Another look at problems with competitive intelligence (part 2)

March 31, 2015

Last week, I noted that a recent business journal article took an academic look at the business use of intelligence contrasted with governmental use[1]. That piece had four criticisms that are relevant to developing CI for your own use or with others on your business team. This week I will deal with the fourth one, and my take on all four:

The fourth is that

“[m]ost companies do not collect the correct information in the most efficient manner”.

and the recommended solution for this is the

“collection of broad range of intelligence including open source (OSINT) and human intelligence (HUMINT) through external organizations. Testing of customer facing employees with target collection campaigns.”

I have to take issue. While external organizations (such as my firm) have much more flexibility in collecting data than do our corporate counterparts, part of the significant difference between government collection of intelligence and corporate collection of CI lies in resources. That is, a team of two or three (private sector) employees (or consultants) cannot be expected to collect, maintain, and continuously analyze the vast amounts of data on a competitor or competitors that an entire team of analysts, supported by a separate team of full-time data collection professionals, in career governmental positions, can generate and maintain.

In addition, the private sector is constrained from many forms of data collection available to the government, so that they rely on a smaller range of options.

For example, signals intelligence, based on the interception of communications, is absolutely barred for the private sector, while it is available, admittedly under certain constraints, to the governmental sector.

Also, corporate policies, as well as CI ethical standards[2], may significantly limit human intelligence activities in the private sector:

  • Many businesses, properly so, limit or even forbid direct contact with competitors about certain issues including, of course, prices and pricing.
  • Some, to protect against accidental violations of this standard, even bar one-to-one communication with employees at any competitor.
  • In addition, CI ethical standards do not permit an employee of one company to collect human intelligence (via elicitation interviews) from competitors by lying about his identity or her employer.

Similar limits do not exist for the government.

Overall, the strong parallels between the governmental collection of and development of intelligence and business’ intelligence activities are increasingly diverging. After years of development, government intelligence culture, tools, analytical and communications protocols differ more from those of CI than they did 30 years ago[3]. That is because the missions, the methodology, the legal constraints, and the total resources devoted to the respective tasking has less and less symmetry (properly so, because there is a difference between losing market share and losing lives). In light of that, I expect that competitive intelligence can and should differ from governmental intelligence both in intelligence collection and analysis, and should be allowed to develop and differ without inappropriate comparisons.

[1] Edward Mozley Roche and Michael James Blaine, “The Intelligence Gap: What the Multi-National Enterprise Can Learn from Government and Military Intelligence Organizations“, Thunderbird International Business Review, Volume 57, Issue 1, pages 3–13, January/February 2015.

[2] See, e.g. The Helicon Group, “Ethical Standards”, Strategic and Competitive Intelligence Professionals, “SCIP Code of Ethics for CI Professionals”, and John J. McGonagle and Carolyn M. Vella, Proactive Intelligence – The Successful Executive’s Guide to Intelligence, Spring, 2012, Chapters 5 and 6.

[3] In the words of Eddie Wilson, “Hey! I didn’t say better, I said different”, Eddie and the Cruisers, Embassy Pictures, 1983.

Another look at problems with competitive intelligence (part 1)

March 24, 2015

A recent business journal article took an academic’s look at the business use of intelligence contrasted with that of governments. In that article, the two authors noted that

“with all this expenditure of time, money, and effort, large enterprises still are caught off-guard on an almost daily basis because they fail to anticipate critical developments in their competitive environment.”[1]

While I do not agree with all the conclusions in the article, there are four criticisms that the authors make that are relevant to developing CI for your own use or with others on your business team.

  • The first criticism is that “[the] Intelligence function is not integrated with the top levels of decision-making.” By generating intelligence for your own use, you not only to avoid the dreaded fundamental disconnect (for more on that, just search this site), you also immediately avoid this problem. As the decision-maker, you are seeking intelligence on a regular basis, whether or not you have an immediate problem. You are constantly monitoring your competition and, if possible, potential competitors, to avoid surprises. To this extent, the individual marketing director, product manager, or strategic planner has a distinct advantage over senior management: he/she is collecting and using CI the proper way, as part of decision-making, by virtue of the fact the decision-makers are developing the CI.
  • A second criticism is that “[m]anagers lack the skills and training to use intelligence effectively.”  Here, the authors point to the fact that in most large organizations, intelligence is sought only after a problem arises, and not before (an observation with which I do not agree), so that advance warnings, which they regard as a key benefit of intelligence, are the exception. As for you, having at least a partial hand in collecting the data and analyzing it, you understand how to use it effectively, including understanding the strengths and weaknesses of intelligence – all because you have helped develop it.
  • A third criticism is that “[t]here is no established career path for intelligence professionals in the [multinational enterprise].” Again, those of you who are generating your own CI do not have to worry about this rather troublesome situation. The authors are correct that in very few companies is there an established career path or trajectory for CI professionals’ advancement. To advance, generally they have to shift from CI to some related function like strategy or marketing. However, if CI is a part of your skill set, then your promotion and career opportunities are based on your performance of your primary job, whether strategy, marketing, sales, corporate development, or other. And your performance there, in my opinion, cannot fail to be enhanced by having CI as a part of your intellectual toolkit.

