Use Rivalry to Spur Innovation & Competitive Intelligence Sharing

In a recent McKinsey Quarterly, Mark Little, head of General Electric’s Global Research Group described how GE uses rivalry to stimulate innovation. I think these practices help GE be the powerhouse in the many fields where it is a market leader. Rivalry can mean outright competition—a zero-sum contest in which two individuals or teams go head-to-head and one is declared the winner at the expense of the other. But in the case of GE, rivalry is linked to a second notion, called paragon which means comparison. The motivation behind collaboration often is rivalry as two or more teams compete to develop the best product.

Scientists are motivated a lot like anyone else in that they want to be the best: yes, they’re competitive! Due to my love of aviation, my favorite example cited was the GE90, the large, high-thrust engine developed in the 1990s for the Boeing 777, which was developed by two independent teams. While one team won the competition, the other was assigned to challenge and push the winning team. While this pushing process made the teams uncomfortable, it made the GE90 a better engine and helped advance product development.

In the competitive intelligence field, I think of wargaming as a similar exercise where members of each team collaborate and role play as if they were specific competitors, so there is a healthy rivalry among the teams. However, the goal overall in a war game is to help your company be more competitive. More specifically the goal might be to prepare for a competitor’s new product launch, so it isn’t just the competitors who are represented by a team. One team might represent the marketplace which might include customer’s reactions and regulatory hurdles, for example.

Another example where rivalry works is in sales intelligence, when you reward individual sales people for being the best competition detective. Winners might share information around a new competitor entering your company’s space; a significant change in a competitor’s management team; how a team achieved a win back against a key competitor; new innovation in the marketplace; or how to win sales in spite of regulatory constraints. This is fun since most sales people like publicity and you can lay it on thick through your company’s communication channels: sales rallies, sales teleconference calls, complimentary write ups in the company wiki/newsletter or intranet and a handwritten letter to the sales person’s boss and others like the VP of Sales! While your reward system will never compete with a sales person’s commission, this publicity can. This playful rivalry will only grow over time if you figure out different ways to let Sales compete and continue to publicize your thank-you to the best competition detectives.

The real learning is you can use healthy rivalry to stimulate various behaviors since most people are naturally competitive and want to be the best. You need to figure out how best to motivate individuals to reach your company’s goals whether it’s product innovation, competitive intelligence or sales intelligence, the examples cited here. Depending on an individual’s personality type, this healthy rivalry might be fun or it might make them squirm a bit.

In the spirit of cooperative intelligence, here is an article on sales intelligence for your reading pleasure.

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Read Competitive Intelligence Advantage by Seena Sharp!

In the spirit of cooperative intelligence here is my ***** Amazon review for Seena Sharp‘s book, Competitive Intelligence Advantage where she provides incredible wisdom around the practice of competitive intelligence and draws upon her wisdom from over 30 years experience.

Seena Sharp

Seena defines competitive intelligence (CI), an unfortunate word combination which is why I believe it’s made such poor inroads as a commonly practiced and understood discipline. There are relatively few CI degree programs globally and many schools, including leading MBA programs don’t include much CI instruction in their curriculum.

Executives like most people misunderstand CI and often focus on monitoring competitors, a subset of competitive intelligence which should include a robust external dive into all the factors which can affect your company’s success — starting with your customers. Too many executives claim to know what customers want better than the customer, and don’t listen or query. While customers can’t always articulate their needs using your company’s products, it’s up to you to figure out and develop products or services that will solve customer’s problems in these changing times. In this vein, I loved Amazon’s Jeff Bezos’ attitude, “Figure out what they (customers) want and figure out a way to do it.”

Let’s face it you want to sell more to your customers and grow your customer base. If you can learn enough to think like your customer, and recognize market changes and develop opportunities to meet or exceed your customer’s needs, you will maintain a competitive advantage. But if you just look into the rear view mirror at your competitors and ignore looking forward and improving your customer’s experience with your products and services, you will lose market share.

Seena correctly defines competitive intelligence to include analysis of customers/prospects, buyers, suppliers, distributors/channel, technology, culture, regulation, demographics, the economy, substitutes, other industries and competitors.

The book is chock full of examples and case studies on the benefits of using CI, including details supporting each of the components above.

Another point Sharp emphasizes is the need to re-examine our assumptions in these changing times. To make this point she quotes Will Rogers, “it ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” Likewise, when examining competitors, consider “what they know that you don’t” to uncover new markets, applications and customer niches.

Remember that your competitor’s focus may be different from yours. Their priorities and strategy may be different from yours and they also make mistakes, so be careful what practices you adopt from them.

Seena also gives tippers on starting a CI initiative in your company. One of my favorite practices she recommends is: re-evaluate what you “know” every year: question conventional wisdom and the culture behind “this is the way we have always done it.” Another is to use customer complaints as an opportunity.

In the realm of CI, Sharp focuses on gathering “need to know” rather than “nice to know.” In the later chapters of the book, Seena focuses on how to collect CI, ranging from open sources all the way to identifying and querying people sources for collection.

I believe that the quality of your answers is directly related to the quality of your questions and CI people need to be persistent in questioning to get at what decision-makers really need. Sharp provides lists of questions for readers starting with good questions to ask about competitors, but also relevant questions to ask by categories like “Tracking Change” and my favorite list on page 163 “Questions a Company Should be Asking Regularly.” This list is provocative and gets the reader to reach out for people, relevant information from many sources and question anything that’s new or looks odd. Answer the questions on that list, and you will eliminate nasty surprises!

