STRATEGIC
ADVANCEMENT OF INTELLIGENCE
As we all know that the knowledge
based era has come upon us and our survival into future will depend upon only
one thing that is KNOWLEDGE.
We will
have to know more to do more!
Now the question is will the companies
continue to wait far in the market evolution under the current competitive model
in hope that they achieve sufficient intelligence organically?
Or we first provide the
environment where enabled companies thrive under the new SAI model in order to
accelerate the global growth in market leadership and utilization!
By continuing the current
competitive model, it is evident that no human intelligence can cope with the
challenges of the future only by intentionally facing the difficult global
competition to engage with the market environment where all companies thrive by
simply responding to the emerging scenarios.
Elimination of the slow and indecisive
companies is otherwise certain!
Additionally, the longer we
fail to provide the environment where a company can thrive, the greater the
risks that the company will not survive long enough to achieve sufficient
intelligence utilization necessary to solve the challenging future scenarios
emerging from competitor activities.
Companies
have long considered data collection and analysis to be fundamental activities
for long term strategic planning. Before the rise of the Information Age, most
decision making was based on guess-work or trial-and-error practices.
Businesses seeking to achieve a sustainable advantage over their competition
quickly turned to information management systems for detailed data analysis.
These systems and methods have evolved to what is now known by the broader term
"business intelligence" or "BI". Business intelligence
refers to in-depth analysis of company data for better decision-making. The
technology and processes that make this analysis possible take unwieldy
collections of information and translate them into organized,
readily-accessible, human-readable compilations of data. With an effective BI
tool, companies can easily track their own operations, their customers'
activity patterns, and industry trends. These fact-based assessments help
companies work toward specific goals with confidence.
HOWEVER
THE AGE OF BUSINESS INTELLIGENCE IS OVER AND THE AGE OF STRATEGIC ADVANCEMENT
OF INTELLIGENCE IS UPON US!
What is Strategic Advancement of
Intelligence? How does Strategic Advancement of Intelligence fit into the
strategic planning process? What is the role of knowledge management and how
does it relate to Strategic Advancement of Intelligence? Is competitor analysis
identical to Strategic Advancement of Intelligence? How can Strategic
Advancement of Intelligence become part of a corporate intranet strategy? How
do the companies train their employees to beware of corporate espionage and
protect their intellectual property? Do the companies they compete with engage
in Strategic Advancement of Intelligence on them and what is the effectiveness
of their Strategic Advancement of Intelligence process? How to measure the
effectiveness of their own SAI process?
The
question of what Strategic Advancement of Intelligence (SAI) consists of is not
as necessary to understanding its importance in business than understanding a
bigger and more important question -- why do some firms in an industry win and
achieve hegemony where others, often with superior resources, fail?
In short, SAI is the purposeful
and coordinated monitoring of the competitor(s) of an organization,
wherever and whoever they may be, within a specific marketplace...
The "competitors" are those firms which they consider rivals in
business, and with whom they compete for market share. SAI also has
to do with determining what their business rivals WILL DO before they
do it. Strategically, to gain foreknowledge of their
competitor's plans and to plan their business strategy to countervail other’s
plans.
As one might expect, this will
involve many methods at the tactical collection level, but it
will also require integration into the existing information
system of the company infrastructure, analysis and distribution of
the information, and finally, the calculation of business decisions on
the grounds of that information and the analysis of same. This is the
"intelligence" part of the formula.
Most of the value-added in
manufacturing or product companies is created by knowledge-based service
activities such as research and development, marketing research, product
design, customer service, advertising, or distribution.
Winning firms are organizations that most successfully master the business issues critical to
their performance, and develop the most precise understanding of definitions of
value and creation of value.
Competitive advantage has a lot
to do with leveraging the knowledge assets of the firm, while at the same time
determining how competitors are likely to leverage theirs.
The goals of this explanation are
many:
· Adopt a strategic approach to
the use of Strategic Advancement of Intelligence; to see the intelligence function
as an integral part of strategy formulation.
