You are on page 1of 43

Technology and Competitive Intelligence

Competitive Intelligence

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
1
Technology and Competitive Intelligence

Competitive Intelligence – A hot Theme!

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
2
Technology and Competitive Intelligence

What is Competitive Intelligence?

• CI is external Information, about your competitors


that is gathered to help you make internal decisions.

• If possible, CI-Information is best collected, analyzed,


and disseminated by personnel in the CI-Department.
However, such a department is not required CI can be
useful to and performed by everyone.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
3
Technology and Competitive Intelligence

Of what use is Competitive Intelligence?

• Detect potential threats to your business.

• Anticipate competitors action´s – decrease number


of surprises

• Discover new opportunities, such as potential customers


and new business ventures

• Monitor the market in which your company competes


to adapt current business practices

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
4
Technology and Competitive Intelligence

Ethical Issues

• Is competitive intelligence spying? Is it unethical, or


even illegal?

• No. All the information that you require to obtain an


analysis of another company can be found from public
sources. There shouldn’t be any sneaking around,
spying, or poking through garbage cans. You may
however, need some creative ideas and do a lot of
digging to get the information.

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
5
Technology and Competitive Intelligence

Competitive Intelligence is legal!

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
6
Technology and Competitive Intelligence

Competitive Intelligence is based on a systematically Data-Collection

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
7
Technology and Competitive Intelligence

How to begin

• First, every business should have a specific person or department


responsible for handling competitive intelligence. These people
should be accountable to top management.
(Kahaner, Larry, Competitive Intelligence, KANE Associates International, Inc., 1996)

• The second required step is to determine the type of information


that is to be gathered
(If a competitor is moving into a new field of business, a SWOT analysis is required)

• The third step is to use the gathered information to the further


business strategy.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
8
Technology and Competitive Intelligence

Sources of Information

• There are two main sources of information on your competitors:


primary information and secondary information.

• Primary information is directly from the source (i.e., competitor).

• Secondary information is published by other sources that may have


been altered in some way.

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
9
Technology and Competitive Intelligence

Where are the Sources for CI?

Internet Internet

Analysts Secon-
Annual Primary Speeche
‘ dary Books
Reports Sources s
Reports Sources

Govern- News- Edited


Financia
mental papers / TV/
l
Docu- Maga- Radio
Reports
ments zines Program

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
10
Technology and Competitive Intelligence

Examples of Information Sources


• Some primary information sources:
- Personal or public interviews with competitors’ management or
employees
- Speeches
- Annual reports and other information produced by competing
firms, including online information
- Government documents
- Trade shows
- Patent searches (show what products competitors may be
planning to introduce)

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
11
Technology and Competitive Intelligence

Examples of Information Sources

• Some secondary information sources:


- Newspaper and magazine articles
- Industry reports
- Books
- Edited television and radio interviews
- Industry leaders’ opinions

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
12
Technology and Competitive Intelligence

Using Information Sources


• Remember to always use more than one source. All secondary
information should be checked against primary information to
decrease the possible bias error. Single sources of information
must be confirmed by at least one other source.

• Accurate information is key, because important business decisions


may rest on this competitive intelligence information. Every
precaution must be taken to ensure it is correct.

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
13
Technology and Competitive Intelligence

Using the Internet

• The Internet is a valuable tool that should be used in any


competitive intelligence efforts.

• Where to look on the Internet:


– Competitors’ home page: the best place to start
• Read your competitors’ mission statement
• Observe their web strategy and any innovations they have
implemented
• Use the contact information on their sites, ask them the
questions you need to know, their help lines can provide
useful information

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
14
Technology and Competitive Intelligence

Using the Internet

– Search engines
Search for profiles on top managers and competitors

– Discussion groups
These groups are an excellent place to gather information on
your competitors, especially since the information may be
from your competitors customers

– Databases

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
15
Technology and Competitive Intelligence

Analysis

• The collected information must be transformed into a useful report.


• One way of analyzing all the information is to review it through a
SWOT (Strengths, Weaknesses, Opportunities, Threats) Analysis
• Segment the information to make educated assumptions about the
strengths, weaknesses, opportunities, and threats of the competing
firm.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
16
Technology and Competitive Intelligence

SWOT Analysis

• Ask the following questions, once the strengths, weaknesses,


opportunities and threats of the other firm, have been
determined:
– How will the firm use its strengths to take advantage of the
identified opportunities?
– How will it use its strengths to overcome its weaknesses?
– How will it minimize weaknesses to overcome threats?

