Staying Ahead Of The Competition: How Firms Really Manage Their Competitive Intelligence and Knowledge: Evidence from a Decade of Rapid Change

162 Pages·2007·1.39 MB·English

by  Chris Hall

Staying Ahead
of the Competition
How firms really manage their
competitive intelligence and knowledge;
evidence from a decade of rapid change
TThhiiss ppaaggee iinntteennttiioonnaallllyy lleefftt bbllaannkk
Staying Ahead
of the Competition
How firms really manage their
competitive intelligence and knowledge;
evidence from a decade of rapid change
Chris Hall
Macquarie Graduate School of Management, Australia
Babette Bensoussan
The Mindshifts Group, Australia
World Scientific
NEW JERSEY • LONDON • SINGAPORE • BEIJING • SHANGHAI • HONG KONG • TAIPEI • CHENNAI
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British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library.
STAYING AHEAD OF THE COMPETITION
How Firms Really Manage Their Competitive Intelligence and Knowledge;
Evidence from a Decade of Rapid Change
Copyright © 2007 by Chris Hall and Babette Bensoussan
All rights reserved. This book, or parts thereof, may not be reproduced in any form or by any means, electronic or
mechanical, including photocopying, recording or any information storage and retrieval system now known or to be
invented, without written permission from the Publisher.
For photocopying of material in this volume, please pay a copying fee through the Copyright Clearance Center, Inc.,
222 Rosewood Drive, Danvers, MA 01923, USA. In this case permission to photocopy is not required from the
publisher.
ISBN-13 978-981-277-906-9 (pbk)
ISBN-10 981-277-906-X (pbk)
Printed in Singapore.
Staying ahead of the competition
Introduction
This research report is written for managers who seek a competitive advantage.

There is no such thing as a sustainable competitive advantage.

Competitive advantage comes from making better competitive decisions. The
velocity of competition is increasing. Competitive decisions have to be faster. The
business environment is becoming more competitive, more global, more knowledge
based, and more dynamic. Decision makers have to deal with more complex, faster
changing issues. Decision makers need to be able to anticipate what their
competitors are likely to be doing. They need to have a corporate culture which
helps them to stay afloat and to ride ahead of the waves of competitive change.

Good competitive decisions do not come from just giving decision makers more
information. In the last ten years, it has become much easier managers to be
overwhelmed with information. This does not lead to good competitive decisions, nor
does it lead to a good competitive culture.

Good competitive decisions come from managers having "smart information" or
competitive intelligence. Good competitive decisions come from managers having
access to the information and intelligence they need to make a decision, when they
need it.

This research report provides managers with the evidence necessary to:

• understand what other firms are doing to give their managers the
intelligence they need to make good competitive decisions;

• compare this with what their own company is doing; and

• assess what their company needs to do to build the corporate systems
and culture best suited to staying ahead of the competitive tsunami.

This publication has been sponsored by Talent2

Around the world, companies seeking competitive
advantage are outsourcing HR requirements,
such as payroll, training, and executive search.
To meet this demand, Talent2 has emerged as
the first end-to-end Human Resources
Outsourcing (HRO) solutions business.

