Manage-Wise

Managing the competitive intelligence function

Managing your competitive intelligence function is a task in coordination and salesmanship. This landmark details the steps you will need to take in developing human networks, coordinating global efforts, guiding competitive intelligence activities, adhering to your focus, leveraging technology, evaluating the function’s efforts, making improvements, and anticipating changes that will affect your competitive intelligence function.

Human networks and global efforts

As your competitive intelligence function develops capabilities to address new demands, it will become evident that an active human intelligence network is required. Successful competitive intelligence functions develop and use decentralised, relationship-based human networks to leverage experience, expertise, and resources across their organisations. Whether tightly coordinated or decentralised in nature, internal and external human networks play a vital part in refining and upgrading competitive intelligence’s role in the organisation. Access to knowledgeable, responsive, and credible resources increases the function’s ability to deliver timely, valued products and services.

How to manage

• Be pragmatic. Conduct competitive intelligence in a practical manner aligned with company objectives.
• Produce intelligence in a variety of formats or media so that managers have easy access to intelligence in their preferred format medium.
• Focus on the future. Direct attention to what tomorrow will be like and the implications for your organisation.
• View competitive intelligence from a global perspective. Although local knowledge is vitally important, emphasise on coordinating and integrating activities on a global basis.
• Integrate formal and informal human networks. Traditional competitive intelligence literature emphasises the creation of formal intelligence networks. You must understand and draw on a network of intelligence users and producers.
• Develop and implement codes of conduct for company personnel and vendors. Be aware of differing ethical practices across the world and their potential impact on the competitive position of your organisation.

Two types of social networks

The first type is composed of competitive intelligence colleagues that exist throughout an organisation. Through a forum, dispersed competitive intelligence providers can meet on a regular basis to discuss emerging issues. Forums enable staff to interact; share best practices, experiences, and knowledge; and jointly solve problems. The forums can also support the development of new competitive intelligence functions throughout your organisation.

The second type of network links the rest of your organisation to the competitive intelligence function. This very critical network draws on pockets of expertise throughout your organisation. Identify knowledge experts in each function of the organisation, and incorporate into the competitive intelligence process as needed through cross-functional projects, guest speakers, conference calls, and informal discussions. The coordination of the diverse networks assists in the development of local competitive intelligence advocates.

There are a number of compelling reasons to coordinate human networks. First, diversified organisations have varied intelligence needs based on the different product-market arenas in which their businesses compete. Second, competitive intelligence providers are not experts in every function of a business, so they cannot be sensitive to the enormous variety of emerging competitive dynamics. Third, using networks allows your competitive intelligence function to leverage its resources, however limited. This means that your competitive intelligence function does not need to be large if it can draw on the expertise that resides throughout your organisation. The breadth of intelligence is far greater, and the costs of tapping into these networks are significantly less than producing the knowledge from scratch.

Fourth, networks eliminate silo mentalities so that people are involved in the formulation and implementation of proposed solutions. If they are part of the process, then implementation has a higher likelihood of success. As the network facilitates the successful answering of intelligence requests, it enhances the building of trust and credibility in clients and the network participants. Over time, a competitive intelligence culture becomes embedded in the social fabric of the organisation. The result is the placement of competitive intelligence personnel on strategic and tactical units where they have the capability to influence decision-making.

It is important to remember that networks take time to develop and nurture. Begin in areas where the organisation is developing its core capabilities and / or is experiencing its greatest competitive threats. When designing networks, you will choose between having a wide array of searching opportunities and the ability to transfer critical knowledge through networks. Tight or coordinated networks are usually small and consequently have limited search capabilities but strong knowledge transfer abilities.

Decentralised networks that have many weak ties spread across diverse players are excellent for gathering a lot of diverse data quickly but are weak in being able to transfer complex knowledge. Hence, the type of network that your competitive intelligence function builds should depend on the focus of its activities. A competitive intelligence function that is focussed primarily on answering ad hoc requests will tend to develop a decentralised, loose network of contacts, whereas a competitive intelligence function that conducts in-depth projects on selected focus areas will have a small network of coordinated strong ties.

Tightly coordinated network

There are five basic approaches for developing networks.

• The recruiting approach emphasises building a network in a systematic manner over time. Members of a competitive intelligence function often have as part of their job responsibility the recruitment of new members to their network. This is an aggressive approach to the development of a network. As part of the systematic approach, the competitive intelligence function will have established processes for recruiting and training network members.
• Each competitive intelligence analyst / unit member develops his or her own network but shares it with other unit members in return for theirs.
• Key stakeholders are included in any processes that can impact the organisation’s competitive position. This approach features a strong relationship between the competitive intelligence function and key stakeholders. The latter could be a business unit within the organisation or government agencies.
• Develop a network as the opportunity arises. In this approach, a competitive intelligence function typically develops relationships with the people who are working together on a project. The network expands with the number of projects completed. One of the important aspects of this approach is that network members may not be very active after a project is completed. How-ever, the relationship developed during the projects can be used in the future to identify new members and serve as testimonials for potential members of the network.

Excerpted from Competitive Intelligence by Farida Hasanali, Paige Leavitt, Darcy Lemons and John E Prescott. Reproduced with permission © 2005, Tata McGraw-Hill Publishing Company Limited. E-mail: vishwanath_mum@tatamcgraw-hill.com