I will touch on a fourth criticism and give my take on the comparisons of government with the private sector next week.

[1] Edward Mozley Roche and Michael James Blaine, The Intelligence Gap: What the Multi-National Enterprise Can Learn from Government and Military Intelligence Organizations, Thunderbird International Business Review, Volume 57, Issue 1, pages 3–13, January/February 2015.

Public (?) records

March 17, 2015

Recently, Gary Pruitt, the president of The Associated Press released a column: “AP CEO: Government undermining ‘right to know’ laws”. In it he chided federal, state and local governments for

“undermining the laws that are supposed to guarantee citizens’ rights to information, turning the right to know to just plain no.”

He points to many specific efforts to obtain information on a variety of new-worthy subjects from the federal government that the government foiled, directly or indirectly. Among the obstacles that he faced were year+ delays (because an agency “has too many freedom of information act requests to meet deadlines”), and receiving hundreds of pages (nine years later!), with virtually every page completely blacked out on the basis that they contained “trade secrets”. In addition, some agencies just took more than a year to answer a simple request or even refused to answer any requests.

In addition, files that were potentially “embarrassing” were blacked out on the inapplicable basis that the agency had to shield personal information, such as a Social Security number. At the state and local level, things are not much better. Pruitt pointed out that officials in Ferguson, Missouri, billed the AP $135/hour to retrieve emails from a handful of accounts about the fatal shooting of Michael Brown – that is 10 times the cost of an entry-level clerk in Ferguson. At this is not limited to the AP – he cited other organizations facing similar barriers.

Well, that is just the “war” between the press and the government, right? No, it rolls over onto competitive intelligence as well.

What Pruitt talks about is a continuation of the trend that I noted some time ago – restricting the public’s access to government records because it is inconvenient (to the agency), potentially embarrassing to others, takes some time, or because it allegedly (and I use the word very carefully here) violates some protection in the law designed to prevent governments from disclosing personal information, business trade secrets, and the like – not to mention routinely blocking disclosures based on national security[1].

Production of these records now depends more on the attitude of the individual or individuals tasked with the project than the right of citizens to these records. let me add a few of our our experiences;

  • In one state, every time the state went into a budget “crisis”, it basically froze, without official notification of course, even acknowledging its receipt of open records requests, in spite of the fact that it charges for fulfilling the requests (so it could have actually made money on them).
  • In another state, requests that have to be acknowledged in a specific amount of time are answered with the statement that the request is being routed to someone else for their handling:  to the first bureaucrat, that constitutes fulfillment of the statutory obligations, but we just wait – and wait – and wait for the second (often unidentified bureaucrat) to respond.

Here are a couple more of my favorites (feel free to provide yours):

  • “We do not keep those filings for more than 30 days.” Huh?
  • “You have to give us the document number so we can find it”. And the document number is assigned by the filer (and appears on the document you want). Catch 22.
  • “You can come down and review the file here in the office (nine states away) and we will then make copies to send to you (in 7 weeks).” That is my “y’all come on down sometime.”
  • “The building plans are all returned to the architects, but they still have to let you see them.” Right.

And don’t get me started about “open meetings” laws that do not really force governments to operate openly (and to keep minutes) and, where the violation of these statutes is, at least in my home state of Pennsylvania, so widespread as to rarely evoke media comment.

What this means is that for those of us in CI is that the days of relying on swift and (relatively) complete disclosure of public records, information to which we should have access, appears to be vanishing. With respect to public records, transparency and open government are now just words – they are no longer an actuality. Government information access, except for the information that a particular government unit wants people to have, is becoming more difficult; transparency, where it still exists, is vanishing.

[1] See John J. McGonagle Carolyn M. Vella, “Competitive Intelligence, Corporate Security and the War on Terrorism”, CIO Magazine, October 2007.

