Competitive Intelligence
Competitive
intelligence
The term competitive intelligence is often
used as a synonym for business
intelligence. Competitive Intelligence may be defined as the action of gathering, analyzing, and
applying information about products, domain constituents, customers, and
competitors for the short term and long term planning needs of an
organization. Competitive Intelligence (CI) is both a process and a
product. The process of collecting, storing and analyzing information
about the competitive arena results in the actionable output of
intelligence ascertained by the needs prescribed by an organization.
Key points of
this definitions (Competitive Intelligence):
-
Competitive Intelligence is an ethical
and legal business practice. (This is important as CI professionals
emphasize that the discipline is not the same as industrial
espionage which is both unethical and usually illegal).
-
The focus is on the external business
environment.
-
There is a process involved in
gathering information, converting it into intelligence and then
utilizing this in business decision making. CI professionals
emphasize that if the intelligence gathered is not usable (or
actionable) then it is not intelligence.
A more focused definition of CI regards it
as the organizational function responsible for the early identification
of risks and opportunities in the market before they become obvious.
This definition focuses attention on the difference between
dissemination of widely available factual information (such as market
statistics, financial reports, newspaper clippings) performed by
functions such as libraries and information centers, and competitive
intelligence which is a perspective on developments and events aimed at
yielding a competitive edge.
The term CI is often viewed as synonymous
with Competitor analysis but Competitive Intelligence is more than
analyzing competitors — it is about making the organization more
competitive relative to its existing set of competitors and potential
competitors. Customers and key external stakeholders define the set of
competitors for the organization and, in so doing, describe what could
be a substitute for the business, votes, donations or other activities
of the organization. The term is often abbreviated as CI, and most large
businesses now have some Competitive Intelligences functions with staff
involved often being members of professional associations such as the
Society of Competitive Intelligence Professionals.
The Society of Competitive Intelligence
Professionals (SCIP) is an organization for those who are interested in
learning more about Competitive Intelligence. Established in 1986, it
provides education and networking opportunities for business
professionals, and provide up to date market research and analysis.
“Members of the SCIP have backgrounds in market research, strategic
analysis, science and technology.”
Competitive intelligence is all about
analyzing relevant business environment information on an ongoing basis.
It includes keeping an eye on:
- Competitors
- Technology
- Legal and regulatory changes
- Suppliers
- Materials
- Industry and market trends
- Political and economic changes
Being aware of critical issues
generates insights, enables new ideas and helps owners and managers make
informed decisions regarding future events.
To be effective, competitive
intelligence needs to become part of the business culture, a strategy
needs to be defined, a plan assembled and implemented. Ethical sourcing
and use of the information is critical.
References:
http://en.wikipedia.org/wiki/Competitive_intelligence
http://www.ic.gc.ca/eic/site/dir-ect.nsf/eng/uw00740.html
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