Stephen Miller, editor of Competitive Intelligence magazine, says in today's global economy, if companies are not privy to changes in the corporate landscape, they're likely to be blindsided. Companies must continually gather information about their competitors to stay at the top of their game.
This collecting of little-known facts, best customer practices and knowledge about upcoming mergers and acquisitions fits into the rapidly growing industry called Competitive Intelligence (CI). Companies typically gather published information and interviews and use analytical software tools to learn about competing companies. "We believe that, certainly in the information age, collecting, managing and informing knowledge is more important than ever," says Miller. "Most of the information that companies need to know, people in the competing company already know. It's just a question of collecting and analyzing it."
John Nolan, chairman of business intelligence firm Phoenix Consulting Group and vice president of the Society of Competitive Intelligence Professionals (SCIP), says there is a growing awareness of CI's value. Nolan says the SCIP, comprised of trained professionals such as analysts, marketing managers and CRM administrators, promotes CI as a discipline bound by a strict code of ethics. The SCIP's current membership totals 7,000, up from 3,500 five years ago, and has been increasing at a 40 percent annual rate.
"The reason it's a fast-growing division is because it's becoming a business management discipline that actually works," says Nolan. "Market research is more like a photo. CI is more like a video tape with sights and sounds."
Nolan and Miller say over the past decade, many corporations have formed CI departments. "They've become a dedicated function, rather than something done separately," says Miller. Nolan says 82 percent of companies with revenue in excess of $10 billion, and 77 percent of companies with more than $5 billion in revenue have formed formal business intelligence organizations within the last five years.
John E. Prescott, professor of business administration at the University of Pittsburgh in Pennsylvania, says not only is CI an emerging trend in the United states, there is a growing awareness of CI abroad, specifically in China and in Latin America.
"I think that most companies understand that CI is necessary," says Prescott. "The only companies that shouldn't deploy CI are companies that don't have discretion over decision making, like old utilities. You're silly if you're not using intelligence."
Moore's Better Intelligence
Tom Doerner, director of enterprise sales solutions at Bannockburn, Ill.-based Moore, says CI at his company has evolved since it implemented an account-planning module in 1995. Moore provides marketing services, digital communications and print solutions to improve business processes. Now his CRM department, which consists of eight direct reports, three operational employees and 50 help desk professionals, make the sales team follow a regimented CI routine.
The sales professionals select three competitors per B2B customer and determine their reliability and credibility among each buying level and compare it with Moore's customer evaluations.
If Moore administers a bank's savings and loan business, but a competitor completes all the real estate transactions for that bank, Moore will learn of the competitor's offerings. With that knowledge, Moore may then gain an advantage in the real estate sector. "We're trying to displace our competitors from our customers," Doerner explains. "I believe CI is a matter of survival."
Doerner uses business intelligence software company stayinFront's Visual Elk transaction processing software to collect data daily and store it in a data warehouse. Every evening, the processes on the software extract data on the 10 biggest deals across the United states and Canada. The technology has the capability to list customers, competitors, sales reps and stages in the selling cycles. Visual Elk transfers the data to Moore's CRM environment, which is transmitted to the sales reps' e-mail in the morning. That vice president of sales can then swoop in and call the company in the morning to offer Moore's services.
Vermont-based CI company Fletcher/CSI has been offering its services to Fortune 500 and mid-size companies for more than 12 years. Steven B. Levy, director of business development at Fletcher, says his company regularly gathers information on its clients' competitors through database searches, collecting data from Web sites and periodicals, and interviewing marketing, sales and operations departments. Levy says his company follows a strict code of ethics, and if a person tries to divulge confidential information, the Fletcher professional stops that person from continuing.
"Sales people love to talk. Marketing people love to talk. Our people are trained at data collection and listening," Levy says. "As a result, we don't tell you what may have happened. We tell you what did happen, what is currently happening, and what will most likely happen in the future."