CI only produces good news–even when the news is bad and avoids the cost of making ill informed decisions and nasty surprises. In the new world economy can you afford not to conduct CI before making pivotal decisions? What is the cost of NOT having the necessary intelligence for your important decisions? How much does it cost to make a blunder in the marketplace?

Read Seena Sharp’s book and follow her advice and you will improve your company’s competitive advantage!

Competitive Intelligence: Remain Ethical & Avoid Deception

Last month I was interviewed by Adam Sutton of MarketingSherpa, and in the spirit of cooperative intelligence I am going into detail on each of the 5 tactics we discussed to improve competitive intelligence collection. This week I cover the last tactic. For the full article you need to subscribe to MarketingSherpa.

Tactic #5: Remain ethical and avoid deception

Make sure anyone you use to collect information is operating under the same ethical standards as held by your company. If you need help figuring out what your ethical standard should be, check out the Society of Competitive Intelligence Professional’s (SCIP’s) website for its code of ethics.  Most associations have a code of ethics and often your industry or your company will have ethical guidelines. I also like the Association of Independent Information Professional’s (AIIP’s) code of ethics.

As a consultant I am sensitive to the topic of ethics since there is such a variance among my clients. Some industries are more conservative than others. Countries have very different ethical standards. Some clients have the attitude of “Just get the information for us, I don’t care how!” Others go as far as to have me sign on to their company ethical standards.

Don’t expect consultants to be unethical to collect for your company. You wouldn’t ask your employees to be unethical, and consultants when working for you are an extension of your company. It just isn’t worth your reputation to be unethical, and it doesn’t feel good to me to be asked to unethical. I have had companies ask me to attend trade shows and sign up as the employee of a large company. That’s unethical and also unnecessary. People will talk and share at trade shows even if you are a direct competitor. Of course, they’ll share even more with a trained collection consultant who is not a competitor.

More companies have written ethics statements these days, although I don’t find that companies are any more ethical today than they were 25 years ago when I started in this field. I find that having an honest discussion around ethics at the proposal stage is helpful so I can decide if my ethics and the company’s are similar. I find that each case is a little different, and you need to arrive at what feels right with each customer and each collection project, but that having ethical guidelines is helpful. Ultimately it’s your conscience that will guide your behavior and ethics is part of that.

BTW, SCIP’s Competitive Intelligence Foundation published a book on ethics Navigating the Gray Zone which will give you a lot of tippers around ethical behavior and how companies have developed ethics policies over the years. Here is a short article I wrote on ethics, Ethics: The Cooperative Angle.

Boost Competitive Intelligence Effectiveness through Databases

Last month I blogged about “5 Tactics to Research Your Marketplace using Competitive Intelligence Skills” originally published by Adam Sutton of MarketingSherpa.  As promised, I am focusing on each tactic. This week’s is #4.
Tactic #4 Build an information database
I look at building two databases: one as a repository of data that you gather on the competitive environment either through daily monitoring or analytical reports which can include material that is externally generated such competitor data, industry reports, relevant articles, regulatory trends, technology trends, distribution channel news, financial reports and relevant economic news as well as internal reports such as competitor profiles, win loss analysis, trade show analysis, product plans, strategic plans, technical assessments, wargame results, scenario planning results…all the material that you need at your finger tips for those quick turnaround projects as well as to detect patterns in the marketplace that make you pause, stand back and say “ah ha, something is up” or “something doesn’t look right”.
When selecting a software solution, you need to keep in mind the technology your company is already using, and piggyback off something that already exists, such as salesforce.com to get the scoop from Sales. Perhaps PR uses software for delivery of the news, which you can extend off of. Perhaps your industry relations folks get financial reports from Thomson, which you can build from. Get a grasp of what’s already out there and build rapport with your IT people since you will need to work closely with them for installation, depending on the size and complexity of your software solution. There are competitive intelligence software providers you might consider: I have a partial list here.
There are a few things I look for when building an information database for competitive intelligence other that installation and cost!
1. How easy is it to browse and find what you’re looking for?
2. How easy is it to update the system and refresh the data? How much time and expense do you need to factor in for updating? Many people underestimate both, so the system becomes outdated quickly and loses credibility with users for obvious reasons.
3. Is there a process to delete data when it becomes outdated?
4. How will the system maintained?
5. What are your security considerations around a software system?
6. Who will you allow to make changes to the system?
7. How will you control the integrity of the data?
8. How will you encourage people to make contributions?
A contact database is the second type of database and is crucial for competitive intelligence personnel and anyone who does research. This database contains contacts both internal and external to your company who are great sources of information about your industry, the marketplace, the competition… Mine is organized by skill set, and how and where I met each person. Perhaps your company’s directory lets you do this: you still need to connect with external contacts continuously to keep from being blindsided.
Quick access to people and information greatly speeds up your research timeline! I also keep track of my projects through my contact database, and specific topics my clients have queried about. That way when I find cool stuff, I can quickly sort those people who are interested in this topic, and communicate with them directly. Clients appreciate this since I don’t send them irrelevant stuff, but rather build on what they’ve asked for in the past. This promotes cooperative intelligence since it’s cooperative communication. I like to use ACT! http://www.act.com/ for my contact database although there are plenty of options: just pick one and learn how to use it!
Social media has opened up ways to connect and be found. I also use Twitter’s Tweetdeck to sort comments by the category where they’re an expert, which I perceive as another form of connection. LinkedIn groups are another great source of connections by subject matter expertise. You can use LinkedIn’s advanced search option.
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