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
17
Technology and Competitive Intelligence

Dissemination

• After analyzing and reviewing the information, it should be written


up in a comprehensive report.
• The report should answer any questions that were posed at the
beginning of the competitive intelligence project.
• The report should be clear and to the point; it should include all the
information gathered by the project and feature and organized
summary of what has been learned and what action should be
taken in light of that knowledge.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
18
Technology and Competitive Intelligence

Utilizing the Research

Once the information has been gathered and the report disseminated,
the next step is to make use of that information. Everything that has
been learned should be applied to your company’s current business
plan by asking the following questions:
– Is the competitor serving customers in a different way that
could be adapted to further your own business?
– Is there a changing market demand?
– What strengths does your company have, which your
competitor does not have, which you could monopolize?

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
19
Technology and Competitive Intelligence

Utilizing the Research

• By answering these questions, it should be reasonably clear what


decisions will need to be made concerning your corporate strategy.

• It is a matter of adapting and proceeding with your business as you


normally would – only now you will be far better informed and
therefore ready for the challenges ahead.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
20
Technology and Competitive Intelligence

Overview

• Competitive intelligence is useful for any business and has a


number of excellent applications.
• Any information gathered must be checked against other sources
to ensure that it is accurate and unbiased.
• Be creative when searching for information. The Internet is a
valuable source.
• The gathered information must then be organized into a useful
format, otherwise it is intelligible and of no use.

Source: Small Business Info Center


Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
21
Technology and Competitive Intelligence

Opportunities For eBusiness


•The Atlantic Canada Opportunities Agency (www.acoa.ca) has a number of
initiatives established for Atlantic businesses to improve their current
business practices, such as the Business Development Program.

•There are many academic and information resources available such as:
- Industry Canada (http://www.strategis.gc.ca/)
- Business Development Bank of Canada (http://www.bdc.ca/)
- The University of New Brunswick (www.unbsj.ca)
-The Electronic Commerce Centre in Saint John (www.ec-centre.com)
- eNB (www.eNB.ca).
- e)Merge (http://www.emergewithus.com/)
- SME World (http://www.smeworld.net/)
Aligning your business with the right players in the industry, and those who
have the best information will be of great benefit, will ensure that your
business adopts the best practices to leverage all the advantages that are
available.
Source: Small Business Info Center
Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
22
Technology and Competitive Intelligence

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
23
Technology and Competitive Intelligence

Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
24
Technology and Competitive Intelligence

SCIP: Society of Competitive Intelligence Professionals

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
25
Technology and Competitive Intelligence

Echelon – Big Brother is watching you! (1)

• In the greatest surveillance effort ever established, the US


National Security Agency (NSA) has created a global spy
system, codename ECHELON, which captures and analyzes
virtually every phone call, fax, email and telex message sent
anywhere in the world.

• ECHELON is controlled by the NSA and is operated in


conjunction with the Government Communications Head
Quarters (GCHQ) of England, the Communications Security
Establishment (CSE) of Canada, the Australian Defense
Security Directorate (DSD), and the General Communications
Security Bureau (GCSB) of New Zealand.

Source: http://fly.hiwaay.net/~pspoole/echelon.html
Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
26
Technology and Competitive Intelligence

Echelon – Big Brother is watching you! (2)

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
27
Technology and Competitive Intelligence

Echelon – Big Brother is watching you! (3)

• The ECHELON system is fairly simple in design: position intercept


stations all over the world to capture all satellite, microwave,
cellular and fiber-optic communications traffic, and then process
this information through the massive computer capabilities of the
NSA, including advanced voice recognition and optical character
recognition (OCR) programs, and look for code words or phrases
(known as the ECHELON “Dictionary”) that will prompt the
computers to flag the message for recording and transcribing
for future analysis.

