ESLSCA BUSINESS SCHOOL

Term Paper Competitive Intelligence

Under Supervision of Dr. Ahmed Nassar
MOSTAFA OMAR AZMY 12/29/2012

MBA G40 - Fall 2012 - Alexandria, Egypt. 1|Page

What Is CI?
1- A broad definition of competitive intelligence is the action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors and any aspect of the environment needed to support executives and managers in making strategic decisions for an organization. 2- The term CI is often viewed as synonymous with competitor analysis, but CI is more than analyzing competitors it is about making the organization more competitive relative to its entire environment: customers, competitors, suppliers, distributors, technologies, macro-economic data etc. 3- CI is the product of the process by which information is collected and transformed into valuable intelligence for use in tactical and strategic business decisions. 4- CI includes how to gather information, basic tools and strategies, strategic thinking, and building upon CI once it has been gathered. 5- CI is a necessary, ethical business discipline for decision-making based on understanding the competitive environment. 6- CI is a systematic and ethical program for gathering, analyzing, and managing external information that can affect your company's plans, decisions, and operations. 7- CI is the process of enhancing marketplace competitiveness through a greater -- yet unequivocally ethical -- understanding of a firm's competitors and the competitive environment. 8- Specifically, CI is the legal collection and analysis of information regarding the capabilities, vulnerabilities, and intentions of business competitors, conducted by using information databases and other "open sources" and through ethical inquiry. 9- CI enables senior managers in companies of all sizes to make informed decisions about everything from marketing, R&D, and investing tactics to long-term business strategies. 10- Effective CI is a continuous process involving the legal and ethical collection of information, analysis that doesn't avoid unwelcome conclusions, and controlled dissemination of actionable intelligence to decision makers.

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Why is CI important?
The purpose of CI is to make the best decisions based on the best available knowledge on a given subject.

CI can reduce the risk of making a wrong business decision. CI can't predict the future, but it can help make the right decisions about it.
Knowing what is going on in the marketplace and how it will impact your company is the key to market leadership. Competitive business intelligence promotes a business competitive position in the marketplace.

CI can be used to:

1-detect competitive threats, 2-eliminate or lessen surprises in the marketplace, 3-enhance competitive advantage by lessening reaction time, and 4-find new opportunities.

CI provides insight into future decisions such as:

1) 2) 3) 4) 5) 6) 7) 8) developing new marketing plans, counteracting competitors initiatives, considering a new product or line extension, entering new markets, repositioning an existing product, investigating a strategic alliance or acquisition, identifying new distribution channels, and counteracting imports.

How is CI different than business espionage?

CI is available via legal and ethical means not spying CI is Information that has been analyzed to CI is not Spying or espionage. Spying implies
the point where you can make a decision. illegal or unethical activities. While spying does take place, it is a rare activity. Corporations do not want to find themselves in court, nor do they want to upset shareholders.

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What are the general uses of CI information?

The goal in defining CI requirements is too meet business leaders CI needs. Ensuring CI efforts are proactive, and strategic. Intelligence requirements need to be defined by decision makers, typically senior management. Key Intelligence Topics fall in 3 Different Categories: A. Strategic decisions and actions, B. Early warning topics, and C. Profiles and descriptions of key players

Information has numerous sources, which have different degrees of reliability. Describe 5 such sources and rank them in terms of highest to lowest level of reliability for competitive intelligence.
Most sources (70%-80%) for CI are secondary (not first hand), such as newspapers, journals, press releases, ads, web sites, etc. which have lower degree of reliability Primary sources (first hand) include interviews, surveys, and other direct research techniques.-->highest source of reliability

CI should try to enlist in-house experts. Larger companies should create and maintain a
Yellow Pages of in-house experts. And CI Professionals live by their rolodexes the contacts and sources for completing their

CI Projects.

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What are the tools and techniques used for CI activities?

a- Primary Sources (human sources) i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. Industry observers: Researchers, Industry analysts, Stock analysts Industry participants: Suppliers, Customers ,Consultants Your sales force Trade shows Competitors Within or outside your industry Secondary Sources Advertisements Annual reports Business credit reports Company profiles Help Wanted Ads b- CI Projects follow the scientific approach to problem solving: (Analytical process) i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii. Define the Question, Gather Data, Organize the Data, Synthesize and Filter the Data, Analyze Appropriate Data, Prepare Your Findings, Draw meaningful insights, Prepare recommendations, Draft CI Report, Review and Approve Report, Issue Report, and Follow-up and correct process.

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Is it true that CI is only important for big businesses?

No, CI is very important in small businesses, as these businesses need CI To: Reduce risk of making wrong decisions Get early warning of threats and challenges Uncover inaccurate assumptions Learn what they dont know Understand market niches and differentiation Find potential alliances and partners Develop a strategic action plan

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