What businesses should know about competitive intelligence?
Collecting and analyzing information from the market sources pertaining to the strength and weakness of the competitors in an ethical and legal manner to enhance the business and to take better strategic decisions can be termed as ‘Competitive Intelligence’.
Do all companies need competitive intelligence?
Companies adopt competitive intelligence to alert the management about the impending threats and opportunities thus empowering them to face and tackle the challenges head on. Any company could undertake competitive intelligence for any one or all of the following underlined reasons
- Execution and implementation of well informed decisions
- For companies wanting to understand the country’s zoning rules
- Companies desiring to gain in depth knowledge about their competitors
Most of the big corporate organizations generally have their own intelligence department while the small business houses conduct competitive intelligence on temporary basis by collecting information through internal and external sources such as meeting customers directly, attending trade shows and conferences, or obtaining information from the internet.
Categorization of competitive intelligence
There is a primary difference between competitive intelligence and industrial or corporate intelligence. Companies through adoption of unethical and illegal means to ascertain competitive edge use the latter.
The activities undertaken in competitive intelligence can be categorized as
Tactical competitive intelligence is short term with primary focus on issues such as market share and revenue. Strategic competitive intelligence is undertaken by companies to tackle long-term issues such as risks, opportunities, and threats facing the organizations.
Is competitive intelligence same as business intelligence and market research
The term ‘Competitive Intelligence’ is often confused with business intelligence and market research. Market research involves gathering and analysis of customer centric information through collection of statistical data and large-scale surveys.
Generally, the two disciplines of market research and competitive intelligence go hand in hand in most organizations, as many market research departments are responsible for competitive intelligence.
Business intelligence on the other hand is predominantly more of a quantitative exercise involving in depth analysis of business statistics through collection, storing, and analysis of business data.
Many a time competitive intelligence is used to obtain an insight into difficult statistics for business intelligence. Thus, in short they are interrelated disciplines useful to senior management for taking fruitful decisions.