Reading a newspaper headline touting a product launch by your main competitor and realizing it’s the same product your company has been working on for months might rank as the worst nightmare of any business owner. Rather than waste time and effort on figuring out how you missed that one, you could try a process known as competitive intelligence to prevent future gaffs. Once reserved for big multinational companies, today’s small business owners are finding competitive intelligence extremely useful.
Not related to the CIA
Hearing the phrase Competitive Intelligence may conjure visions of international spies sneaking around behind your back, tracking your every move. In actuality, the practice is simply gathering data on a competitor through any publicly available source of information. This information will serve two purposes: first to provide a solid idea of a competitor’s plans, and second to avoid any unwelcome surprises.
“There’s a whole misconception: is it industrial espionage? Is it corporate spying? There’s a real desire to move away from that thinking,” says John Parsons, a competitive intelligence consultant and researcher in Montreal, Que. “It’s becoming accepted as a legitimate management practice.”
If you decide to hire a competitive intelligence professional, they should sit down with you and discuss what you want to know and what you will do with that information. “Generally, when I’ve done work for a smaller company, it has been that they want to know what their competitor’s sales are,” says Parsons, who is also the president of the Montreal chapter of the Society of Competitive Intelligent Professionals (SCIP). “It can be a simple question such as ‘Is my competitor expanding?’ or ‘Do they have plans to add on to their facility?’ or ‘Are they coming out with any new products next year?’ You don’t want to wake up one morning and find that your competitor has released a new product.”
Once you have established your needs, the next step is to find out where you can get the right answers. When it comes to small business, this is not always an easy process, because these companies are not required to release the same information as public corporations must under the law.
“You really have to go to the basic things like looking at press interviews where someone in one department mentions one thing and someone else in another department mentions another thing. You could even go to the local city hall, for example, and inquire if planning information has been applied for. Some jurisdictions make tax filings available,” says Parsons. Other sources of information include Internet news groups, company websites, and tools such as Performance Plus.
Keep in mind that your competitor could be conducting the same exercise to discover information about your business. Make sure your employees know that confidential information must stay within the office walls. It’s also a good idea to scan your own website or publications where you advertise to see if you are offering clues.
Uncover some bones
“It’s quite common to uncover a company’s intentions by monitoring the news groups, or certain association discussion groups. You can often find members of those groups asking very pointed questions, and those questions indicate something about what the company is thinking. Both online and offline, there are often people monitoring these groups,” says Parsons.
If you have hired a competitive intelligence professional, they will have the time to do extra legwork. Parsons includes talking to different experts, going to trade shows, events, and conferences as part of his own research methods. These professionals may even contact the competitor directly. Under the SCIP code of ethics, consultants are required to identify themselves to anyone they contact.
Examine and analyze
After you or your consultant has dug into every corner and crevice available, it’s time to work with the information. This analysis can take on several different forms, depending on your original needs. It can be a basic competitive profile, or perhaps it will be used to benchmark your company’s performance.
Once you have gone through the process with a competitive intelligence professional, you may find that you know more about your competition than you realized and can conduct the analysis exercise on your own. Parsons finds most small business owners like to take the information they have acquired and move forward on their own. If you hired a consultant who is a specialist in your area, they may be able to offer recommendations and advice beyond the basic data.
“As long as you have the appreciation for what it is and can collect the information creatively, you don’t need to have a massive budget for doing this,” says Parsons.
Some small businesses may find a SWOT analysis useful. By uncovering your competitor’s Strengths, Weaknesses, Opportunities, and Threats, you can decide how to best map a course of action to meet those categories. Use the information gathered through competitive intelligence to try to determine how your competitor’s weaknesses can become your strengths.
Source: Canadaone – Michelle Collins