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Competitive Intelligence (CI)

- Introduction Dr. Ahmed Nassar


2015 / 2016

Competitive Business Intelligence (CI)

This course gives an overview of competitive


intelligence (CI),
Competitive business intelligence promotes a
business competitive position in the marketplace.
CI can be used to:
detect competitive threats,
eliminate or lessen surprises in the marketplace,
enhance
competitive advantage by lessening
reaction time, and
find new opportunities.

Dr. Ahmed Nassar

Competitive Intelligence

Competitive Intelligence (CI)

A broad definition of competitive intelligence is the


action of defining, gathering, analyzing, and
distributing intelligence about products, customers,
competitors and any aspect of the environment
needed to support executives and managers in
making strategic decisions for an organization.

Dr. Ahmed Nassar

Competitive Intelligence

Competitive Intelligence (CI)

The term CI is often viewed as synonymous with


competitor analysis, but CI is more than analyzing
competitors it is about making the organization
more competitive relative to its entire environment:
customers, competitors, suppliers, distributors,
technologies, macro-economic data etc.

Dr. Ahmed Nassar

Competitive Intelligence

What Is Meant By CI?

CI is the product of the process by which


information is collected and transformed into
valuable intelligence for use in tactical and strategic
business decisions.
CI includes how to gather information, basic tools
and strategies, strategic thinking, and building
upon CI once it has been gathered.
CI is a necessary, ethical business discipline for
decision-making based on understanding the
competitive environment.

Dr. Ahmed Nassar

Competitive Intelligence

Questions to Business Managers

Have you ever made the wrong decision because


you had inadequate information?
Have you ever found yourself falling behind the
competition and wondering how it happened?
Have you ever wondered if there were new markets,
sales channels and breakthrough communication
programs that could take your product to the next
step in sales and profits?
If answers are yes, then you need CI.

Dr. Ahmed Nassar

Competitive Intelligence

Why CI?

The purpose of CI is to make the best decisions


based on the best available knowledge on a given
subject.
CI can reduce the risk of making a wrong business
decision.
Knowing what is going on in the marketplace and
how it will impact your company is the key to
market leadership.

Dr. Ahmed Nassar

Competitive Intelligence

Some Advantages of CI

CI provides insight into future decisions such as:


developing new marketing plans,
counteracting competitors initiatives,
considering a new product or line extension,
entering new markets,
repositioning an existing product,
investigating a strategic alliance or acquisition,
identifying new distribution channels, and
counteracting imports.

Dr. Ahmed Nassar

Competitive Intelligence

Definition of CI *

CI is a systematic and ethical program for gathering,


analyzing, and managing external information that
can affect your company's plans, decisions, and
operations.

* Society of Competitive Intelligence Professionals (SCIP)

Dr. Ahmed Nassar

Competitive Intelligence

Definition of CI * (2)

Specifically, CI is the legal collection and analysis of


information
regarding
the
capabilities,
vulnerabilities,
and
intentions
of
business
competitors, conducted by using information
databases and other "open sources" and through
ethical inquiry.

* Society of Competitive Intelligence Professionals (SCIP)

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Definition of CI * (3)

CI enables senior managers in companies of all sizes


to make informed decisions about everything from
marketing, R&D, and investing tactics to long-term
business strategies.
Effective CI is a continuous process involving the
legal and ethical collection of information, analysis
that doesn't avoid unwelcome conclusions, and
controlled dissemination of actionable intelligence to
decision makers.

* Society of Competitive Intelligence Professionals (SCIP)


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The Essence of CI

Competitive Intelligence is about Strategic Business


Analysis.
Strategic Business Analysis answers all types of
questions confronted by business.
In order to answer strategic business questions, we
need intelligence not information.

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What is Intelligence?

Unlike data or information, intelligence gives us


insights into what we think will happen based on
past behavior.
CI is forward thinking: the most recent information
is the most relevant to give us insights into the
future.
In order to create intelligence, we must go through
a conversion process.

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The CI Conversion Process

By synthesizing and analyzing data, we can


transform data into information.
Next we apply high levels of experience and insights
to information, transforming it into intelligence.
And if we can act on the intelligence, then it is
value-added in strategic decision-making.

Dr. Ahmed Nassar

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CI Conversion Diagram

Data

Analyze
Synthesize

Information
Insight

Intelligence

Experience

Competitive
Advantage
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Major Goal of CI

The main objective behind CI is to create and / or


maintain a competitive advantage against the
competition.
By using intelligence we can plan for the future
and this helps create / maintain a competitive
advantage and ultimately allows a business to
become a market leader in its industry.

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Numerous Benefits of CI
Although competitive advantage is the main
benefit of CI, there are numerous ways of
leveraging CI such as:

Benchmarking for Best Practices,


Product Pricing,
Merger & Acquisition Research,
Validate or Invalidate Rumors,
Expanding Markets, and
Identifying New Products Ideas.

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Define the CI Universe

CI Professionals often need to define a CI Universe


so they can focus on the most important things first.
A business environment map will outline forces that
impact a company, such as social change,
customers, new competition, regulatory change, etc.
These forces are then layered to distinguish levels
of importance for each force.

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Business Environment Map

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CI Project Management

For the most part, CI is executed as a project.


Most projects are very fast and tight since
management needs answers quickly.
Example: On September 12, 2001, almost every
American Corporation with operations in Pakistan
went to their CI Departments and asked: Do we
need to pull out of Pakistan and what financial
impact will this have on our company? And I need
an answer by the end of the week.

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The CI Analytical Process


CI Projects follow the scientific approach to problem
solving:
1. Define the Question,
2. Gather Data,
3. Organize the Data,
4. Synthesize and Filter the Data,
5. Analyze Appropriate Data,
6. Prepare Your Findings,
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The CI Analytical Process (2)


7. Draw meaningful insights,
8. Prepare recommendations,
9. Draft CI Report,
10. Review and Approve Report,
11. Issue Report, and
12. Follow-up and correct process.

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The Most Important Step


Defining the Question is critically important
remaining steps feed from this initial step.

since all

Example:
CEO requests information on the consumption of diet drinks in
the United States,
CI process must narrow the question down!
CEO now says he really is only interested in the consumption of
diet 7Up in Northern California,
By defining the exact question, we create a realistic scope for the
CI Project,
We can also flip the process backwards and ask the CEO: How
do you plan on using this CI information?
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CI Filtering

CI Projects almost always go through some type of


filtering process:
Some projects must be turned down to focus on
the most strategic projects.
CI resources may not be able to answer the
question.
Can the question be answered more quickly by
another department?

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Sources for CI

Most sources (70%-80%) for CI are secondary (not


first hand), such as newspapers, journals, press
releases, ads, web sites, etc.

Primary sources (first hand) include interviews,


surveys, and other direct research techniques.

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CI Characteristics

Competitive Intelligence should:


Serve as an internal advisory service within the
company.
Not be afraid of telling the truth.
Be accepted by management as a reality check
for making strategic decisions.

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CI Prevention

One of the most forgotten components within CI is


prevention,
Dont forget, your competition is doing CI against
you,
You need CI Prevention,
For example, only put minimal information into your
regulatory filings,
Be careful how you release information!
And best of all, dont be predictable in your strategic
behavior.

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Thank You Very Much

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