POINT OF VIEW
Competitive Intelligence: Strategic or Tactical?
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By Bonnie Hohhof
Director of Competitive Research
SCIP |
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The SCIP Fellows group posts a monthly discussion question on the
SCIP LinkedIn group designed to attract comments from a wide range of individuals. Mark Little recently asked this question:
Should we position competitive intelligence more toward strategy or should we focus more on the tactical needs of the organization? Is there a balance to strike?
To date, this question has received 117 comments from many individuals with different perspectives and backgrounds. Here’s a summary of a few of the key positions and opinions.
Pure Strategic vs Tactical Perspective
Not surprisingly, Ben Gilad came down squarely on the side of CI operating in the strategic realm:
Tactical intelligence should actually be a fully distributive model and the responsibility of operational managers coming in contact with third parties in the competitive arena. Deploying a professional resource for that [operational intelligence] is both inefficient and ineffective. We are better poised when we are used for battles where strategy is at risk.
Dan Clark also supported Ben’s position: “CI is all about strategy development.”
It’s About Where You Start
Starting a competitive intelligence function with a tactical focus can hinder future development. Michael Austin posits: “Initial placement of CI resources at the tactical level would lead to misuse, role redefinition, and potential disbanding, because even the best tactical decisions do not necessarily support strategic objectives.”
A tactical focus also presents the danger of downgrading analysis. As Burkhard Domke mentions, “being good in tactical intelligence may easily create overwhelming demand and bears the risk of degrading the function into an infomediary service fulfilling short-term requests — with no time for adequate analysis.” He also raises the question of processes and skill sets: “strategic and tactical intelligence require dedicated, dissimilar resources and ways of working.”
Mitch Emerson provides a more positive rationale for starting with tactical intelligence: “As CI teams get started, it is crucial that they are involved in the tactical role, as it provides a good understanding of the company's ability to execute at the point it matters most: where the dollars are earned.” This knowledge provides a base from which to grow into a strategic focus: “With an understanding of multiple competitors, the changes those competitors are making and how they are behaving, and why revenue is being won or lost, the CI team is in a unique position to contribute to the strategic role of an organization.”
A False Choice
Other individuals differed with the assumption that there has to be an either/or choice. Peter Spung commented, “When effective, CI is both strategic and tactical.” He goes on to describe how:
Strategically CI is about developing a deeper understanding of where value is migrating and how related value capture mechanisms (e.g., new business models and designs) may be emerging or changing that are more effective. Monitoring the landscape of competitors and substitutes for our firm's current value proposition is a key CI practice. It sets up a framework and feedback loop for identifying opportunity and performance gaps against our current value prop & capture mechanisms that need to be addressed in the market against each competitor and substitute viewed as a threat.
Tactically CI is about winning each market transaction against each competitor that matters, with the overall goal of winning more of them over time. The insights gathered from strategically monitoring the landscape, and tactically understanding the results of each market transaction, are fundamental. They feed future decisions, plans and actions to improve our value prop (e.g., thru innovation), organizational capability & effectiveness, and ultimately our competitive position.
Rob Goldberg took the position that it’s “how you frame the question that determines whether intelligence is tactical or strategic. The collection methods are similar, the analysis may be similar; what differs may only be your frame of reference.”
The Wrong Question
Troy Pfeffer pointed out the inadequacy of these labels applied to competitive intelligence: “The only question that should be asked is ‘What are the needs of MY organization and how can Intelligence assist?’ The answer to this question may change over time and as such, Intelligence should change over time. Intelligence is whatever it needs to be.”
And It Depends….
The relative focus of tactical and strategic competitive intelligence can often depend on individual characteristics of the company and the competitive intensity of the markets served. Likewise there’s the effect of the politics, culture, and organization of the company itself. Brought down to the personal level, there’s the background, goals and skills of the competitive intelligence manager, and the CI’s key stakeholders and champions.
Whenever someone who is starting in competitive asks me questions such as, “Should my group be strategic or tactical? What are the best practices?” I have to resort to the answer, “It depends.” As the positions outlined early in this article indicate, no one single approach or answer works in every situation.
Add your voice to the ongoing conversation
here.
About the Author
Bonnie Hohhof is the Director of Competitive Intelligence at SCIP. Share your thoughts on this column via email
bhohhof@scip.org or by taking this brief
survey.
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Share your professional views and experience in the field of
Competitive Intelligence. See upcoming themes slated for the
monthly SCIP Insight eBulletin below; choose a topic and
submit an article: |
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Feb |
Analytics and Methodologies |
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Mar |
Organizational Structure |
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Apr |
CI Professional Growth |
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The Strategic and Competitive Intelligence Professionals (SCIP)
merged with the non-profit Frost & Sullivan Institute in
2009. The partnership between Frost & Sullivan Institute and
SCIP provides a powerful opportunity to enhance the benefits
SCIP offers its members. |
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