Early Warning: Using Competitive Intelligence to Anticipate Market Shifts, Control Risk, and Create Powerful Strategies

287 Pages·2003·3.45 MB·English

by  Benjamin Gilad

E A R L Y
W A R N I N G
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E A R L Y
W A R N I N G
Using Competitive Intelligence
to Anticipate Market Shifts,
Control Risk, and Create
Powerful Strategies
Ben Gilad
AmericanManagementAssociation
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LibraryofCongressCataloging-in-PublicationData
Gilad,Benjamin.
Earlywarning:usingcompetitiveintelligencetoanticipatemarketshifts,
controlrisk,andcreatepowerfulstrategies/BenGilad.
p. cm.
Includesindex.
ISBN0-8144-0786-2(hardcover)
1. Riskmanagement. 2. Risk. 3. Strategicplanning. I. Title.
HD61.G5332003
658.15(cid:1)5—dc21 2003006506
(cid:2)2004BenjaminGilad
Allrightsreserved.
PrintedintheUnitedStatesofAmerica.
Thispublicationmaynotbereproduced,
storedinaretrievalsystem,
ortransmittedinwholeorinpart,
inanyformorbyanymeans,electronic,
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withoutthepriorwrittenpermissionofAMACOM,
adivisionofAmericanManagementAssociation,
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Printingnumber
10 9 8 7 6 5 4 3 2 1
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To my family—
Shirly, Corinne, and little Jonathan (Milo)—
with all my love.
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Contents
ListofTablesandFigures xi
Preface xiii
Acknowledgments xv
PartOne:CompaniesatRisk 1
Chapter1:Surprise! 3
Surprise Attacks 4
TheSupremacyofInternalConvictions 6
Blind Executives? 7
CanCompaniesDoBetter? 9
Manager’s Checklist 11
Chapter2:WhatDoYouKnowAboutStrategic
Risks? 13
TheVarious TypesofRisk 13
TheMostNeglectedRisk 17
TopTeamsandTopProblems 20
TheCaseofYahoo! 21
Manager’s Checklist 22
vii
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viii Contents
Chapter3:TheInternalDynamicsofEarly
WarningFailures 24
Technology“GoldenBoys” 24
Polaroid 29
Lucent 37
The“OldEconomy”andthe“Light Brigade” 42
TheOldEconomy—Procter&Gamble 42
TheLightBrigade—LeviStrauss 46
OnEarlyWarningFailureand theBigConsultants 50
Manager’sChecklist 52
Chapter4:TheAnalytical,theTactical,theCouch
Potato,andtheBlind 55
Manager’sChecklist 62
PartTwo:TheCompetitiveEarlyWarning
System 65
Chapter5:Step1:IdentifyingRisk(and
Opportunities) 67
ThinkingSystematicallyAboutRisk 71
IndustryChangeDrivers 72
Scenarios 75
IndustryChangesandthe Elusive“Strategy” 77
PrioritizingRisk 79
Summary:Identifying theHighestRisks 85
Chapter6:Step1,Continued:WarGaming 88
ConsultantsOut,DisciplineIn 90
ChoosingtheRightTypeofWarGame 92
TheCurse oftheSWOT 95
TheBlindspotsIdentificationMethodology(BIM) 97
WhatDoes ItTaketoUncoverCompetitors’
Blinders? 100
WarGamingandRiskPrioritizing 103
ASampleWarGameAgenda 103
Chapter7:Step2:IntelligenceMonitoring 108
FromRiskIdentificationtoRiskMonitoring 115
TheMonitoringNetwork:WhoWatchesWhat? 122
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Contents ix
SoWhoIsaGoodMonitor? 126
AnInternaloranExternalNetwork? 127
TheDisasterofExecutives’Networks 131
TheHighReliabilityOrganization(HRO) 132
Chapter8:Step3:ManagementAction 134
Management ActionFailures 135
A TestCase 137
Handling SPMSandMLMS 141
MaximizingtheEffectofCEW’sDeliverables 142
Management Alerts 142
Needs toKnow,WantstoKnow,What’sthe
Difference? 144
ExecutiveBriefings 146
Shouldthe BODBeBriefedToo? 148
AlertsIWould HaveWrittenIfIWere... 149
AlertsThatShouldHave BeenWritten... 152
OptionsandRecommendations 157
Never,butNever,GiveThemData 158
WhatMBAsDon’tKnow butaBiblicalTribeKnew 160
EvaluationCommittees 162
Tripwires 164
Brief ConclusionRegarding theCEW 165
Manager’s Checklist—Chapters5–8 166
PartThree:EarlyWarningat Work 169
Chapter9:CaseStudiesofCEWinAction 171
Model1. VeryLargeGlobalCompany,Complex
Operations:Citibank—CleanWindows 172
ActivitiesontheThreeStepsoftheCEWModel 174
Weaknesses (andaNoteonSillyBenchmarking) 179
Strengths 181
Model2. LargeCompany,SeveralRelatedBusinesses,
Long ProductCycle:DASA—EarlyWarning
German Style 182
ActivitiesontheThreeStepsoftheCEWModel 183
Weaknesses 190
Strengths 191
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