Back To The Basics Of Corporate Intelligence: A Practitioner’s View
This post is part of a series providing insights aimed at corporate strategists seeking competitive advantage through better and more accurate decision-making. The full series is available at our special section on Decision Intelligence.
Organizations in competitive environments should continually look for ways to gain advantage over their competitors. The ability of a business to learn and translate that learning into action, at speeds faster than others, is one of the most important competitive advantages you can have. This fact of business life is why the model of competitive success articulated by former Air Force fighter pilot John Boyd, the Observe – Orient – Decide – Act (OODA) decision loop, is so relevant in business decision-making today.
In this business model, decisions are based on observations of dynamic situations tempered with business context to drive decisions and actions. These actions should change the situation meaning new observations and new decisions and actions will follow. This all underscores the need for a good corporate intelligence program.
What is Corporate Intelligence?
Any information that can drive critical corporate decisions can be called intelligence. Intelligence involves acquisition of information, analysis, processing, and dissemination of actionable insights to the decision-makers. Major sub-disciplines of corporate intelligence include Competitive Intelligence, Threat Intelligence, Market Intelligence, Business Intelligence, Due Diligence, and Technology Forecasting.
Optimizing intelligence processes to meet the needs of corporate decision-makers is a continuous challenge. Getting intelligence functions right can lead to observations on the business environment and analysis that will help drive the best decisions and actions. Getting intelligence functions wrong can waste money and time, and, at worse, put the company at risk by enabling bad decisions and the wrong actions.
What can go wrong when your corporate intelligence activities are not optimized?
- Consider the firm that goes to market with no competitive intelligence. This may result in launching of products or services that are undifferentiated or even far inferior to competitors and therefore fail in the market.
- Or consider the firm that is oblivious to targeting by criminals and therefore does not put into place appropriate risk mitigation. Or perhaps overspends on security because of inaccurate threat models, which is also a risk.
- Business intelligence that goes wrong can result in inaccurate forecasting of sales, revenue and profit, which can have devastating effects for publicly traded companies. Private companies also need solid business intelligence, getting it wrong will result in lost opportunity.
- Due Diligence failures can result in a bad investment or acquisition that ends up costing far more than just the price paid for the firm.
- Poor Technology forecasting can result in wasted R&D spend and years of missed opportunities.
- Consider the company that makes decisions based on deceptive information, which may lead to the wrong decisions being made. Similarly, consider the company that has the right information but whose internal analysis processes cause inaccurate judgements.
Who Does Corporate Intelligence Serve?
The short answer to this question is that corporate intelligence serves all corporate decision-makers. But a longer answer can be helpful in building the right intelligence program for your organization. Intelligence professionals look at intelligence customers as fitting one of three broad levels: Strategic, Operational and Tactical. These three terms are also be used to describe the type of intelligence being provided.
Strategic Intelligence Users:
Analysis and information that can help organizations understand the strategic environment is called Strategic Intelligence. It is used by board level or C-suite decision-makers to make effective long-term decisions. Other users of strategic intelligence are leaders who contribute to corporate planning, development of new products or product roadmaps, strategies for entering new markets, decisions to initiate M&A activities and other impactful decisions. Examples of strategic intelligence include the reporting and analysis in the OODA Daily Pulse or other strategic newsletters and publications serving the C-suite. Due diligence prior to an M&A activity is also an example of strategic intelligence.
Operational Intelligence Users:
Leaders who make day to day decisions on topics like commitment of corporate resources or decisions on how to best carry out corporate policies are users of operational intelligence. Designing an effective corporate intelligence program to serve operational decision-makers requires an understanding of their specific business function and a tailoring of intelligence to ensure it is relevant and contextualized for operational decisions. Examples of operational intelligence includes business intelligence over data to inform changes in ad spend, or insights from a real time view of the supply chain that may drive decisions on finding new partners. Other users will require operational intelligence for investigating potential new suppliers or partners or potential new key employees. Operational intelligence users in security and IT may use information to raise defenses or prioritize patching of systems, or implement a new user training program.
Tactical Intelligence Users:
This is information designed to support immediate decision-making. In some cases this can be automated information being handled in ways corporate policy dictates. When working well, tactical intelligence will not require executive level decisions prior to action. Examples of tactical intelligence may include automated threat intelligence feeds that alert network defenders that a new malware signature has been spotted and needs to be instantly remediated, or indications that inventory levels of a particulate item need resupply, or indications that weather will cancel and event or cause a need to re-route supplies.
Designing your corporate intelligence program to provide strategic, operational and tactical intelligence will ensure it provides comprehensive support to decision-makers.
Key Terms of Art
Executives seeking to optimize corporate intelligence functions will more than likely need to work with experienced practitioners of intelligence both inside the organization and in partner firms. A familiarity with the language of the profession can help ensure that is done with as little ambiguity as possible.
This is an initial lexicon that will aid in shaping and running your program:
- Corporate Intelligence: Ethically and legally produced information designed to drive corporate decisions.
- Competitive Intelligence: Information on other firms vying for your clients.
- Threat Intelligence: Information on hostiles including criminal groups and nations (when the term used is Cyber Threat Intelligence it usually implies information with technical details on the cyber threat).
- Market Intelligence: information on what the market wants now and, in the future.
- Business Intelligence: insights gleaned from data, including internal financial data
- Investigative Due Diligence: Insights produced in support of investment or acquisition decisions
- Technology Due Diligence: The study of technology of potential acquisition firms to assess the value and potential weaknesses of the tech. Also the study of the tech used by target firms.
- Technology Forecasting: Insights into the future technology landscape designed to drive decisions
- Open Source Intelligence: Term used by intelligence professionals to underscore that the information is not collected by governments. In colloquial use it often implies technical methods of interrogating Internet connected resources to find information.
- Intelligence Collection: The actions taken to bring data to the corporation in ways that inform the corporation’s intelligence processes.
- Requirements Management: The process of ensuring that information desired by the corporation is articulated to collectors in a precise way.
- Elicitation: Professional methods of asking experts or witnesses or others knowledgeable of a situation for information.
- Analysis: The value-added methods of thinking about a topic and coming to conclusions.
The other posts in this series build upon this introduction to deliver insights on optimizing your corporate intelligence program based on lessons learned from a career in the intelligence community and in applying this principles in the private sector. For more see:
This post dives into actionable recommendation on ways to optimize a corporate intelligence effort. It is based on a career serving large scale analytical efforts in the US Intelligence Community and in applying principles of intelligence in corporate America. See: Optimizing Corporate Intelligence
The study of mental models can improve your ability to make decisions and improve business outcomes. This post reviews the mental models we recommend all business and government decision makers master, especially those who must succeed in competitive environments. See: Mental Models for Leadership In The Modern Age
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Fine Tuning Your Falsehood Detector: Time to update the models you use to screen for deception, dishonesty, corruption, fraud and falsity
The best business leaders are good at spotting falsehoods. Some joke and say the have a “bullshit detector”, but that humorous description does not do service to the way great leaders detect falsehoods. Bullshit is easy to detect. You see it and smell it and if you step in it it is your own fault. In the modern world falsehoods are far more nuanced. Now more than ever, business and government leaders need to ensure their mental models for detecting falsehood are operating in peak condition. For more see: Fine Tuning Your Falsehood Detector: Time to update the models you use to screen for deception, dishonesty, corruption, fraud and falsity