Transcript Marketing Management - BYU Marriott School

Marketing Management
Competitive
Intelligence
Paul Dishman, Ph.D.
Department of Business Management
Marriott School of Management
Brigham Young University
Lecture 6
Marketing Management
How do you really compete?
“Scale is not all positive in this business.
Cleverness is the positive in this business.”
- Bill Gates, 1993
Paul Dishman, Ph.D.
Marketing Management
How do you get to be clever?
• Out-think and out-perform the
competition
• Proactive, offensive actions
– reduce decision uncertainty
– spot new threats
– monitor competitive initiatives
– exploit competitive vulnerabilities
Paul Dishman, Ph.D.
Marketing Management
What is Competitive Intelligence?
“Competitive Intelligence is…
a systematic & ethical program
for gathering and analyzing
information about your
competitors’ activities
and general
business trends
to further your own
company’s goals.”
Larry Kahaner, 1996
Paul Dishman, Ph.D.
Marketing Management
Definitions
• Business Intelligence (BI):
– Intelligence created by information from all
external and internal elements of the business
environment
• Competitive Intelligence (CI):
– Intelligence created by information which provides
competitive advantage
• Competitive Analysis (CA):
– Analytical processes to develop competitive
intelligence for strategic decisions
Paul Dishman, Ph.D.
Marketing Management
Essence of CI
• CI is the multi-disciplinary business function of
legally gathering available information about
competitors
• Systematic, ethical research approach to
knowledge acquisition
• Industrial, company, individual research
• 80% of information is available, albeit hard to find
• Collection techniques and analysis techniques
Paul Dishman, Ph.D.
Marketing Management
Applications of CI
• Systematic environmental scanning or specific
research including market, industry, competitor
analysis for:
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Product, market changes
Actions of competitors
Industry trends (and lessons)
Acquisition targets
New technologies, processes, products
Environmental changes
Benchmarking
Paul Dishman, Ph.D.
Marketing Management
Where does CI fit in the Firm?
• Business Intelligence
– Company Intelligence
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Competitors
Customers
Suppliers
Business Relationships
Market Intelligence
Technical Intelligence
Intelligence on Individuals
Environmental Intelligence
Paul Dishman, Ph.D.
Marketing Management
Company Orientation
Customer-centered
NO
NO
YES
Product
Orientation
Customer
Orientation
Competitor
Orientation
Market
Orientation
Competitioncentered
YES
Narver & Slater, 1990
Kim & Mauborgne, 1997
Paul Dishman, Ph.D.
Marketing Management
Company Orientation
Customer-centered
NO
NO
YES
Product
Orientation
Customer
Market
Orientation
Research
Competitioncentered
YES
Narver & Slater, 1990
Kim & Mauborgne, 1997
Competitor
Orientation
Market
Orientation
Paul Dishman, Ph.D.
Marketing Management
Company Orientation
Customer-centered
NO
Competitioncentered
YES
Narver & Slater, 1990
Kim & Mauborgne, 1997
NO
YES
Product
Orientation
Customer
Market
Orientation
Research
Competitor
Market
Competitive
Orientation
Orientation
Intelligence
Paul Dishman, Ph.D.
Marketing Management
Where does CI fit in the Firm?
Competitive Intelligence
Operations
Research
- production
- audits
- benchmarking
- etc.
Technical
Research
- R&D
- IP
- competitors
- etc.
Company
Research
- suppliers
- customers
- competitors
- relationships
Market
Research
- products
- customers
- competitors
- etc.
Environmental
Research
- legal/political
- competitive
- demographic
- etc.
Competitor Intelligence
Paul Dishman, Ph.D.
Marketing Management
Business Intelligence Model
Legal
Illegal
Intelligence
Acquisition
Competitive
Intelligence
Industrial
Espionage
Intelligence
Protection
Counterintelligence
other Illegal
Acts
Paul Dishman, Ph.D.
Marketing Management
What is the CI Function and
Process?
Compile
COLLECT
Analyze
INFORMATION
DATA
KNOWLEDGE
Communicate
Apply
INTELLIGENCE
Act
DECISION
RESULTS
Decision maker
Wilson and Powell, 1994.
Paul Dishman, Ph.D.
Marketing Management
Roles within the CI Model
System
Builders
Protectors
Integrators
Decisionmakers
Knowledge
Builders
Analysts
Secondary
Primary
Researchers
Prescott, 1994
Data
Builders
Paul Dishman, Ph.D.
Marketing Management
The State of CI in Industry
• 11% of Fortune 500 have CI divisions
• 80% less than 5 years old
• P&G, Cisco, Motorola, Shell, AT&T, Lucent,
Dow, Kodak, 3M, Quest
• Baldridge Award Winners: 7 of last 10
• 13 universities in US including:
– Wharton, UCLA, U. Pitt., Drexel, AGSIM,
Indiana, Rutgers, Mercryhurst, Idaho State,
BYU
Paul Dishman, Ph.D.
Marketing Management
Who is in CI?
Type:
Work in:
Doing:
Practitioners
76.8%
A corporation
Ad Hoc requests (50%) to
tracking (50%)
Vendors or
Consultants
17.5%
Independent consultants or
consulting practice
Strategy applications of
developed CI on project &
subscription basis seminars
Academics
A university or college
Teaching research methods.
