POINT OF VIEW
Selling Competitive Intelligence:
A Value Perspective
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Bonnie Hohhof
Director of Competitive Research
SCIP
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A recent discussion on SCIP’s
LinkedIn group asked, “Why is it so difficult to sell competitive intelligence?” This question has been asked many times over the years, with different degrees of success in answering it. Here are several selected responses from this discussion, which reflect the diversity of thought that often characterizes competitive intelligence.
The reality is that competitive intelligence must have a value proposition for the business to facilitate its acceptance. Value can be defined from multiple perspectives. Intelligence has to be credible and appropriately framed to make it actionable to both the budget funder and consumers of the information. Another aspect to the value proposition (where possible) is that CI should complement other organizational efforts, such as strategy development and issue analytics.
CI as a separate activity
One vein of comments is focused on the difficulty managers have in perceiving competitive intelligence as an activity separate or different from the traditional areas of marketing. There’s often a broad overlap in skill sets between the two, and as managers are much more comfortable with marketing as a discipline, the tendency is to view CI as a sub-set of marketing. This view is strengthened by the situation where marketing managers provide elements of competitive intelligence to the company, in lieu of a formal program.
One commenter, Brett Heller, compared the difficulty of selling the value of a formal competitive intelligence function to the difficulty in justifying the existence of other service functions such as Information Technology (IT) or Marketing. At least marketing benefits from the group’s internal skill set to “market” itself to decision-makers. And with IT, everyone in the company has a “hands-on” connection or exposure to it since they all use a computer or phone. CI rarely benefits from either.
CI for better decisions
A more fruitful approach is establishing the value of competitive intelligence by demonstrating how it affects decisions. Here, the key to finding and communicating the value of intelligence is in understanding and showing how it will positively affect the quality of decisions. The decision impact of CI deliverables stems from information accuracy, excellent qualitative and quantitative analysis, sharp relevance to (internal or external) clients’ needs, and effective communication.
But the nature of decision-making itself contributes to a muddied value proposition. It’s difficult to segment and provide impact valuation of all the variables that are considered when a decision is made. Add to this the general human tendency to attribute decision success to personal intuition and experience, and attributing decision failure to incomplete support from others.
CI as a process
Another commenter, Isabelle Gorrillot, noted the difficulty in “selling” the CI function resulting from both a lack of scope and unclear definition. It is inaccurately perceived as a subject-matter function while it is a process function.
The first step to “selling” is to know your targeted customer base—define the market segments (not only industry-based but also function-based) to be addressed and conduct standard strategic marketing studies of the problems, the needs, and the user personae of the intended CI services.
The second step is to craft and price these services based on accurately identifying and valuing the competitive benefits of...competitive intelligence. In this exercise, it is important to compare what is comparable. For example, CI is to Intelligence what patent prosecution is to legal. Yet, you do not have a “patent prosecution” department, but a legal department that overarches all corporate functions. Similarly, there should be a Corporate Intelligence department incorporating information research, CI, market analytics, etc., and which would service all corporate business units. Its value would come out much clearer than that of CI, and
would, in turn, be much easier to sell.
CI for 360 degree impact
One commenter, Daniel Cho, provided a specific example of how competitive intelligence has prospered in his organization by implementing a 360 degree approach that impacts every decision point in the company. Many intelligence functions serve only “upstream” decisions for the benefit of two to five people. As CI is part of many inputs, this makes it difficult to measure how CI impacts the quality of decisions. Most of these decisions are also longer term, making it more difficult to justify the here-and-now investment.
We created a competitive intelligence infrastructure that links downstream (sales and marketing, product generations and marcom) and upstream (strategy, mergers and acquisitions, CXOs). Our CI infrastucture serves all levels from CEO to the Sales person that is presenting to the customers, and in all geographies.
We created a platform for people to share their knowledge, and we collect, interpret, integrate and consolidate (and sometimes localize) this knowledge into toolkits that people can use. We help Sales & Marketing win deals and give them bullets to counter competitive attacks in real time. We make sure that what we do in Marcom makes sense for the market, and also that what we will be introducing has direct impact to win customers from
the competition.
Go as broad as possible to gain support, and help as many people as possible to achieve their growth. CI is so integrated into everyone's life here, that no one ever questions the value of CI.
CI as dispelling the dark
In his blog post, “Picking a Fight in the Dark,” Mark Chussil combined elements from this discussion with his own thoughts on why it is so difficult to sell competitive intelligence. Here are some excerpts (the full post is
here).
It’s a reasonable question, especially because, from a CI perspective, competing without CI is like picking a fight in the dark. The question itself —
“why is it so difficult to sell” — presumes that the customer, the
decision-maker, should buy. Perhaps we should challenge that
presumption and ask a
different question: what has to happen for a rational decision-maker to
decide to buy CI?
So, why might a rational decision-maker not buy what the
CI professional wants to sell? Thinking through which reasons might apply
can help the CI pro figure out whether and how to move forward.
- Lack of information. The decision-maker may not know the threats or opportunities faced by the business. She or he may not know the ability of CI to identify and clarify those threats or opportunities.
- A belief that the
right action is already being taken. If the decision-maker believes that nothing can be done, or that she or
he has already set the right action in motion, then there’s no use in getting more data.
- Overconfidence, groupthink, etc. We humans suffer a variety of biases that affect our decisions. An over confident person — are you sure it’s not you? — would think it irresponsible to spend time and money to find an answer when he or she already has the answer.
- Low value of information. For CI to have economic value, it must cost less than the benefit it will provide. The cost of CI is fairly clear. The benefit may not be: it depends on the odds that you’ll learn something new, the odds that the new knowledge will affect action, and the difference that action can make in the bottom line. Using his or her mental calculator, the decision-maker may sincerely come to a different conclusion than you.
- Not enough. The decision-maker may be out of bandwidth, the company treasure chest might be dry. Asking for something that doesn’t exist, especially if it could lead to further demands for that same nonexistent something, might not fly.
Notice that perceptions, not “reality,” pervade the reasons why a decision-maker may not want to buy what you want to sell. I’m not saying their
perceptions are right or wrong. I am saying 1) that they are perceptions and
2) that customers use their perceptions, not yours, to make their purchase
decisions.
If you’re finding it difficult to sell CI, then your perceptions, which also are
not “reality,” differ from those of the decision-maker. You must change her
or his mind to
make the sale, or you must change your mind to
get past the “difficulty.” The point isn’t to pick a fight with the decision-maker. The point is to dispel the dark, add light to the conversation and to receive it too. Everyone wins.
CI as running with scissors
This observation was made in a recent comment by Enrique Gochuico:
" Like any tool, it takes practice to learn how to use and apply competitive intelligence effectively. Applied in a way that it is not designed for can be injurious to the user.“
The lack of knowledge of the end user on how to apply CI, the cost or expense related to it, and the debatable way to measure ROI makes CI a difficult sell to management. However, companies that have addressed the issues above are easy to spot in the market place. They are usually the most innovative, key players in their product category.
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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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