Measuring the Benefits of Competitive Intelligence
Measurement of CI benefits is an important means of getting senior management support for the CI function. CI activity could be seen as an internal service with clear and defined product offerings that consists of required products such as competitor or customer profiles, industry monitors and strategic outlooks.
This means that like any other service, CI service can be measured on the basis of demand from internal customers, i.e. the decision-makers, and quality brought to them.
Measurement of CI benefits is an important means of getting senior management support for CI function. In the case of insufficient top-level commitment, the strongest incentive for senior management to implement intelligence systems is seeing other companies doing it and achieving cost savings.
One of the most effective means of demonstrating potential cost savings seems to be exploring someone else’s success in doing that first.
Key Statements from the Document
- Users of information usually expect tangible benefits from using CI products or services. They want CI output that supports their personal objectives. Therefore, CI products and services should focus on real and identified business objectives – such as getting more customers, developing better products and introducing new products to the markets in a timely manner.
- One of the most effective means of demonstrating potential cost savings seems to be exploring someone else’s success in doing that first.
- That the impacts of intelligence operations are indirect, just like in advertising, when the decision-maker does not know which part of the budget was actually responsible for the profit. Similarly, there is usually no direct causal relationship between revenues and the money spent on a particular piece of intelligence.
- It is especially interesting to note that a high level of intelligence seems to contribute to higher product quality. Thus, research and development activity can be viewed as a key customer of CI activity. Typically however, CI seems to be a relatively distant issue for the R&D function.
- If the organization has a clearly defined CI product portfolio, it is possible to measure the use or demand of a specific product. The use of a particular product can thus function as a measure of the related intelligence need.
- The intelligence obtained from a CI unit or department is only a part of the information used in decision-making.
- As a result, there should be ways to measure how much the intelligence obtained from CI activities actually affects decision-making.
- Treating CI as a service function with a clearly defined product offering and related production processes can serve as an easier approach to measuring the CI demand both in quantitative and qualitative terms.
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