Guest Blog: “Don’t be an ostrich. Listen to what your customers have to say”

Guest Blog: Avoiding Pitfalls in Capturing the Voice of the Consumer (VOC)

March 11, 2015

This is a paper that Jim Stockmal, Vice President and 2015 Conference Chair of the Association for Strategic Planning, did some years ago. As it follows on the theme of my recent blog, “The Competitive Intelligence Disconnect”, that is the failure of senior management to be open to new data and intelligence, Jim has permitted me to share it with you. Jim can be contacted at The underlying references can be obtained from Jim.


Capturing the voice of the customer means more than listening to what is stated; it involves creative thinking, “getting into their heads”, and “walking in their shoes”.  Today an organization that wishes to become customer centered must use a number of tools and methods to stay close to the pulse of their customers, including: focus groups, face-to-face interviews, customer visits, customer panels, blogs, and social media.  Combining more than one method makes good “listening” sense.

But organizations must do more than just listen.  They must hear and take action.  The table below highlights ten pitfalls to avoid and offers suggestions on how to mitigate the risk of inaction or appropriate response.


Pitfalls Meaning or Impact Suggestions
The Ostrich Syndrome ·         Managers/leaders “stick their heads in the sand” and avoid hearing anything·         Avoid taking action ·         Prepare leaders ahead of time·         Leader participation (two-way mirror)

·         Quick follow-up

Regret ·         Second guessing the questions used·         Striving for perfection ·         Think about how the voice will be used after capturing
Pseudo-clairvoyance ·         Hindsight·         “We already knew that…” ·         Ask for predictions prior to hearing the voice·         Then circle back on what they actually heard
Comfort Zones ·         Results are way outside of the comfort zone·         Denial and other resistance behavior ·         Prepare to defend validity –find supporting evidence·         Coaching


Data-poor Thinking ·         Lack of action after the voice is captured ·         Planning·         Templates for action
Action Audits ·         Failure to evaluate 0r explore unexpected results ·         Probing and moderating skill·         Question design
Unequal Opportunity ·         Failure to give bad news and good news an equal chance of surfacing ·         Mitigate research bias·         Screening participants

·         Timing

Missing Information ·         Failure to explore·         Striving for perfection ·         Recognition that one has to deal with uncertainty·         Use of decision & risk analysis tools

·         Rely on knowledge and experience

Analytics at All Costs ·         Over reliance on mechanical, non-humanistic methods ·         Combine and vary the tools and methods employed
Filtering ·         Hearing what you want to hear ·         Use of third party professionals·         Coaching & education

Not taking action on what your customers are telling you won’t help you become more customer centric.  Listen continuously.  Act purposefully.

The competitive intelligence disconnect

March 3, 2015

From time to time I refer to the competitive intelligence disconnect or the fundamental disconnect – the problem which arises when those producing competitive intelligence assessments are not the same as those making decisions based on them. To put it simply, they do not have to pay attention to what the CI shows.

Now, one could argue that this is something that probably occurs rarely. I am not so sure about that.

I just read two articles that seem to me to indicate that may not be the situation – rather it may be that the largest corporations may be truly averse to new intelligence which challenges their established beliefs or plans.

The first article dealt with Willy Heyman, Vice Chairman and chief investment officer of Travelers[1]. Discussing when he looks at the market for guidance for managing “everything from hedge funds to insurance assets”, he is quoted as saying that his key to prospering is to stick to a simple rule:

“Ninety-nine percent of the time the proper reaction to many new piece of information is just to file it away mentally and do just what you were doing before”. Interesting.

In a profile article about efforts to revitalize Target[2], the retail giant, the author focused on the new CEO. The author first dealt with the CEO’s efforts to evaluate the company’s stores by, gasp, actually visiting them incognito and even talking with customers. This is hardly surprising move, and in fact strikes me as sound management. However the article notes that this approach was in sharp contrast to the previous way Target had always operated:

“Store visits, ostensibly intended as intelligence-gathering missions, were meticulously planned affairs only slightly less formal, say, than a presidential visit. Every relevant national manager and local functionary would be notified in advance, each step choreographed, the ‘regular shoppers’ handpicked and vetted.”

Talk about using a Potemkin village approach versus actually gathering intelligence.

So now I wonder whether the competitive intelligence disconnect in large organizations is not so much an occasional problem as something that afflicts many members of senior management, who are evidently seeking to avoid confusion by avoiding new, particularly distressing, intelligence.

[1] Nathan Vardi, “Munificent Returns”, Forbes, March 2, 2015, p. 56.

[2] Phil Wahba, “Back on Target”, Fortune, Issue 3.1.15, p. 86.