What is ‘Competitive Intelligence ‘
Competitive intelligence is the act of collecting and analyzing actionable information about competitors and the marketplace to form a business strategy. Its aim is to learn everything there is to know about the competitive environment outside your business to make the best possible decisions about how to run it. By design, competitive intelligence gathering must be performed quickly, ethically, all-encompassing, and must utilize both published and unpublished sources. It is successful when a business has a detailed enough portrait of the marketplace so that it may anticipate and respond to challenges and problems before they arise.
Breaking Down ‘Competitive Intelligence ‘
Competitive intelligence is not simply competitor analysis or “knowing your enemy.” Rather, it is knowing your competitors and the competitive landscape, as well as customers and how they fit into every aspect of the marketplace. It is also means knowing how the marketplace and a business may be disrupted by a wide variety of events, how distributors and other stakeholders could be impacted, and how new technologies can quickly render invalid every assumption.
Competitive intelligence means different things to different people within an organization. For example, to a sales representative, it may mean tactical advice on how best to bid for a lucrative contract. To top management, it may mean unique marketing insights to gain market share against a formidable competitor. For any group, the ultimate goal of competitive intelligence is to help make better decisions and enhance organizational performance by discovering risks and opportunities before they become readily apparent.
Competitive Intelligence Types
Competitive intelligence activities can be grouped into two main types: Tactical and strategic. Tactical is shorter-term and seeks to provide input into issues such as capturing market share or increasing revenues. Strategic focuses on longer-term issues such as key risks and opportunities facing the enterprise. Competitive intelligence is different from corporate or industrial espionage, which use illegal and unethical methods to gain an unfair competitive advantage.
Competitive Intelligence Sources
While most companies can find substantial information about their competitors online, competitive intelligence goes way beyond merely trawling the Internet, on the premise that the most valuable information is seldom – if ever – easily accessible online. A typical competitive intelligence study includes information and analysis from numerous sources. These include the news media, customer and competitor interviews, industry experts, trade shows and conferences, government records and public filings. But such easily accessible, widely disseminated information is only the start. It must also encompass the full breadth of a company’s stakeholders, including key distributors and suppliers, as well as customers and competitors.
In acknowledgement of the growing importance of competitive intelligence, the Society of Competitive Intelligence Professionals (SCIP) was founded in the U.S. in 1972. It underwent a name change to Strategic and Competitive Intelligence Professionals in 2010. Several companies, as well as business consultancies, provide outsourced competitive intelligence services.