Capture Competitive Intelligence from Sales: Switching Cost Analysis

How do you extract precious competitor and customer tidbits from Sales? The first rule with Sales is “You must give what they need in order to get.” Giving is one of the key principles of cooperative intelligence. It’s also helpful if you put yourself in Sales’ shoes. I was lucky in that I sold for a few years before I started our competitive intelligence initiative at Bell Atlantic, now part of Verizon. Thus I had credibility since I knew the challenges that Sales faced first-hand.

However, you who have no sales experience, can gain insight by accompanying Sales on customer calls. Other ways to connect with Sales include listening in on their challenges through Sales conference calls, attending Sales rallies, and perhaps getting on the agenda to speak at such a rally. It’s great if you can connect with Sales just as they’re hired by conducting some competitive intelligence training as part of Sales orientation. That way you can meet Sales people who may have come from the competition.

You gain sales intelligence and learn why customers do or don’t buy through win loss analysis. However, even though you include Sales in win loss, they may feel threatened when someone else calls their customer, treading on their precious relationship.


One tool that been very popular with Sales forces over the years is “Switching Cost Analysis.” The goal is to help retain your customers! As a competitive intelligence professional, you can help Sales boost their creativity in using this tool.

Often the purchase price for your product is more expensive than the competitor’s. However, once you identify all the hidden costs, the cost for the customer to switch to the competitor’s product might be more expensive than if they stayed with your company’s solution.

When I sold telecommunications systems, for example, my competitors only included the cost of the phone equipment and conveniently left out all the network fees required to make their phone system work. I included that cost. They also downplayed the cost and time to train people how to use new technology, not just the user’s but also the customer’s installation and maintenance people. You can help your sales force be more creative about what costs your competitor may be omitting, and perhaps cast a shadow of a doubt about the competition. If they forget to include too many costs, the customer might wonder what else the competitor is not telling them!


Next Generation Competitive Intelligence Deliverables: SCIP Webinar

This promises to be a great webinar which coincidentally illustrates cooperative intelligence practices, both cooperative communication and cooperative connection. The material Marty Palka covers will also be useful outside of the competitive intelligence profession. Anyone who provides a service will benefit from his ideas.

This Webinar is sponsored by SCIP.
“Next Generation Competitive Intelligence Deliverables ”
12:00 p.m. – 1:00 p.m. USA EST; Feb. 18, 2009
Fee: Member $95*  Non-member $195*
*A site is one computer used to view the Webinar
Register Here.   scip-webinar-archives

Next generation companies will be more collaborative with far more interactions among their customers, suppliers, employees and partners. This will mandate that competitive intelligence professionals incorporate next generation technology when creating competitive intelligence deliverables.

Through his experience at Cisco, Marty will tell you how to communicate more effectively by adding Web 2.0 technology to your communication arsenal.  He will talk about how to truly connect with people, and how to rate and assess the connection.  Through social networks, you connect with so many more people that you need to stand back and re-assess your connections periodically to concentrate on the most valuable, and to reach out to people in areas where you might be weak, such as innovation.  I like that Marty will share ideas on the other end of connection: how people assess you and your deliverables as a competitive intelligence professional.  It will be the best of both worlds: traditional and Web 2.0 connecting and communicating!

Here are key points that Marty will cover:

1) The Virtual Competitive Intelligence Professional: Locate, rank and rate experts within your organization.
2) Video: Change the process to take advantage of video’s unique attributes to deliver competitive intelligence.
3) Global: Go where the expertise is 24 hours a day.
4) Green: Right for the world and right for your business.
Metrics measure the success of Cisco’s competitive intelligence deliverables.
Quantitative: Number of hits, listeners, viewers, interactions, and actions taken. Qualitative: Recommendations, Revenue, Profitability, Setting the Industry Agenda.

Marty Palka is Chief Intelligence Analyst, (CIA), Investor Relations for Cisco Systems. He has contributed to Cisco Systems’ strategic and tactical intelligence initiatives since joining the company in 1995. Previously he was a Director and Principal Analyst at Dataquest. He has also worked at SGI, Prime Computer, and Data General. He earned his M.B.A and B.S. from Boston University.

Contact Registration:
Program content & logistics: Sandy Skipper at +1.703.739.0696 x110,
Robyn Reals at +1.703.739.0696 X107,

Learn about more SCIP events.

Learn about SCIP’s annual conference here.scip-09-chicago

Take advantage of the special Early Bird Reduced rate until the close of registration, April 12th, 2009.  All that is required is that my name, Ellen Naylor, be mentioned on the attached form which should be faxed to 703-739-2524.

