2013 in review

The WordPress.com stats helper monkeys prepared a 2013 annual report for this blog.

Here’s an excerpt:

A San Francisco cable car holds 60 people. This blog was viewed about 2,900 times in 2013. If it were a cable car, it would take about 48 trips to carry that many people.

Click here to see the complete report.


Where you stand depends on where you sit

December 19, 2013

 

One of the most difficult things to accept in competitive intelligence is that just because you think you understand something doesn’t make it so. Specifically I’m talking about understanding and then predicting actions of competitors.

It is absolutely vital to keep in mind that your competitors not only do not necessarily see the world the way you do, they almost certainly do not use the same kind of metrics in making decisions that you do. This makes it very difficult for you, acting as your own analyst, to understand and then predict your competitors’ behavior without significant digging.

A recent article in The Economist[1] referred to a study that highlights just how different individual enterprises can view the world. In its discussion about carbon pricing, the article noted that the study about how major enterprises used carbon pricing in planning capital projects was particularly intriguing. The prices noted ranged from $6.70 per ton of carbon dioxide to over $34 per ton (or over 5 times as high).  The article concluded, “[t]hese prices change behaviour.”

They certainly do: the difference in pricing by two companies looking at capital planning in the same competitive environment will result in two different decisions. So always take care to determine your competitor’s perspective before predicting their actions.


[1] “Carbon Copy”, The Economist, December 14, 2013, 70.


How often?

December 12, 2013

An article in The Economist Technology Quarterly[1] discussed the continuing use of magnetic tape for data storage. It included a discussion of the so-called “storage hierarchy”. That analysis divides data that a business holds into three categories:

  •   Hot data – data which must be available for immediate access.
  •   Lukewarm data – data that people need to access frequently but not instantaneously.
  •   Cold data – data which may be needed in the future, but which can be kept in long-term storage.

An interesting point was that a 2008 study has found that, in general, 90% of an organization’s data becomes “cold” after only a couple of months.

So what does that mean for competitive intelligence?

Look at your intelligence on your competitors, your competitive environment, your customers, your suppliers, that is, on your entire corporate environment. How current is that intelligence? Using the above analogy, after some period of time, say 90-180 days, your data, and therefore the conclusions which you have based on that data, and the actions you have planned to take based on those analyses, are at least “cold”.

The lesson is that collecting CI and using CI is not a static process. It is a dynamic world and your CI process has to be equally dynamic. That means the days of the “let’s update a profile of our competitors for the annual strategic planning retreat in March” and then leaving those profiles untouched until next year should be over. (Actually they should never have happened).

Word to the wise.


[1] “Magnetic tape to the rescue”, Nov. 30, 2013, http://www.economist.com/news/technology-quarterly/21590758-information-storage-60-year-old-technology-offers-solution-modern .


Strategic Plan(ning)?

December 5, 2013

 I was struck by the caption on a recent book review in The Economist, “Why a Strategy is not a Plan”[1]. It highlights a major issue (a nice word for problem) in business strategic planning, that is, that the end of the process is too often the production of plan, rather than the initiation of an ongoing strategy process.

A real strategy should not merely end with a “plan”. The strategy process should include in it an ongoing analysis of possible future events and your firm’s likely response. A plan which simply says we will do this, then this, then this is not a plan: it is driving directions.

More is needed. Take for example, the invasion of Normandy during World War II, one of the most complex projects ever undertaken. The initial strategy, at least one of them, was to drive as many men and as much equipment off the beaches in as short a period of time as possible. That was to secure the beachhead before the Germans could respond.

To that end there are many unique pieces of mobile equipment were designed and built to overcome anticipated defenses on each of the beaches. One was that certain vehicles carried logs to fill in ditches prepared by the Germans. However some units involved landed at other beaches, rendering their equipment useless. But they still knew the strategy. When the equipment was not useful, the soldiers changed their tactics.

That raises the question of the role of competitive intelligence in strategic planning (as opposed to plans). All too often competitive intelligence is relegated to a relatively minor role, such as providing a summary of the current structure of the market and some high-level background on competitors. While that is useful, more is possible and certainly more CI is needed.

Ideally CI should also be providing assistance, whether through scenario playing, war games, or otherwise, on how competitors may react to the strategy under development, and how your firm should consider responding to that response. That is a very powerful and important role – it enables those charged with executing strategy to be able to adapt to the unanticipated events they will face. A strategy made to support the launch of a new product in the second quarter, without considering the possibility that a competitor may launch a similar product during the first quarter, or that a competitor, having seen your product launch may launch a competing product price 15% below yours, is not much of a strategy. Good CI, on a regular basis, supports good strategic management, as well as planning.


[1]www.economist.com/category/print-sections/books-and-arts