March 18, 2005, 4:25 PM — Bruce Taylor spoke with Arik Johnson, founder and managing director of Recon Competitive Intelligence at Aurora WDC on competitive dynamics among enterprises. This is an edited transcript of that conversation. You may also listen to the original interview here.
Hi. I'm Bruce Taylor, and this is Voices on ITworld.com. In a time of great concern about corporate risk, regulatory compliance, and the safety and sanctity of proprietary and competitive information, the field of competitive intelligence as a part of the strategic planning and positioning of a corporation may seem a bit of out of sync with the times. Our guest today, however, may have some very different thoughts. He is Arik Johnson, founder and managing director of Recon Competitive Intelligence at Aurora WDC, where he advises business leaders on how to better understand their business rivals, the competitive dynamics among enterprises in the marketplace. He also writes a syndicated column on competitive intelligence issues.
Bruce Taylor: Arik, welcome to the program.
Arik Johnson: Thank you, Bruce, great to be here.
Taylor: To begin, could you give me an overview of competitive intelligence, what it is, what it is not, what kinds of information gathering and analysis tools does it require, and things that you think that an audience of IT professionals would want to know.
Johnson: Certainly. Competitive intelligence is one of those undertakings that any moderately successful business will do, at least informally in order to create sustainability for itself and its market. And ultimately the level of formalization of that function sort of separates winners from losers, in my opinion. It allows organizations to out maneuver and outsmart, really out innovate their functional equivalents, their direct competitive rivals in whatever markets they decide to play in.
I think that there has been a great consensus building effort in the last few years to decide exactly what we mean by competitive intelligence when we talk about it, and it generally fits into two realms. The first, and what is arguably sort of the most important from a management perspective, is the strategic intelligence that's really collected from a predictive point of view. You're really trying to generate early warning of likely scenarios and events in the marketplace that present particular risks or opportunities to the long-term or near-term success of the business, its business model, its ability to attract and retain its customer relationships, and ultimately produce products and services that the market finds important and worth buying. At a tactical level, much more operationally, CI generally takes on the form of trying to benchmark an organization against its functional equivalents, or really against best in class or best in world practices that exist in the market to allow the company to either squeeze out cost to make itself more efficient, or to really just raise the bar in the industry and potentially to leapfrog its competitors.
That said, it is also, and perhaps foremost, directed at really selling and marketing more effectively the firm's products in the short-term to the customers that they have and customers that they feel would also be attracted to those products or services. And the analytical tools chiefly are divided into those two separate realms. You see very theoretical sort of pattern recognition types of applications that take place in the strategic realm where you're trying to effectively predict the future and your ability to be a part of it. And at the tactical level, it's very much one of creating messages or to comparisons between different metrics of performance between and among different companies, and there are, obviously, tremendous variance in the information systems that are used to produce those insights.
Taylor: You just raised something I'd never even thought of, that competitive intelligence could be seen as a component, if you will, in business performance management.