Getting into Your Competitor’s Head: A Case Study

Competitive intelligence professionals often spend too much time collecting competitive data and not enough time digesting what it really means, and how it can help their managers make better decisions.  In the February McKinsey Quarterly, “Getting into Your Competitor’s Head,”  the authors (Hugh Courtney, John Horn and Jayanti Kar) discuss that in order to be more predictive you need to insert yourself into both your competitor’s company moves as well as their decision-making, which often don’t match.  In the usual McKinsey style, they supplied a great visual to get people thinking about a process to predict competitor’s moves and reactions to your moves outside of scenario planning.


This article reminded me of a company I analyzed in the glass industry.  I learned their major factory was in disrepair, as the company was investing minimally in new equipment and was just patching up the glass furnaces. They were hiring workers who spoke little English, a huge safety hazard around the extreme heat of glass production.  The company was clearly losing money in this business, and I just couldn’t understand why they stayed in the business.  The analyst community was also puzzled.

I got my answer as I listened to a quarterly earnings conference call.  One analyst queried the CEO about the failing glass business, and the CEO sadly answered, “Ah well yes, there is our glass business…sigh…” with a heavy voice full of remorse.  He was staying in the industry since his Dad had bought into it, and he wanted to keep it going.  It was an emotional decision, so I predicted that the glass business would not be for sale unless something drastic happened, like an accident at the factory which resulted in the loss of human life or stockholders complaining that this glass business was pulling down the company’s earnings and stock value.  A couple of years later, an influential stockholder wrote up his disgust about this company’s poor performing glass business and publicized it widely.  My client seized the moment and put in a bid for the glass business and I’m sure they got a good deal.

Some companies conduct an elaborate and expensive process called wargaming to get inside their competitor’s heads.  In some cases it’s warranted. In simpler cases, be creative: identify the key decision-maker’s motivation, personality style and track record through personality profiling, to predict how s/he will lead the company or react to your product launches.  There may be several decision-makers to consider depending on the company and your focus. Don’t get blindsided: sometimes market events change in a way that affects the executive’s decision-making pre-disposition due to stress or they rely on a key influencer that you hadn’t considered.

Do you have any stories to share about how you got into your competitor’s head?

Win/Loss Analysis book gives you a process to learn why you’re losing business and how to keep more of it!

Receive our 6-page Win/Loss Cheat Sheets

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Build Cooperative Trust: Learn from Millard Fuller, Habitat for Humanity Visionary

creativitycentralmariacharlie1I just had the privilege to attend my friends, Maria and Charlie Girsch’s 40th wedding anniversary celebration which started with a renewal of their vows.  Maria and Charlie are toy inventors who lead Creativity Central where they teach people how to be creative based on their 25 years of creativity with toys.  Their list of toy inventions numbers over 200!

Their celebration service was led by The Very Reverend Peter Eaton of Saint John’s Cathedral in Denver, Colorado.   He gave a stirring homily as he recounted the life of Millard Fuller, the visionary whose ideas and tireless work created Habitat for Humanity in 1976 who died on Feb. 3, 2009. How fortunate for Millard Fuller that President Jimmy Carter publicly supported Habitat in its early days which gave the organize a huge PR boost!  He has been an active volunteer in building Habitat homes and endorsing Habitat.

millardfuller-2By Habitat’s 25th anniversary, tens of thousands of people were volunteering with Habitat and more than 500,000 people were living in Habitat homes.  “Millard Fuller’s drive and relentless commitment to affordable housing captured people’s imagination and changed lives around the world,” said J. Ronald Terwilliger, chair of Habitat’s International Board of Directors. “His inspiration lives on in Habitat’s work and through its employees, volunteers, partner families and supporters.”

Today more than a million people live in Habitat built, reconstructed or revamped homes, which are in more than 100 countries. Former President Jimmy Carter said: “He (Fuller) was an inspiration to me, other members of our family and an untold number of volunteers who worked side by side under his leadership.” Former President Bill Clinton has also volunteered on Habitat projects. When he presented Fuller the Presidential Medal of Freedom in 1996, Clinton said, “I don’t think it’s an exaggeration to say that Millard Fuller has literally revolutionized the concept of philanthropy.”

Millard Fuller’s leadership of Habitat for Humanity is an example of cooperative intelligence in the non-profit world, which continues to thrive.  It is a hugely successful cooperative effort by many people to restore or build homes for the less fortunate around the globe.

In our tough economic times, leadership needs to engage in cooperative intelligence and build support systems among employees, customers and suppliers like Miller Fuller did for Habitat. Many employees feel fear, and that they’re beaten up by their company’s management to do more with less.  How will companies foster a cooperative spirit when they are struggling to survive? It is more important than ever that the remaining employees in companies feel valued and are motivated to work hard, not just to keep their jobs, but because they want to.

What steps can you take to build up your company’s cooperative intelligence “trust” fund?

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