· Show how Strategic Advancement
of Intelligence is used by firms to achieve competitive advantage.
· Examine the process, the
tools, and the output of SAI on web 2.0
A Fortune 500 company survey
showed 55 percent make use of SAI in composing business strategy.
Each firm is a leader in its
industry and each firm knows its enemies.
Companies and industries prosper
through improvements in competitiveness, leveraging core competencies, and
Strategic Advancement of Intelligence is at the core of the objective of
improving competitive advantage.
Strategic
Advancement of Intelligence is the core of competitive strategy
Why do evidently great
organizations with great products, wise managers, and other successful
strengths, go out of business?
Economies of scale, the
foundation on which big companies have based their dominance in the Industrial
Era, is no longer an advantage.
Revolutionary changes in information
technology, in the financial system, in just-in-time production techniques, and
in the rise of companies offering distribution and support systems which
previously only the largest companies could afford are removing the advantages
of being big.
The diseconomies of scale - low
overhead, high-flexibility are becoming increasingly powerful to gain market
foot hold in the new age digital economy.
Value of
Strategic Advancement of Intelligence
Here are just a few of the
questions firms ask themselves when implementing a SAI programme:
· How do we most usefully define
the company's mission, its strategic intentions, its objectives and its
strategic choices?
· What do we need to know to
develop and to select strategies which are not only successful, but
sustainable?
· What new products should we
build and which markets should we enter and how?
· How do we implement our
competitive strategy?
Whatever strategic framework the
firm chooses to embrace for the management of its business, no one element
remains more fundamental to competitive strategy than Strategic Advancement of
Intelligence.
Strategic Advancement of
Intelligence is more concerned with doing the right thing, than doing the thing
right.
The goal of a competitor analysis
is to develop a profile of the nature of strategy changes each competitor might
make, each competitor's possible response to the range of likely strategic
moves other firms could make, and each competitor's likely reaction to industry
changes and environmental shifts that might take place.
Strategic Advancement of
Intelligence should have a single-minded objective -- to develop the strategies
and tactics necessary to transfer market share profitably and consistently from
specific competitors to the company.
A firm which does not rigorously
monitor and analyze key competitors is poorly-equipped to compose and deploy
effective competitive strategy and this approach leaves the firm and its
markets vulnerable to attack. The basis for SAI revolves around
decisions made by managers about the positioning of a business to
maximize the value of the capabilities that distinguish it from its
competitors. Failure to collect, analyze and act upon competitive information
in an organized fashion can lead to the failure of the firm itself.
What then is Strategic
Advancement of Intelligence?
How do we define it?
In what ways does it differ from
market research?
How is it used to make companies
more competitive?
Who needs Strategic Advancement
of Intelligence?
How is it managed?
How is it produced?
How should Strategic Advancement
of Intelligence be used?
By whom?
What are its costs?
Where does Strategic Advancement
of Intelligence fit within the strategic management system of the firm?
What are the measurable
"bottom line" benefits for managers and their organizations?
The Chinese military strategist,
Sun Tzu, emphasized the need for SAI: "Now the reason the enlightened
prince and the wise general conquer the enemy whenever they move, and their
achievements surpass those of ordinary men, is foreknowledge".
The upside of successfully
predicting a competitor's future plans are apparent; as are the consequences of
making business decisions based on information that is faulty.
Strategic Advancement of
Intelligence is usually composed of five major areas of endeavour, and is
performed under three main approaches in the SAI framework:
· assessment of strategies
· competitor perceptions
· effectiveness of current operations
· competitor capabilities
· long-term market prospects
Strategic
intelligence is concerned mainly with
competitor analysis or gaining an understanding of a competitor's future goals,
current strategy, assumptions held about itself and the industry, and
capabilities -- diagnostic components. Intelligence about the firm's major
customers, suppliers and partners (in marketing or research and development
alliances) is often also of strategic value.
