Hot to get an edge by keeping a close eye on competitors

To make good business decisions, you must have strategic knowledge about your competitors. Otherwise, you risk taking the wrong decisions which, at best, will cost you a lot of money, and, if the worst comes to the worst, mean the end of your company.

GS Patton, one of the most controversial and also most successful generals from WW2 put it this way:

"Successful generals make plans to fit circumstances but do not try to create circumstances to fit plans".

Carefully scrutinising your competitors' strategies can help you become much more effective in your own business doings.

Many boardroom strategies and plans are laid by people who do not really have the essential knowledge about competitors. This is very problematic because you are not the only company trying to win customers, and competitors' actions greatly influence your chances of success.

Most companies have some kind of "competitor file" with information about rivals, but its contents are often limited to obvious sources such as internet searches, competitor brochures, ads and articles, and perhaps rumours picked up in the field by your sales team.

Here's why that's not really enough:

* You need more adequate information
* You need more forward-looking information
* You need to work up the information - turn it into knowledge
* You need to communicate the knowledge

You need more adequate information
Ask yourself this: what would enable you to outmanoeuvre your competitors? Is it just listing what products they have, what their ads look like, whether they hand out freebies and useless trinkets on their stand?

Consider instead gathering intelligence about how the company is run (its culture), how they spend their resources (priorities), whether they are satisfied with their current position, etc. If they're not, what moves can you expect and which would be most threatening for you?

You need more forward-looking information
Predicting is not easy but the key to good competitive insight is not only knowing what the competitor has done, but also anticipating what moves you can expect so that you can plan your own next move. Just like in a game of chess, you must try to be proactive by envisioning your opponent's next move.

If you have studied closely how your opponent has played before, you'll have a much better chance of predicting, not only his next move, but also his whole strategy.

You need to work up the information - turn it into knowledge
Think of competitive surveillance as a jigsaw puzzle with thousands of pieces. You've lost the box with the motif. Every piece corresponds to a piece of data about your competitor -- e.g. their product line, their prices, etc. Now, your assignment is to find out what the motif is -- that is, what your competitor intends to do. You start out with a little handful of interconnected pieces which you can make out.

This way, you can turn the data pieces into information. You continue like this until you have sufficient information. You can gradually begin to form an assessment of what the complete picture, even if you have only a few hundred of the thousands of pieces. With that, you obtain knowledge.

You need to communicate the knowledge
The distinction above between data (puzzle pieces), information (compositions of puzzle pieces) and knowledge (assessment of the whole picture) is crucial in competitive surveillance.

However, it still isn't enough and you should put as much energy into communicating this knowledge. The key point to remember is to make your presentation or report very action-oriented.

Your knowledge then becomes intelligence -- and intelligence will help you outsmart your rivals.

Not easy, but indispensable
True, this is not an easy job. Not unrealisable, just difficult. At the same time, it is an indispensable exercise if you don't want to be left behind with the feeling that your competitors are controlling the agenda on the market.

At LEC we help international companies undertake action-oriented market research and competitive surveillance so that management can take crucial strategic decisions.

If you'd like to know more about how we do this in practice, and how we may be able to help you, call us now for a no-obligation meeting at 0870 745 6899, email, or use the form.

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