Shaping Business Strategy Through Competitive Intelligence ... · Business Strategy Through...

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This project is funded by the EU Shaping Business Strategy Through Competitive Intelligence Strategic Use of Intellectual Property Information

Transcript of Shaping Business Strategy Through Competitive Intelligence ... · Business Strategy Through...

This project is funded by the EU Shaping

Business Strategy

Through

Competitive Intelligence

Strategic Use of

Intellectual Property Information

Strategic Planning Process

Business Strategy Definition

This project is funded by the EU

• “A course of action including the specification of resources

required, to achieve a specific objective”

• Strategy is the means for achieving the business objectives.

• Plans a company uses to gain competitive advantage over

competitors in a market.

• An advantage that a firm has over its competitors, allows it to

generate greater sales or margins and/or retain more customers

than its competition.

External alignment

Internal alignment

Competitive position

Business Strategy

Formulation

Implementation

INTEGRATION

the match between the organization’s strategy and its industry structure IOT

centers on the relationship between an organization’s internal aspects and its strategy

RBV

2 Business Strategy

Michael Porter

Competitive Advantage

Competitive Scope

Cost Differentiation

Broad Target Cost Leadership Differentiation

Narrow Target Focus

Generic Strategy Options

Successful business strategy requires

awareness about the company’s external

environment, including its customers,

competitors, industry structure, competitive

forces, etc…

The Strategic Planning Process

Objectives

Environmental

Scan: External & Internal

Strategy Choice

Structuring

Implementing

Results

Fee

dbac

k

Strategy

Formulation

Strategy

Implementation

Strategy

Alternatives

The Strategic

Planning Process Goal / Objectives

Environmental

Scan

Strategy Choice

Structuring

Implementing

Results

Fee

dbac

k

Strategy

Formulation

Strategy

Implementation

Strategy

Alternatives

CI:IP

Products / Markets

Processes

Strategy Formulation Process Environmental Scan

External Environment

PEST: Macro Environment

•Political

•Economic

•Social

•Technology / RD

Industry Structure: Porter’s 5 Forces Model

SUPPLIER POWER

Supplier concentration

Importance of volume to supplier

Differentiation of inputs

Impact of inputs on cost or

differentiation

Switching costs of firms in the

industry

Presence of substitute inputs

Threat of forward integration

Cost relative to total purchases in

industry

BARRIERS

TO ENTRY

Absolute cost advantages

Proprietary learning curve

Access to inputs

Government policy

Economies of scale

Capital requirements

Brand identity

Switching costs

Access to distribution

Expected retaliation

Proprietary products

DEGREE OF RIVALRY

-Exit barriers

-Industry concentration

-Fixed costs/Value added

-Industry growth

-Intermittent overcapacity

-Product differences

-Switching costs

-Brand identity

-Diversity of rivals

-Corporate stakes

THREAT OF

SUBSTITUTES

-Switching costs

-Buyer inclination to

substitute

-Price-performance

trade-off of substitutes

BUYER POWER

Bargaining leverage

Buyer volume

Buyer information

Brand identity

Price sensitivity

Threat of backward integration

Product differentiation

Buyer concentration vs. industry

Substitutes available

Buyers' incentives

Traditional Competitor’s Analysis:

Sources of competitor data

Looking at World-Class Competitors

World-class competitors are

proving that the best way to

match your rivals' strengths is to,

well, copy them.

“BENCHMARKING”

Not only is it both legal and ethical, the

practice is virtually mandatory for any

company that hopes to be considered a

“world-class competitor”.

Benchmarking is:

The formal process of measuring, and comparing a

company's operations, products, and services

against those of top performers (both within and

outside that company's primary industry).

The aim of this process is to identify the leading

companies' secrets to success, and copy them.

Benchmarking as a management practice, has

been growing explosively as it directs a

company's focus outside its own walls, and is

aimed directly at the marketplace and the

competition

Source: Society for Competitive

Intelligence Professionals

The Competitive Intelligence Cycle

Planning

&

Direction

Collection

Analysis Dissemination

Feedback

“Competitive Intelligence is a systematic and

ethical program for gathering, analyzing, and

managing external information that can

affect your company's plans, decisions, and

operations”

Very Little Use

• Product purchasing

• Freedom of information act

• Focus groups

• Case studies

• Mail questionnaires

Sources of CI (by extent of use)

Competitive Intelligence Sources

High Use

• Trade journals

• External (on-line) databases

• External hard copy documents

• Employees

• Industry experts

• Trade organizations

Moderate Use

• Sales representatives

• Customers

• Internal documents

• Internal databases / CD-ROM

• Telephone interviews

Low Use

• Government records

• Direct observations

• Clipping services

• Security analysis

• Competitors (contact directly)

• Personal interviews

• Suppliers

2002 Society of Competitive Intelligence Professionals Based on the Society of Competitive Intelligence Professionals 1997 Salary Survey

Competitive Intelligence is a process which gives insight on the future direction of the market. This process involves stages from data to information to intelligence.

“Competitive Intelligence is a systematic and ethical program for gathering, analyzing, and managing external information that can affect your company's plans, decisions, and operations”

Competitive Analysis Benchmarking

State of Mind Catch up with Competitor Over take competition Reach Excellence

Methodology Measure Performances Compare costs Quantity Gaps

Understand Mechanisms Compare Processes Indentify Positive Solutions

Sphere of activity Direct Competitors Sector-based comparisons

Inter-sector-based comparisons competitors or not

Source of Information Sector-based analysis of competitors

Leader Companies in their sector

Fields of Application Enter field of Activity Organization / Product

One method / one Function

Difference Between Competitive Analysis and Benchmarking

The Strategic Planning Process

Objectives

Environmental

Scan: External & Internal

Strategy Choice

Structuring

Implementing

Results

Fee

dbac

k

Strategy

Formulation

Strategy

Implementation

Strategy

Alternatives

Strengths and Weaknesses:

RBV: Tangible & Intangible

Intangibles: R&D, IP, HR, Internal Processes, L&G

BSC: L&G, Internal Processes

Strategy Formulation Process

Environmental Scan: Internal Environment

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Intellectual Property Strategic Resources

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Analysis of Intellectual Property portfolios of

competitors may reveal a great deal about the

competitors’ strategies.

• Patents

• Utility models Innovation

• Trademarks Brand

• Industrial Designs Design

Comparative advantage Input costs

Less Relevant

Competitive advantage Innovation

More Important

Processes

Products Services

Innovation Process 1

• Market Need / Problem recognition

2 • Idea Generation

3

• R&D / Feasibility (Technical and Financial)

4 • Implementation

5 • Commercialization

Introduce Change to

Marketable Value Added

To introduce change to products, services, or

processes with added value to the market

through the management of knowledge,

sciences, and technology.

The Balanced Scorecard

Internal Business Processes

Learning and Growth

Customer

Financial

The Strategic

Planning Process Goal / Objectives

Environmental

Scan

Strategy Choice

Structuring

Implementing

Results

Fee

dbac

k

Strategy

Formulation

Strategy

Implementation

Strategy

Alternatives

CI:IP

Products / Markets

Processes

Thank You