Innovation and the Changing Field of Competitive Intelligence

Recently, a client asked me an intriguing question. This client sought to get a handle on innovation in CI, in particular, what was new and innovative in the CI vendor community. This client has a particular focus on using new technology in data collection and analysis, and it seemed to him that the CI landscape had become stale despite these new tools for data collection and analysis. The question behind all this was whether or not there is any real innovation in the CI world. A related question is the role of CI, and CI vendors, in a company.
What makes this an interesting question is that it has two sides. On the one side are the vendors who need to innovate and differentiate when there is a proliferation of collection and analysis tools that the client side can use to substitute for vendor collection. On the other side are the client side CI units that are being asked to do more with less and respond faster to a wider range of requests.

From the vendor perspective, the biggest innovation has been the emergence of empowered CI managers at clients. This innovation is less about the task and more about where the task is done.

One example is development of technology which allows the CI manager to collect data on competitors and the marketplace to a degree not possible a few short years ago. With this new capacity, CI managers are shifting some CI activities in-house. The most common change is to bring secondary search back to a company’s own CI operation. This has had the greatest impact on vendors who offer secondary search capacity, as this is a discrete CI skill that can be transferred in-house (or sent back out if budgets necessitate).

Another example is in the distribution of CI within the organization. Here too, technology has made it easier to develop and automate distribution lists, putting more CI into the hands of potential users, and doing so in a more targeted way. With this technology, the CI manager can target the distribution of information and analysis in real time and adjust what is sent to the users to maximize the relevance of what is delivered. As with secondary data collection, the main impact has been to bring in-house a service that was once contracted out.

Who does CI analysis and where it is done is yet another example of the empowered CI unit. CI analysis has traditionally been split between the client and vendors, with the split depending on the sophistication of the data analysis and the expertise of the vendor. Some analyses are done very infrequently by internal CI teams, and it makes sense to have a specialist vendor who is an expert do the task as an outsourced provider. New software has automated some of these expert tasks, and it has become possible to bring that analysis back in-house, although the expertise to interpret the analysis may be lacking. Shifting the locus of activity from an outsourced provider to an in-house resource can be a cost-saving action, as well.

The client side is moving to internalize many of the secondary data and distribution-driven functions of CI. However, CI is about so much more than just the collection of data, even what is termed as “Big Data.” Historically, innovations were developed and perfected by CI vendors who sought to create differentiation in a crowded market. Even today, vendors continue to play an ongoing role in the CI world and are bringing in new tools and perspectives as they seek differentiation. As the level of technology available to the client side has grown in sophistication and speed, the demands on vendors have changed as well. Vendor responses to changes in technology have ranged from more of the same to doing something truly different.

Over the past few years there has emerged a new category of vendor in the primary research space. These vendors operate more like a call center or survey house than a consultant and rely more on closed-ended surveys than on qualitative, open-ended interviews. These vendors have applied the tools of quantitative market research to the field of CI, leveraging panels, LinkedIn connections, and other social media to generate large sample sizes and respondent pools. This option tends to be less costly and can offer a very fast response time when compared to traditional qualitative primary research. For some CI managers the benefits of this option outweigh the disadvantages in depth of insight and flexibility.

Another vendor-based development is the use of purpose-developed conferences. These events draw together a range of subject matter experts who present on key areas of interest to a set of clients. What is innovative about these events is that they are structured to be an industry conference and include networking opportunities as well as presentations and other normal conference activities. This hybrid type of event allows sponsors to tailor the event to their CI needs in a public forum, taking the traditional industry conference in a new direction.

Vendors as a group have made improvements to the process of data collection and analysis, both as a part of the service they offer to their clients and as capabilities they add to the client’s resources. Many of the new secondary search tools were first developed by vendors who sought to create differentiation and cost savings through technology. Likewise, many of the analysis support tools (think big data and the like) were first developed by the vendors who then found it more profitable, and easier, to sell the tool rather than the analysis. While these improvements have clearly had a direct impact on how CI is done, many of them are innovative only in the sense that they have make the process more efficient.

When I look at the CI world today, it seems to me that the level of true innovation is low. We have seen a lot of development that improves the process, but little that improves the final outcome or effectiveness of the CI unit by translating CI into strategic or tactical decisions. This area is the one that most needs real innovation – and it is also outside the realm of most CI vendors.

What are your thoughts?

What do you think about this? Where do you see innovation in the CI universe happening? Are needs changing or are there new types of projects emerging?

– Erik Glitman, CEO