in·​tel·​li·​gence

CFO Intelligence Magazine – Winter 2022

in·​tel·​li·​gence

Intelligence: It’s more than IQ Establishing an integrated competitive intelligence

program may give you a leg up in the marketplace.

CFOs utilize their intelligence every day to process information and chart strategy, but “intelligence” is more than intellectual ability. It’s also knowledge — about business competitors and opportunities — that a CFO and

his or her team gets and processes. This is known as competitive intelligence (CI).

The term conjures up all sorts of cloak-and-dagger images, but your name doesn’t have to be James Bond to effectively gather and use CI. Instead, effective organizations can gather and process CI by keeping their eyes open for data and then analyzing it.

Start by making a list of your major competitors, and then rank them by the threat they pose. Then, depending on your resources, ask some team members to keep a lookout for press releases and other announcements that could signal new initiatives — and keep in mind that creating a Google Alert with selected keywords can streamline the search. Also, periodically review their website and social media for announcements and other information.

Has your competition made any product, new-hire, partnership, M&A or other announcements? That could be

a tipoff about new ventures — and it might signal an opportunity in a space you hadn’t considered. Are they divesting a division or company? That may prompt you to do a deeper search to see if other enterprises are making similar retreats, and could be a signal for you to rethink your own company’s exposure to that segment. Or, if you’ve got a competitive advantage in that area, this could be the time to capture more market share.

Changes in the makeup of the Board, or an executive shakeup could mean the company’s looking at a new

strategic direction — particularly if the individual(s)’ background is different from the company’s core business. And new content partnerships could mean they’re going after a new kind of customer. For publicly held companies, earnings reports are often another valuable CI source. At the top level, they can signal the relative strength or weakness of your competitors; but a deeper dive, especially a review of the MD&A (Management Discussion and Analysis section) can highlight their challenges and opportunities.

And don’t forget Wall Street analysts. It may be worth subscribing to some services that offer analyst research notes focusing on your competition. Investors aren’t the only ones that can profit from this information.

Once you’ve established a framework for collecting competitive intelligence, consider who will analyze it and how they’ll record their observations. Getting “eyes” from multiple departments, including Sales, can help, since it promotes a variety of analytical approaches and encourages information sharing.

Developing a standard analysis/reporting form may help, with some kind of “action” section noting the departments to alert for each review. Remember, one of the goals in CI analysis is to break down unnecessary silos — especially since a CI development that one department considers to be minor could be a major find for another.

It may also be helpful to periodically schedule a CI review, summarizing where your efforts have paid off and where they’ve failed — and benchmarking your results can help you to pinpoint areas that need to be improved. Your competitors aren’t sitting on their hands — so your CI program should continually evolve and improve.