Authoring books in CI
business. Project consulting.
A university or college
Full-time studies.
2.1%
Students
3.6%
Paul Dishman, Ph.D.
Based on the membership of the Society of Competitive Intelligence Professionals
Marketing Management
Intelligence Cycle
Planning and
Direction
Collection
Analysis
Dissemination
Paul Dishman, Ph.D.
Marketing Management
Planning and Direction
• “What is the problem?”
• Clear understanding of user needs,
including time
• Collection and analysis plan
• Keep user informed
Paul Dishman, Ph.D.
Marketing Management
Collection
• Types of Information
– Primary Sources
• Annual and financial reports, Gov’t docs, speeches, live
interviews, observations
– Secondary Sources
• Publications, books, analysts’ reports, taped interviews
• Now and later
• Easy vs. difficult
• Public vs. private
Paul Dishman, Ph.D.
Marketing Management
Collection - Public Domain
• Federal
– 10-K, 10-Q, SEC, FOIA, reports
• State
– Articles of Incorporation, UCC
• Media
– Clipping service, local, classified ads
– Trade Associations
Paul Dishman, Ph.D.
Marketing Management
Collection - databases
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Investext
ABI/Inform
Dow Jones News Retrieval
Datatimes
Newsnet
Profound
Paul Dishman, Ph.D.
Marketing Management
Collection - Internet
• WWW Home pages
• Business News Groups
– clari.nb.business, clari.biz.mergers
– [email protected]
• Any Others? Usergroups? Listening
posts?
Paul Dishman, Ph.D.
Marketing Management
Analysis Techniques
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SWOT
Competitive Analysis Models
Comparative Relationships
Financial Modeling
Patent Genealogy
War Gaming (Peace Gaming)
Paul Dishman, Ph.D.
Marketing Management
Analysis
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Products
Finance
Technology
People, Organization(s)
Strategic Alliances
Manufacturing
Marketing and Advertising
Reputation
Paul Dishman, Ph.D.
Marketing Management
Dissemination
• What is the decision to be made?
• Accuracy, reliability, validity
• Best form of dissemination and
usage?
– Push vs. Pull communication
– Strategic and tactical
Paul Dishman, Ph.D.
Marketing Management
CI Checklist
• What are we collecting now?
• What are we doing with what we are
collecting?
• What should we be doing with it?
• How can we better disseminate this
knowledge?
Paul Dishman, Ph.D.
Marketing Management
CI Process
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Start with specific projects
Establish gains from CI
Instill mentality, cooperation
Train everyone!
Reward finders and users
Establish feeding process
Paul Dishman, Ph.D.
Marketing Management
Case: Toshiba
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1982 - Existing product: 16K DRAM
Market wanted 64K -> 256K
1985 - 1MB with 2x competitive yield
1987 - 4MB
How could competitors have known?
Paul Dishman, Ph.D.
Marketing Management
No James (or Jaimie) Bond
• UTSA defines trade secret as
– “not generally known, valuable because of its
secrecy, gives a competitive advantage”
• No “Company Confidential” anything
• Marketing Plans, Schematics, Rolodex, business
cards
• Do not spy
• All pertinent state and federal laws apply (UTSA)
• Economic Espionage Act of 1996
– $500K, 10 years, $5M
Paul Dishman, Ph.D.
Marketing Management
• 7,000 members - 2,000 Attendees at
Annual Conference
• 157 Information vendors
• “Company” alums + Business Intel people
• Seattle, WA
March, 2001
• www.scip.org
Paul Dishman, Ph.D.
Marketing Management
SCIP Overview
• Educational seminars & academic conferences
• Refereed journal of competitive & business strategies
(Competitive Intelligence Review), a quarterly
magazine of CI issues (Competitive Intelligence
Magazine) a monthly Actionable Intelligence
newsletter & a Membership Directory
• Supports the research & publication of materials on
competitive & business strategy.
• 50 world-wide chapters, affiliates
Paul Dishman, Ph.D.
Marketing Management
Competitive
Intelligence Review
Recent articles:
• “Application of Statistical
Process Control to Competitor
Benchmarks”
• “Technology Mapping,
Business Strategy, and Market
Opportunities”
• “Competitive Intelligence
Through Neural Networks”
• “Simulation to Analyze and
Develop Competitive
Strategies”
• “Disinformation in Corporate
Communications”
Paul Dishman, Ph.D.
Marketing Management
For more info…
Paul Dishman, Ph.D.
Marketing Management
Summary
• Systematically leverage what is already known
within the firm: “We are already doing...”
• Very little investment to gain great rewards
• Opportunity to gain short-term “good” business
• Opportunity to gain long term competitive advantage
• Necessary resource for Strategic Planning
• Provide an involvement-feedback loop for salesmarketing-production-engineering
• Enhances the learning of the entire organization
• Creates a sense of constant competition
Paul Dishman, Ph.D.
Marketing Management
How smart can we be?
“In a competitive world whose companies have
access to the same data, who will excel at
turning data into information and then
analyzing the information quickly and
intelligently enough to generate superior
knowledge?”
-Max Hopper, former Chair
Paul Dishman, Ph.D.
Marketing Management
Closing
• Questions
Paul Dishman, Ph.D.