More Notes from SCIP10: Using CI for Corporate Strategy

Using Competitive Insights to Help Develop Corporate Strategy; facilitated by Dale Fehringer, former head of CI at Visa

Dale introduced the topic by asking why we should examine this issue now?

• Economic situation

• Survey showed 81% of organizations will develop or adjust their strategies within 12 months

• CI can help with this process

• Being involved will give CI person visibility

The successful process that he used in his job in the corporate world included four phases:

1. Environmental scanning; one to twelve months

2. Strategy formulation; two weeks to two months

3. Strategy implementation; two weeks to two months

4. Evaluation and control; including collecting data on how competitors are responding

CI should be involved in all four phases. He asked the audience if anyone had worked in all four phases: no one had. About one-third were involved in at least one step.

In his first year at Visa, Dale was not involved in strategy development so the second year, he sent the strategists information. “It worked; the third year, they got me involved.”

How CI can help:

• Early warning

• Gap analysis

• Trend analysis

• Landscape; can be chart or bubble chart, but should include current and emerging competitors

• Recent reports

• Market position

• Identify new market segments; for example, new geographies.

Four Case Studies:

Visa: Identify and Evaluate New Entrant Threats

“Technology companies were claiming that they would replace credit cards and my CEO wanted information. Over a nine month period, I put team together from across the country. We got together a list of 50 potential new entrants, which we winnowed down to ten. We then ranked them. We brought Ken’s organization to help develop four scenarios ranging from destroying Visa to failing totally. We developed plans for each scenario. The CEO was so impressed that he gave the CI group more resources.”

IBM: “Deep Dive” Strategy Process

IBM’s deep dive process started in 1996. The process consist of picking a strategic issue, forming a team, including CI, doing a deep dive over one to three months, and presenting to the CEO. After three years, IBM abolished its annual strategy planning process and increased the number of deep dives.

ABB: Define Competitor Core Capabilities

The task was to define competitor core capabilities. This was done for the board which thought the work was a masterpiece; good visibility for CI team.

L&T: New Market Analysis

The group did a new market analysis of Sweden including a market share analysis and competitive landscape. L&T entered Swedish market and succeeded.

The strategy process is an opportunity for visibility and good work for CI professionals:

• Get involved

• Identify needs

• Insert yourself

• Develop a cross-company team

• Deliver results

• Follow up; ask “Did the work help you?”

• Leverage the work in your annual review