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TThhiiss ppaaggee iinntteennttiioonnaallllyy lleefftt bbllaannkk
Staying ahead of the competition
Table of Contents
INTRODUCTION..........................................................................................................1
EXECUTIVE SUMMARY...........................................................................................11
KEY IMPLICATIONS FOR SENIOR MANAGERS....................................................14
CHAPTER 1...............................................................................................................17
THE ROLE OF COMPETITIVE INTELLIGENCE IN IMPROVING CORPORATE
COMPETITIVENESS.................................................................................................17
The forces of competition....................................................................................................17
The corporate response to increased competitive forces....................................................19
Corporate competitiveness and competitive advantage......................................................19
What is CI ?.........................................................................................................................20
Stages of sophistication in CI systems................................................................................23
The role of CI in improving corporate competitive performance..........................................24
Fifty years of survey evidence on CI activity in corporations...............................................26
The research framework - a decade of empirical work.......................................................29
Intuitive CI management and professional CI management...............................................30
Improving the management of CI........................................................................................31
CHAPTER 2...............................................................................................................35
THE NEED FOR BETTER COMPETITIVE INTELLIGENCE TO COMPETE IN THE
FUTURE.....................................................................................................................35
Summary of main points......................................................................................................35
The present level of competition is extremely high.............................................................36
Changes between 1996 and 2006 in the level of competition in the market.......................38
The level of competition expected in the future is increasing..............................................39
Changes between 1996 and 2006 in the expected level of competition.............................41
The main driving needs for better CI...................................................................................41
Specific information needs by industry, by affiliation and by size.......................................43
The need to track existing competitors................................................................................43
The need to track new and potential competitors................................................................45
The need to track regulatory change...................................................................................46
The need to track socio-demographic change....................................................................48
The need to track threats and opportunities abroad............................................................49
The need to track new products and services.....................................................................50
The need to track specific new technology..........................................................................52
The need to track generic new technology..........................................................................53
The profile of CI needs by industry......................................................................................54
The effect of rate of growth on CI needs.............................................................................57
The effect of competitive velocity on CI needs....................................................................58
The effect of the length of competitive cycle on CI needs...................................................59
The implications for senior managers..................................................................................60
CHAPTER 3...............................................................................................................63
CORPORATE CAPABILITY TO DELIVER CI TO DECISION MAKERS..................63
Summary of main points......................................................................................................63
CI capability and competitiveness.......................................................................................63
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Staying ahead of the competition
Capability to compete..........................................................................................................65
Capability to track own competitive position........................................................................66
Capability to track competitors............................................................................................68
CI preparedness - capability in meeting common CI challenges........................................70
Industry profile of CI capability in dealing with common challenges...................................72
CI needs relative to capability..............................................................................................73
The implications for senior managers..................................................................................77
CHAPTER 4...............................................................................................................79
HOW CORPORATIONS MANAGE THEIR COMPETITIVE INTELLIGENCE
FUNCTION.................................................................................................................79
Summary of main points......................................................................................................79
An overview of how firms manage their CI function............................................................80
Processes and techniques used for CI................................................................................81
Sources of information for CI...............................................................................................86
Resources for CI: Cost of CI systems.................................................................................91
Resources for CI: Staffing...................................................................................................94
Who is responsible for CI?..................................................................................................96
Who should be responsible?.............................................................................................100
Plans for improvement.......................................................................................................102
Priority areas for improvement of CI capability..................................................................103
Profile of plans for capability improvement by industry.....................................................104
The implications for senior managers................................................................................106
CHAPTER 5.............................................................................................................109
BENCHMARK COMPARISONS IN CI PRACTICE.................................................109
Summary of main points....................................................................................................109
Why benchmark CI needs and capability?........................................................................109
The Competitive Intelligence Diagnostic Database...........................................................110
Using the CIS and CID for benchmark comparisons.........................................................112
Benchmark comparison of level of competition now.........................................................112
Benchmark comparison of expected competition level.....................................................114
Benchmarking CI needs....................................................................................................114
Benchmarking competitive position and competitor CI capability.....................................115
Benchmarking preparedness to address common CI challenges.....................................117
Benchmarking CI management system quality.................................................................120
Benchmarking how frequently firms update their CI..........................................................121
Benchmarking understanding of key issues......................................................................122
Benchmarking the quality of your competitive decision knowledge..................................123
The implications for senior managers................................................................................125
CHAPTER 6.............................................................................................................127
WHY DON’T CORPORATIONS MAKE BETTER USE OF CI?..............................127
Summary of main points....................................................................................................127
The intelligent puzzle.........................................................................................................127
Why has the pattern of the intelligent puzzle changed little since 1996?..........................130
Why don’t managers make better use of CI?....................................................................130
CI capability and the effect of ignorance, trust and dissonance........................................132
The role of ignorance in inhibiting CI effectiveness...........................................................132
The role of trust in inhibiting CI effectiveness....................................................................133
The role of competitive dissonance in inhibiting CI effectiveness.....................................134
The overall effect of the intelligent puzzle on CI capability................................................135
What can be done to encourage more effective use of CI ?.............................................137
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Staying ahead of the competition
Addressing ignorance........................................................................................................140
Addressing lack of trust.....................................................................................................140
Addressing competitive dissonance..................................................................................141
The implications for senior managers................................................................................142
CHAPTER 7.............................................................................................................143
THE SURVEY AND THE SAMPLE PROFILE.........................................................143
The survey method............................................................................................................143
The sample sizes and response rates...............................................................................143
The profile by industry.......................................................................................................144
The profile by affiliation......................................................................................................144
The profile by size..............................................................................................................145
The profile by management type.......................................................................................145
REFERENCES.........................................................................................................146
APPENDICES..........................................................................................................149
Appendix A Glossary of terms and conventions................................................149
Appendix B The survey instruments....................................................................150
About the authors..................................................................................................157

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