information from the cutting edge tm breaking the ci turnover cycle © 2007 cutting edge information...

INFORMATION FROM THE CUTTING EDGETM

Breaking the CI Turnover Cycle

© 2007 Cutting Edge Information

Elio Evangelista,Senior Analystelio_evangelista@ cuttingedgeinfo.com

www.CuttingEdgeInfo.com

INFORMATION FROM THE CUTTING EDGETM

Competitive Intelligence in Sports

2000, 2001, 2002, 2003, 2006

1996 1997

INFORMATION FROM THE CUTTING EDGETM

Key Idea #1: CI Teams are in Danger

• Break the Cyclical Turnover

• Give CI Teams More Time

• Communicate Successes Constantly

INFORMATION FROM THE CUTTING EDGETM

The CI Cycle

Time (in years)

Tea

m S

ize

0 5 n

INFORMATION FROM THE CUTTING EDGETM

Years CI Has Been in Place

Though some groups have been in place for more than 20 years, in general, CI is a young function at most companies.

0

5

10

15

20

25

0.2 0.5 0.5 1 1 12

45 5 5

7

10 10

20

23

6

Average C D B J H K MA E FG O L IN P

Yea

rs in

Pla

ce

INFORMATION FROM THE CUTTING EDGETM

“It’s relatively easy to produce these reports, it is hard to make sure people know where to get them and actually use them when they are planning.”

- Interviewed Competitive Intelligence Manager

Voice of CI – Communicating the Results

INFORMATION FROM THE CUTTING EDGETM

Communication Through the Organization

CI CEOX

INFORMATION FROM THE CUTTING EDGETM

Key Idea #2: CI Structures Sometimes Inhibit Success

• Utilize the CI/Market Research Overlap

• Establish a Proactive CI Team

INFORMATION FROM THE CUTTING EDGETM

To Which Department Does CI Report?

CEO: 13%

Market Research: 69%

Business Development: 6%

R&D: 6%Sales: 6%

INFORMATION FROM THE CUTTING EDGETM

“Whenever we collect competitor information, we are in fact collecting

competitive intelligence.”

- Interviewed Market Research Manager

Voice of CI – Market Research Link

INFORMATION FROM THE CUTTING EDGETM

Percentage of Market Research Groups Collecting CI During Cutting Edge Information’s study Pharmaceutical Market Research, researchers discovered that the vast majority of market research departments also collect competitive intelligence.

Does Collect CI - 87%

Does Not Collect CI - 13%

INFORMATION FROM THE CUTTING EDGETM

The CI/Market Research Overlap

Past Present Future

Market Research

Competitive Intelligence

Market Research focuses on:

• Current market conditions

• Market awareness for new products

• Potential sales forecasts based on historical data

CI focuses on:

• Developing scenarios and alternative futures

• Scanning present-day data to forecast future events

• Preparing brands to proactively change strategy based on market indicators

INFORMATION FROM THE CUTTING EDGETM

Percent of respondents rating CI effective or very effective*

Decision Support: 67%

Market Monitoring: 67%

Identify Market Opportunities: 66%

Market Plan Development: 63%

Market Plan Input: 57%

1

2

3

4

5

CI’s Top 5 Marketing Roles

*Source: Survey of SCIP members by The Pine Ridge Group, Inc. and T.W Powell Company

INFORMATION FROM THE CUTTING EDGETM

Centralized vs. Decentralized Prevalence According to our survey, a large majority of companies maintain a centralized, strategic CI groups.

75%

25%

Centralized

Decentralized

INFORMATION FROM THE CUTTING EDGETM

Centralized vs. Decentralized Tendencies Centralized CI groups are more strategically-oriented and, therefore, more proactive than decentralized units.

Centralized Structure

Reactive Tactically Oriented

Strategically Oriented

Proactive

Decentralized Structure

INFORMATION FROM THE CUTTING EDGETM

Key Idea #3: Get Everyone Involved

• Build a CI Culture

• Integrate Internal Functions

• Establish Senior CI Leadership

INFORMATION FROM THE CUTTING EDGETM

Company A’s CI Reporting Structure

Director of Strategic Research

VP of R&D

CEO

Company A has two distinct CI units – one housed under business development and the other under marketing.

Sr Director ofMarket Research

Director ofMarketing CI

Sr VP ofMarket Research

Sr VP of Marketing

President

INFORMATION FROM THE CUTTING EDGETM

Company O’s Field-Based CI ProcessThough it isn’t mandated, the sales reps at Company O are encouraged to participate in collecting competitive intelligence.

