We say it often, but it bears repeating: Strategy is all about choice. At its foundation, business strategy comes down to decisive prioritization of what your organization will and won’t do in order to achieve its desired goals and outcomes. Landing on the choices and priorities that underpin any strategy requires insights inherently formed by a number of factors, always including but not limited to: 1) alignment on your business’ capabilities, 2) deep understanding of customer (and potential customer) considerations, 3) assessment of market and collaborator conditions, and 4) integration of competitive intelligence and competitors’ likely next moves.
Among many of the clients we serve, the first three are intuitively accepted and, with the right prompting, typically well understood. The fourth, however–while essential input for decisive prioritization–is often neglected or even discredited. Technology firms and other industries love Steve Jobs’ declarations about ignoring competitors,* yet they take that advice out of context. Jobs worried about anchoring on competitive capabilities, and limiting one’s own forward path to incrementalism, rather than disruptive business models–serving consumer needs in ways the marketplace had not yet even considered. Still, the tech industry is rife with rapid competitive imitation: As one example, consider the path of Instagram’s fast-replication of Snap’s innovations over the last several years.
it is sage advice to avoid anchoring on a competitor’s success, as your capabilities, assets, and even customer base may be different from theirs. And in most situations, HighPoint Associates would agree that competitive intelligence is simply an input to one’s strategy, rather than a sustainable driver of lasting strategic advantage. At the same time, the systemic neglect of competitive intelligence would be foolhardy and jeopardize your critical strategic choices. One would always question a coach who refuses to watch competitive video ahead of a critical playoff series. Take the travel industry. Whether in aircraft, commercial shipping, or cruise lines, public data on competitor supply (capacity) additions, balanced with anticipated changes in industry demand, absolutely should be a factor in a business’ own decisions about adding capacity. Failure to do so might create an imbalanced supply glut or limitation, or inaccessible routing. And even in less fixed-capacity industries, competitive intelligence–handled appropriately–informs and refines one’s own forward-looking moves, whether disruptive or incremental.
Competitive Intelligence Gathering
There are numerous methods to obtaining competitive intelligence. Historically, self-respecting consultancies have set forward clear ethical boundaries for their own consulting teams, many of which are summarized by organizations like the independent Strategic & Competitive Intelligence Professionals (SCIP).
Beyond public company information, primary research, and syndicated market data, next-level competitive intelligence used to be the exclusive domain of a firm’s internal functions and those of its close advisors. That market has fragmented into a variety of knowledge brokers, referral networks, and even automated digital scraping and scanning tools. This fragmentation can be helpful, while noting that it raises the bar for firms to reinforce ethical behavior across its many partners and conversations. Basic information has become a commodity, and newer technology and network tools allow for a deeper level of assessment, yet require appropriate governance.
Similar to data analytics, there is an art to gleaning valuable competitive insights for strategic choice. It centers on piecing together those more disaggregated inputs into the appropriate questions, insights, and informed decision-making. In highly competitive industries, one should consider future competitive game-boarding and even game theory simulations.
If competitive intelligence remains immature in your business as a central input to your strategic decision-making, HighPoint Associates can help you inventory your current practices, data, and governance, and develop efficient areas for maturation.
Is your businesses pursuing significant and sustainable profitability?
HighPoint Associates has assisted companies in developing lean, hybrid internal/external functions for deriving competitive inputs to strategy decision-making. These inputs are one part of our quickly identifying top strategic priorities that will support your growth and financial goals, while guiding your corporate, business unit, or go-to-market strategy with an objective, rigorously intentional, and accelerated approach. Contact us to start the conversation.