Understanding the CompetitionJanuary, 2008

Michael Danke713 940 1063

Page 2

Quick Survey

Does IBM make PCs?- Yes- No

Does the word “Celiac” mean anything to you?- Yes- No

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Bio

University of Houston – BBA – Marketing Andersen Consulting Grant Thornton (Consulting) Neste Trifinery Petroleum Services University of Chicago – MBA Continental Airlines IBM

- Business Innovation Services e-business Strategy and Design Strategic Intelligence Institute for Business Value

- Business Consulting Services Strategy and Change (Solutions)

- Organizational Design and Effectiveness- Operational Strategy

BCS Strategy – Staff

- Global Business Services GBS Strategy – Staff

- IBM HQ Market Intelligence – Competitive Intelligence

IBM Stock Price date of hire $117.92 IBM Stock Price 1/9/08 $98.31 Surviving the dot-com crash with a job at

a technology company – priceless.

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Here’s how one company’s marketing function is organized…

All the Market Intelligence groups looks at the evolving market space, just from different perspectives.

SALES MARKETING

Market Data Services and

Analytics

Opportunity Analysis

Market Research

Market Intelligence Practices

Competitive Intelligence

Industry, Service Line

and Geography

Market Intelligence

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How can Competitive Intelligence be useful?

“Most of his competitors, but especially the Eastern-bloc teams, are known to study tapes of Greg Louganis, who has dominated the sport for the last ten years. He was just sixteen when he won a silver medal in Montreal in 1976 and became the One to Watch. Since then, he has been the One to Beat, and to that end, they fret over the tapes, freeze frame his dives and analyze the parts. But they cannot come up with the impossible sums that judges award Greg Louganis.

“The Soviets and the Chinese seem to have developed programs that teach Louganis techniques to every one of their divers,” says Louganis’s coach, Ron O’Brien. “[The communist countries] have developed an acrobatic, a mechanical copy of Greg. They haven’t been successful at teaching a rhythmic, dancelike quality.”

The Sports Writing Handbook, Chapter 6, page 92 (Fensch)

Greg Louganis diving at the 1984 Olympic Games in Los Angeles.© Focus on Sport/Getty Images

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Key Intelligence topics involve areas at the core of business – or at least in areas where key decisions are being made

Dif

ficu

lty

of

Qu

esti

on

Easy

Ridiculous

Company-wide Small part of business

Reported Financials

Strategy statements

News in the press or on

the web

Court filings

Public filings (patents)

Price of an acquisition

A list of owned real estate, including

value

Executive personal contact information

Internal win/loss reviews

Terms of Contracts/

Rates

Internal business processes (utilization

calculation)

Apples to apples comparisons when companies are not organized similarly

List of every client, type of work done,

project revenue

How are they going to decide which

direction to pursue in a very narrow market

Level of specificity

Moving up and to the right usually

involves increasing

amount of time and cost

The time and cost of gathering information does not necessarily

equate to strategic

usefulness

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Most of the job is a pretty straightforward exercise, but…

Taking shortcuts in collecting information could send you to the dark side.

HP/WSJ example Business conduct

guidelines SCIP guidelines

Questions are things like “What is their strategy?” “Who are their customers?” “What are they selling”

Usual deliverables include newsletters, emailed answers to questions, competitor overviews and competitor deep dives (on a topic)

People aren’t real interested in what happened more than 91 days ago – they would rather have you tell them what’s coming next…

…and that’s where analysis comes in

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How to try and build a business case for a golf tournament

Assignment – try to understand where upcoming asset investment or big deals might be made.

“I know this will be tough, so think outside the box.”

I know they meet with groups of clients Maybe I could go where they are and

hang out at the hotel/bar/Starbucks and observe how careless they might be with business information. (Many execs feel free to make loud cell phone calls or work on a plane, for example)- Annual meeting is over and - Executives were not based in an office, but- They were holding a golf tournament…

“You want to go where?

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Business Applications

IT Infrastructure

Application Infrastructure

Business Operations

Business Strategy

Client Core Competency

R&DClient Core Competency

OperationsClient Support Activity

Finance FunctionClient Support Activity

Human ResourcesClient Support Activity

Marketing

1940sArthur AndersenAudit and Tax

1950sArthur

AndersenAdministrative

Services

Single Process Automation

1950sArthur

AndersenAdministrative

Services

Single Process Automation

1950sArthur Andersen

Administrative Services

Multiple Process Automation

1970sArthur AndersenAdministrative

Services

Multiple Process AutomationBack Office

1980sArthur Andersen

Management Information ConsultingMRP/ERP

Client Server

1990sAndersen Consulting

Business Integration

1990sAndersen Consulting

Industry Vertical Applications

2000sAccenture

Outsourcing

2000sAccenture

Outsourcing

2000sAccenture

Industry VerticalOutsourcing

2000sAccenture

Client Core CompetencyOutsourcing

2000sAccenture

Outsourcing

What’s Left?

What’s Left?

Earnings review: How Accenture grows

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23 January 2008(as Michael predicted) Accenture to Acquire Maxamine and Memetrics, Expanding Digital Marketing Sciences Services

NEW YORK; Jan. 23, 2008 – Accenture (NYSE:ACN) has acquired Memetrics Holdings Pty Limited and has agreed to acquire the business of Maxamine Inc., expanding its digital marketing sciences services capabilities.  Memetrics and Maxamine are privately held companies that provide testing and optimization services to help companies improve the marketing effectiveness and financial returns from their websites and other digital marketing investments.  Terms of the agreements were not disclosed.

Maxamine, founded in 1997, scans websites to identify implementation problems which undermine online marketing performance.  Its services provide guidance to help clients improve website optimization, enhance customer experience, and decrease privacy-related and other risks. 

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What do you have for breakfast?

We need to reduce our box size to reduce

our costs!

Operations – Brand – Category – Market Intelligence

We don’t want to look expensive

for our size

It would increase the amount of

product that will fit on the shelf

What about the trend toward

green?

“Reducing our package size by 10% lessens our yearly impact upon the

earth by saving over 700,000 gal. of water,

500,000 KWh of energy and 75 tons of paperboard.”

RESULT: The “EnviroBoxTM”

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If you understand the business drivers, you can actually draw out a lot of information

Manufacturing throughput Estimates of cycle times Manufacturing efficiency in

terms of energy and water consumption

Rough size and capabilities of suppliers needed

Potential impact of their promotions (when combined with scanner data)

Rough idea of profitability (when combined with commodity costs)

How many boxes of cereal do they sell?Number Unit Notes

2.500 Ounces Weight of Box2.778 Ounces Weight of Box before reduction0.278 Ounces Weight savings per box

75 Tons Total Paperboard Savings2,400,000 Ounces Total Paperboard Savings8,640,000 Boxes Cereal Sold Per Year

How much cereal is that?8,640,000 Boxes Cereal Sold Per Year

10.6 Ounces Cereal per box5,724,000 Pounds Cereal

How much Revenue is that?8,640,000 Boxes Cereal Sold Per Year

3.99$ Dollars Retail Price34,473,600.00$ Dollars Revenue