Data Sources

Sales Reps

Centralized Competitive

Intelligence Unit

Sales Directors

INFORMATION FROM THE CUTTING EDGETM

At Company C, the CI unit is a sister organization to the brand teams and is housed under marketing. With this structure, the group has more brand level tactical influence than company-wide influence. However, should an issue arise that needs company-wide attention, CI also has a dotted reporting line directly to the firm’s president.

CompetitiveIntelligence

Brand Team AGovernmentRelations/ Regulatory

MedicalRelations

Head ofMarketing

Brand Team B Brand Team DBrand Team C

President

Integrating CI into the Culture

INFORMATION FROM THE CUTTING EDGETM

Level of Executive Leading CI

As seen, the majority of surveyed CI units are led by managers. However, 44% of firms employ someone more senior than a manager to head their CI departments.

56%19%

6%

19%

Manager

Director

Executive Director

Senior Management

INFORMATION FROM THE CUTTING EDGETM

Experience Makes a Difference

A B M F N I P Avg.

0.51.0

5.0

7.0

10.0

20.0

23.0

9.5

0.0

5.0

10.0

15.0

20.0

25.0

Ye

ars

in

Pla

ce

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0.2

3.5

10.0

5.05.0

2.0

1.01.0

C E J H G O L Avg.

Ye

ars

in

Pla

ce

Number of Years CI has been in Place Where Senior Leaders Head the Group

Number of Years CI has been in Place Where Managers Head the Group

INFORMATION FROM THE CUTTING EDGETM

Key Idea #4: Experience Makes a Difference

• Leverage Staff Experience

• Outsource CI Strategically

• Staff the CI Team Accordingly

INFORMATION FROM THE CUTTING EDGETM

Typical Experience Levels of CI Professionals

On average, professionals in the CI field have 5.6 years of CI experience.

0

2

4

6

8

10

12

C G MN L A AverageH

2 2

3 3

4

5 5 5 5 5

10 10 10 10

5.6

B F E I P D O

Exp

erie

nce

(in

yea

rs)

INFORMATION FROM THE CUTTING EDGETM

Typical Experience Levels of CI New HiresA typical new hire in the CI field has 3.7 years of experience.

0

2

4

6

8

10

12

0

11.5

2.53 3 3 3 3

5 5 5 5 5

10

3.7

F I NA L E AverageOD C G J B H P M

Exp

erie

nce

(in

yea

rs)

INFORMATION FROM THE CUTTING EDGETM

Traits of Successful CI Analysts

Communication and analytical skills rank tops among traits of successful CI employees, according to survey results.

Leadership

Persistence

Innovative

Strategy oriented

Strong analytical thinking

Communication skills

Data oriented

Strong intuition

High ethical standards

Market research experience

Dedication

Inquisitive 6%

6%

6%

6%

31%

56%

63%

63%

60%

81%

81%

56%

0% 20% 40% 60% 80% 100%

Percentage of Companies

INFORMATION FROM THE CUTTING EDGETM

Average Number of FTEs in CI

Because CI groups outsource a great deal of work, they run their departments with a relatively low number of FTEs.

0

1

2

3

4

5

6

7

D O PC E G AverageM

0

0.5

1 1 1 11.3

3 3 3

4

5 5 5

6

2.7

I B N A F H J L

Fu

ll-T

ime

Eq

uiv

alen

ts (

FT

Es)

INFORMATION FROM THE CUTTING EDGETM

Percentage of Companies that Outsource Data Analysis Three-quarters of survey participants prefer to conduct their competitive intelligence analysis in-house as opposed to using a third-party.

75%

25%

% of companies conducting data analysis in-house

% of companies that outsource data analysis

INFORMATION FROM THE CUTTING EDGETM

“Obviously, the focus on competitors is a unique purview of CI. CI has the

greatest potential to see where competitors are going.”

- Interviewed Director of Competitive Intelligence

Voice of CI – The Value of CI

INFORMATION FROM THE CUTTING EDGETM

Four Tenets of CI

Communicate Successes

Set Your Goals

Get Top-Level

Support/Buy-in

Stay On The Ball

INFORMATION FROM THE CUTTING EDGETM

Thank You!

4711 Hope Valley Rd, Suite 205Durham, NC 27707

Tel: (919) 433-0214Fax: (919) 433-0220

Email: elio_evangelista@cuttingedgeinfo.com