Competitive intelligence and analysis is often considered the domain of the largest companies that can afford outside consultants or a department dedicated to that task. In my career I have run one such organization in a Fortune 500 business and earlier, worked in the function at IBM, in a department numbering well over 100 people.
However, competitive intelligence is just as important for the small and medium-sized business. Understanding your competitors and being ready for their actions is part of every executive’s job in the smaller business. Often it is the marketing function that takes the lead on creating the discussion and developing whatever documentation is required. Following these simple steps will put you in a good position to be aware and react to competitive actions and avoid “business blind spots.”
- Know who your competitors are. It’s always good to have a discussion about competitors in your strategic planning process. Bring in information from the sales team, as they will be the first to notice shifts or new entrants. Recognize also that all competitors are not created equal; some will operate in the exact customer targets you have and other may not. Potential new entrants are also worthy of discussion.
- Create an easy depository to gather competitive intelligence. In strict military-style intelligence systems, gathering and analysis of intelligence are done by two different groups. In practice in a smaller company, creating a place where even the smallest bit of data can be reported and stored up for later analysis can be very helpful. Something as simple as a specific email where items can be stored and later searched by competitor and analyses may be useful.
- Keep your SWOT analysis up to date. Going through the exercise to create and maintain SWOT analyses is worth the effort in most situations. Limit the real analysis to your core competitors if it the task seems onerous. Here, the process and sharing of information is as important as the end product.
- Give your sales teams the data they need. Giving your sales teams the competitive pricing and product information they ask for and keeping it current is a bit of work, but it is high-value and worth the effort you put in. It also creates a baseline of information gathering, much of which is done by your feet on the street sales folks. Rewarding them with good analysis they can use in their day-to-day sales calls completes the cycle and motivates them to collect more.
- Watch out for business blind spots. Brainstorm the actions your competitors could take that would materially affect your business. Detail who the new power player entrants to your markets may be. Determine the ways you would know those actions were in progress and set up monitors for them. Set out in your strategic plan how you might counter such actions.
There are many books and articles written about this topic that can be used as learning tools and further study on how to make it happen. While the typical SMB can’t devote huge amounts of time and effort to CI, to not address it at all creates a risk you don’t need to have. If you implement these steps, you’ll be well on your way to properly covering the competitive bases.
What competitive intelligence do you routinely gather? Have you done any real analysis with it?
You can connect with Eric on LinkedIn: www.linkedin.com/in/ericlundbohm/
Follow his updates on Twitter @lundbohm