• Intelligence analysts at each of the respective “listening stations”


maintain separate keyword lists for them to analyze any
conversation or document flagged by the system, which is then
forwarded to the respective intelligence agency headquarters that
requested the intercept.
Source: http://fly.hiwaay.net/~pspoole/echelon.html
Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
28
Technology and Competitive Intelligence

Echelon – Big Brother is watching you! (4)


US Spy Satellites in Current Use

Satellite No. Orbit Manufacturer Purpose


5-inch resolution spy
Advanced KH-11 3 200 miles Lockheed Martin
photographs
La Crosse Radar 3 to 10-foot resolution
2 200-400 miles Lockheed Martin
Imaging spy photographs
Orion/Vortex 3 22,300 miles TRW Telecom surveillance
Surveillance of cellular
Trumpet 2 200-22,300 miles Boeing
phones
Parsae 3 600 miles TRW Ocean surveillance
Satellite Data Systems 2 200-22,300 miles Hughes Data Relay
Defense Support
4+ 22,300 miles TRW/Aerojet Missile early warning
Program
Defense Meteorological Meteorology, nuclear
2 500 miles Lockheed Martin
Support Program blast detection

Source: MSNBC
Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
29
Technology and Competitive Intelligence

Echelon – Big Brother is watching you! (5)


Consequences of the Industrial Espionage

• Siemens lost an order with a volume of billion dollars in South-


Korean over the Procuring of an ICE-Trail-system. The reason was
that France intercepted the German Price-demand in the Internet
and made a cheaper offer with their TGV-System.

• France lost a Saudi-Arabian Order with a volume of more than ten


billion dollars over Armament and Airbus-Plans. The US-Armament-
Company McDonnell Douglas got the Order instead.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
30
Technology and Competitive Intelligence

Does early Enlightenment create Future-Knowledge?

• Companies does not exist independently from their


Environment. They are Part of the whole System above.

• Changed Situations in the Company's Environment have


direct Consequences on the Activities of the Company

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
31
Technology and Competitive Intelligence

Surprises causes Mistakes in the Resources Allocation


of the Companies

• Changes in the Environment of the Company have to be


earliest identified and possible Consequences have to be
analysed to avoid the Surprise and the following Mistakes.

• The Importance of identifying and analysing Future-


Developments is an established Theme in Research and
Science.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
32
Technology and Competitive Intelligence

What is the Meaning of early Enlightenment?

• Early Enlightenment is important because it generates


Information about Past and Present. Based on this
accumulated Information and based on their Analysation
and Interpretation it is possible to asses future
Developments.

• But even though a concrete Prediction of future


Developments is not possible.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
33
Technology and Competitive Intelligence

What is NOT the Meaning of early Enlightenment?

• The Goal of Early Enlightenment is not the Attainment of


Future-Knowledge in the meaning of getting all Information
about future Developments, global Systems or future
Behaviours of the Actors in the task-specific Environment-
Segments.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
34
Technology and Competitive Intelligence

Different Phases of early Enlightenment

Data-
Survey of the Analyzing and Allocation
Data-
Information- Evaluation of
Collection
Needs of the Information
Information

Storing of the Information and Data

Feedback

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
35
Technology and Competitive Intelligence

Microsoft (Bill Gates) + the Internet I

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
36
Technology and Competitive Intelligence

Microsoft (Bill Gates) + the Internet II

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
37
Technology and Competitive Intelligence

Microsoft (Bill Gates) + the Internet III

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
38
Technology and Competitive Intelligence

Microsoft (Bill Gates) + the Internet IV

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
39
Technology and Competitive Intelligence

Understand the Future: Al Gore I

• In the end of the 80th a Senator from Tennessee, Al Gore,


started to swear on the Information Highway.

• He did not really know, what he was talking about, but all
the scientists, which want to order Money for Research from him,
demonstrated impressing things with their Computers.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
40
Technology and Competitive Intelligence

Understand the Future: Al Gore II

• For instance the Scientists simulated the Climate of the Earth.

• And much more important was the fact:


Distances played no Rule!

• They just connected their Computers on the Table with the


Mainframe thousands of miles away. This happened over an
unknown Network – the Internet.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
41
Technology and Competitive Intelligence

Understand the Future: Al Gore III

• That inspired Gore:

If Scientists work this way, why not everyone?

• His father, a politician as well, has shown commitment to


widen the Highway to integrate isolated Areas.

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
42
Technology and Competitive Intelligence

What is the difference between Bill Gates and al Gore? (anno 1990)

• Why does a Man like Bill Gate speak the whole time about
“Information at your fingertips” in the beginning of the
90th and oversleep the Internet-Revolution….

…while a Senator from Tennessee is able to assess the


Potential of the Internet?

Source: ETH Zürich Copyright © Prof. Dr.-Ing. Savas Tumis

Strategic IT Management
Prof. Dr.-Ing. Savas Tumis
Technology and Innovation
43