The Power of Competitive Intelligence

I recently met a woman who has become a strategic leader in her company by creating a very practically-oriented competitive intelligence program. She started at the grass roots level, doing primary research in new markets that her company was trying to penetrate. Over time, her team has grown and her profile has risen to the point where she is leading monthly discussions of strategic challenges with the executive committee. Her information about the marketplace is so powerful that it has earned her a seat at the senior management table.

As I spoke with her, I was reminded of one of Peter Drucker’s frequent statements—the only information that really matters comes from outside the corporation (see Ch. 3 of Managing in the Next Society). Like many of his ideas, it’s deceiving in its simplicity. It’s actually a revolutionary statement, challenging our concept of management information.

Today’s Chief Information Officer manages “information technology” that is almost 100% focused on internal information. While we don’t want to eliminate this valuable source of information, it is ultimately market movements, technological changes, evolving customer needs, and competitive environments that are critical in determining the fate of most companies. External information is the best way to ride, rather than be drowned by the waves of change in your environment.

Spend some time creating a competitive information discipline. Think about the relative investment. What do you think the ROI is on the small competitive information effort led by our contact above versus the return on all the information systems at her company? What would the return be to your company’s results (and maybe your career!) if you were to increase your understanding of your market?

-Mary Adams – 2006