Tactical
intelligence is generally operational
and on a smaller-scale, not so centered on being predictive. Tactical issues
include competitors' terms of sale, their price policies and the plans they have
for changing the way in which they differentiate one or more of their products
from yours. Middle-level marketing and sales managers’ number among some of the
main users of tactical intelligence. They want to know how to win the day,
today.
Counter intelligence is defending company secrets. Every firm has competitors as
interested in knowing rival's plans as it is in knowing theirs, maybe even more
so. Often, this area of endeavour will involve security and information
technology, but others are often overlooked, such as hiring and firing
strategies, to contain competitor opportunities within the firm.
Strategic Advancement of
Intelligence is the determination of solutions to these principle factors and
determinants of ongoing competitive advantage:
·
What is the basis of competition
·
Where the firm competes
·
Who does the competitor compete
against
·
How does the firm compete
SAI
is focused on decision making
Seldom do people realize that
business, just like life is merely a series of decisions. And global firms have
a growing need for the necessary information on which to base decisions
concerning the conduct and development of each of their firm's strategic
objectives, and the protection of their organizations against threats from
their competitors.
Purpose
& Role of Intelligence in Business
Intelligence is a process as well
as a product -- an analytical process that transforms tumultuously gathered
competitor and market information into actionable knowledge about competitors' capabilities, intentions, performance, and position; as
well as the final product of that process.
The focus of market research
tends to be on the problems associated with the profitable marketing of
a firm's products and services. The scope of Strategic Advancement of
Intelligence is far broader. Strategic Advancement of Intelligence is a
value-added concept that layers over the top of business development, market
research and strategic planning.
The research objectives of a
Strategic Advancement of Intelligence project will often involve issues such
as: the manufacturing capabilities of the competitor; analysis of alliances
and/or joint ventures entered into by competitors; the competitor's future
plans and strategies for specific markets, or product lines; reasons behind
changes in the corporate or business unit strategy, et cetera.
In today's global enterprise, SAI
happens at two levels -- corporate and business unit. Corporate strategy
concerns two different questions: what businesses the corporation should be in
and how the corporate office should manage the array of business units. And,
competitive strategy is concerned with how to create competitive advantage in
each of the businesses in which a company competes based upon core
competencies.
The Cycle
of Strategic Advancement of Intelligence
The SAI describes the
intelligence cycle as "the process by which raw information is acquired,
gathered, transmitted, evaluated, analyzed and made available as finished
intelligence for policymakers to use in decision-making and action." There
are five steps which constitute this cycle:
· planning and direction
· collection and research
· processing and storage
· analysis and production
· dissemination and delivery
There are seven questions to be
answered prior to making investment decisions in SAI:
· What do we need to know?
· What do we already know?
· Why do we need to know it?
· When do we need to know it?
· What will we do with the intelligence once we have it?
· What will it cost to get it?
· What could it cost not to get it?
SAI's
Final Product
The product of the intelligence cycle
is evaluated information. It is finished intelligence, packaged in a format
appropriate as much to the intelligence itself, as it is to the customer for
the intelligence, the decision-maker.
In practice, the intelligence
product is unlikely to be created from perfect input. We cannot truly and
accurately predict the future until events have already taken place and it's
too late. The firm finds itself in a position where it can only react to the
competitor's move; it has lost the advantage it might have had if the right
intelligence had been available earlier. So, although we can't know for certain
the minutiae associated with exact details, we can discover plans and
roughly-hewn strategies.
SAI's
real value is to provide managers with the organizational tool to learn what
the competitor will do, not what the competitor has already done.
Ethics and ethical behaviour are
concerns here and since the area is usually perceived as positive to a
company's reputation and competitiveness, it would not be useful for a firm to
undertake its intelligence activities without regard to ethical or legal
considerations. Everything a firm needs to know about the competition can be
obtained by legally available means. The cost of stepping over the line -- into
the black -- is far too severe, and unnecessary.
What are the bottom line benefits
of SAI?
Improved market knowledge, improved cross-functional relationships in
the organization, greater confidence in making strategic plans, and improvements
in product quality versus the competition.
In short, better business
performance through doing things better.
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