisely would you collect the data? Will it be primarily Internet-based or will you use other methods? Competitive intelligence research design must consider the feasibility of collecting desirable data, the relative cost of potential strategies and the options for metrics to determine research effectiveness. You will probably want to do a combination of research techniques to fully understand the landscape of your competitors. There’s no one size fits all approach when it comes to CI. In addition to the Internet, intelligence can be gathered from a variety of sources already mentioned.
Some experts suggest you begin research with a win/loss analysis of new customers and prospects you lost to the competition to uncover motivations behind their decisions. Reaching out to customers about six to eight weeks after a customer makes a purchase decision is ideal. During interviews, ask customers what they were looking for in a product or service, and why they did or did not choose your company. If they went with a competitor, it’s your chance to ask them why.
Ultimately, these questions will help you uncover: (1) Misunderstandings around your product/service, (2) Competitors’ selling points over your products/services, (3) Features to tweak or add, (4) Marketing message ideas, (5) Problems with the sales approach.
It’s also wise to identify industry leaders outside of your company and seek their opinions. Experts who maintain blogs or are frequent speakers at industry events are usually happy to answer questions on the industry or best practices.
Some experts claim that trade shows are one of the biggest hubs for competitive intelligence, because they are filled with industry experts, prospects and competitors, eagerly chatting on expo floors.
Step 3 - Make sense of your data
After you’ve gathered intelligence, it’s time to make sense of your data. Data analysis is one of the critical yet often overlooked steps in the CI process. But performing in-depth analysis facilitates a deeper understanding of the main drivers behind market and competitor performances, changes in customer sentiment and economic fluctuations. Remember, a successful CI project will succeed in transforming hard analytical facts into actionable results.
If you’ve gathered your own CI, analysis should focus on identifying issues, trends and factors from the external business environment that might impact your market, strategies or business functions. Companies should do a thorough analysis of trends in the following categories:
Technological—impact of new technologies and applications and IT and communication technologies.
Economic—effect of macroeconomic issues such as employment trends, interest and exchange rates, trade and tariff issues.
Environmental—including things like global warming, waste reduction and pollution control regulations.
Political—regulatory and legislative requirements and changes to governmental policies.
You can also use the data that is gathered to conduct an analysis on competitors by using a common approach that evaluates a competitor’s strengths, weaknesses, opportunities and threats (SWOT). SWOT analysis helps organisations develop a deeper understanding of a competitor’s overall impact, and helps draw conclusions about how best to deploy resources in light of the company’s internal and external situation. It also helps organisations think strategically about how to strengthen the company’s resource base for the future.
Step 4: Rendezvous with the team (i.e. dissemination and decision-making)
Thorough data collection and brilliant analysis are worthless unless the information is properly disseminated across the organisation to impact decision-making. Experts suggest that competitor data is shared regularly in a medium that makes sense to your organisation. Think newsletters, monthly summaries Intranet sites and white papers—these are just a few ideas on how to share CI data. You can also distribute ad hoc reports, comprehensive studies and special CI presentations. The key is to be consistent and to ensure that relevant data is presented to enhance decision-making on products and services.
Sharing information with the right people is imperative. After all, even the best data is worthless if it isn’t shared with the people that need it most. CI should be shared with relevant stakeholders in a relatively seamless and simple manner. An effective competitive intelligence tool will highlight information in a range of different formats and target it effectively. Keep in mind that intelligence sharing should be a two-way process; make sure you seek input and encourage feedback from all stakeholders throughout the process.
Whether you’re just starting a CI function or you already have one in place, there are some challenges. First, many organisations begin collecting information on competitors without a defined strategy. Sharp focus is essential, yet companies are often tempted to find out everything about every competitor in the marketplace. A better approach is to think of a specific question or problem that is crucial to your organisation’s success. The goal of a CI function should be to gather information that addresses a specific matter.
Now you know you don’t need a secret spy or expensive gadgetry. Hopefully, last two instalments showed that you don’t need much to become a corporate sleuth, but you do need a process and strategy. By implementing some of the ideas mentioned by us, not only will you be keeping up with the competition, but also hopefully, surpassing them. And contrary to what you’ve heard, CI is a mission that
(Lionel Wijesiri, a corporate director with over 25 years’ senior managerial experience, can be contacted at email@example.com)