Around the year 500 BC, the great Chinese military strategist, Sun Tzu wrote a treatise on the Art of War. Those strategies are still relevant today – for both military commanders and business leaders looking at how to win against competitors.
“Know your enemy and know yourself and you can fight a hundred battles without disaster. Strategy without tactics is the slowest route to victory & Tactics without strategy is the noise before defeat. The supreme art of war is to subdue the enemy without fighting.” – Sun Tzu
Competitor Analysis is an important part of the strategic planning process. It outlines the main role of, and steps in, competitor analysis. But some businesses think it is best to get on with their own plans and ignore the competition. Others become obsessed with tracking the actions of competitors. Many businesses are happy simply to track the competition, copying their moves and reacting to changes.
Better management decisions come only if good information is gathered & supplied. Prerequisite for survival in globalization is to generate competitive advantages using “Competitive Intelligence”
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.
Competitive intelligence is used to compare themselves to other organizations, to identify risks and opportunities in their markets, and to pressure-test their plans against market response (war gaming), which enable them to make informed decisions. Most firms today realize the importance of knowing what their competitors are doing and how the industry is changing, and the information gathered allows organizations to realize their strengths and weaknesses.
4C’s to monitor competitor:
– Collecting the information (First deciding what to collect & it’s use.)
– Converting information into intelligence
– Communicating the intelligence.
– Countering any adverse competitor actions – i.e. using the intelligence.
Information can come from various sources, internal as well as external like Sales representatives (best internal source), R&D team, Purchase Department (Our Supplier Supplying to other companies), Market Research, Media Campaigns, Internet, etc.
Having information collected, now starts a Jigsaw puzzle to arrange each piece of data to make a complete picture. Remove duplicate data, out of date data, wrong OR inaccurate information, incomplete data or misleading information. Though few pictures may be missing, you will be able to visualize complete picture. Data collected should be well catalogued & indexed in a way that new information/data received can be easily linked. That’s converting information/data to intelligence.
“If you are ignorant of both your enemy and yourself, then you are a fool and certain to be defeated in every battle.” – Sun Tzu
Unless intelligence is communicated, selectively within organization, it creates doubts and questions about changes being implemented in organization. Change in decision after data analysis may affect to product design, production process, marketing strategies & even finances.
Sun Tzu: “Regard your soldiers as your children, and they will follow you into the deepest valleys; look on them as your own beloved sons, and they will stand by you even unto death.”
Now it’s all about countering OR entering into battle with proven theories & strategies world over. You have enough “Competitive Intelligence” by now to win.
To fight and conquer in all our battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting. – Sun Tzu
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