6 common questions about Competitive Intelligence
Although Competitive Intelligence is an increasingly extended and recognized activity, it is still unfamiliar to many people. In this post we try to answer the main questions that we are asked continuously.
1. What is Competitive Intelligence?
We wrote a post about this, but it is worth explaining it again: CI is an ethic, systematic and collaborative process, supported by specific tools, of collection, analysis, dissemination and interpretation of relevant information about the competitive environment, which is transmitted to the responsible bodies in the organization to generate an ideal context for decision-making.
This definition of CI may result very complex for some public, so we often resort to this definition of the guru Michael Porter: “Competitive Intelligence consists on giving the correct information to the correct person to make the correct decision in the opportune moment”.
2. Who can practice CI?
The answer is easy: EVERYBODY. Competitive Intelligence is centred in capture, analysis and diffusion of information about the environment of the organization; so any company, organization, association, public administration or even a freelance can benefit from it. All of them have competitors, customers or suppliers; an interesting technology that affects them, sectors of interest, etc.
Of course, we don´t mean that everyone has to organize their CI in the same way; each one should see where it brings benefits and size it upon available resources.
3. Is Competitive Intelligence expensive?
In this question we should be again emphatic in the answer: NO! What is understood as expensive? There are two definitions that are relevant:
“Something that is high in price or cost much money”.
Does CI cost much money? It doesn´t have to. As we have said previously, each one has to find its manner to practice CI, adjusting it to available resources. If someone considers that CI is expensive, it is because the activity has been oversized or it is inefficient.
“Something that is high in price in relation to other similar goods”.
Is CI more expensive than other processes of the organization? It doesn´t have to. Other processes carried out in the organization, like quality management or human resources management often suppose higher expenses than CI. As we have said before, everything will depend on how the activity is sized…
4. Can CI’s Return on Investment (ROI) be measured?
Although this question can generate a discussion, we dare to say that YES. Of course, like any other activity, it can be measured. The problem is that there isn´t a universal formula that can be applied in any case. Each project requires evaluating where the benefits of CI activity are obtained (both in terms of generating opportunities and improving efficiency) and measuring these aspects. A priori, it may seem difficult, but if objectives are well defined and sized, it is much easier. You can find more information about ROI of CI in this post.
5. Is a commercial tool necessary to carry out CI?
In this case, even going against our interests, the answer is clear: NO. Professional tools help systematizing and strengthening CI activity, reducing necessary time and improving efficiency, but they aren´t indispensable. There are many cases of organizations that have based their CI on free tools with great success. The key is, as we have said many times, choosing the tool that better fits the organization’s needs.
6. Can CI activity be externalized?
In this case, the answer is IT DEPENDS. On what? As always, it depends on organization’s needs and resources. On people’s abilities. On the existing urgency. We wrote these two articles analysing the advantages and disadvantages of externalization:
If you are going to launch a CI initiative in your company and you need help, or you have more questions we haven´t considered in this article, contact us and we will help you. You can also try a professional software like INNGUMA requesting a free demo.