The State of Competitive Intelligence within. New Zealand Private and Public Sector Organisations, страница 7

It is without a doubt that there is a wealth of literature covering competitive intelligence and the above relating factors, however, much of the current competitive intelligence literature is written by Americans or overseas authors, with very little related to the New Zealand environment.  This has been highlighted by Brent Hawkins, an Auckland University of Technology lecturer, who completed a search of New Zealand academic databases using the keywords ‘competitive intelligence’.  His search only identified six studies since 1991 (Burmester, 1991; Kearns 1997; Trengrove & Vrvyenhoek, 1997; Fourie, 1998; Ng 1999, and Pidgeon, 1999, as cited in Hawkins, 2004).  Of these, it was only the Trengrove & Vrvyenhoek and Fourie studies that focused on competitive intelligence.  While both these studies have merit, Trengrove & Vrvyenhoek study (1997) provides a more in-depth analysis on the competitive intelligence topic and will be used as the basis for the remainder of this report.   

The theory of competitive intelligence

Often competitive intelligence is thought of as merely ‘keeping an eye on our competitors.  Unfortunately this approach is very limited and could lead a company/organisation to establish a very narrow view of the competition and environmental factors (Murphy, 2005, pg 4).  For example, in the mid-1980’s IBM found its personal computer market-share becoming eroded by Compaq’s low cost, but equally good quality machines.  Both companies started to produce more sophisticated computers and focused on each other’s moves rather than their customer preferences.  By the end of the 1980’s, other rivals (such as Dell) capitalised on the technology gains made by IBM and Compaq by introducing lower pricing and more user-friendly computers which satisfied customer demands (Kim and Mauborgne, 1997).  

Another example of this narrow view was when Callaway seized a market opportunity by establishing a new marketing concept of introducing a bigger head golf driver called the ‘Big Bertha’.  

Callaway had noticed that there was little that distinguished products and that golfers seem to have a desire for a bigger head driver to improve their game.  Other competitors remained focused on the current environment, i.e. status-quo of golf club design and production.  

Competitive intelligence is not just limited to researching and benchmarking other companies in order to outperform them (Murphy, 2005, pg 6).  Competitive intelligence incorporates all of the environmental elements that could damage or enhance a company’s revenue and profits.

To understand companies’/organisations’ attitudes towards competitive intelligence, Rouach and Santi (2001) created five attitude categories on how companies conducted and viewed competitive intelligence.  These categories were based on a study of US and European companies completed in 2001.  The five categories (Sleepers, Reactive, Active, Assault and Warrior) are:

ƒ Sleepers

Applies to companies who have no deliberate competitive intelligence activity and are managed by passive managers who believe they have all the information to operate a business.  They are classed as a ‘closed shop’ environment (i.e. do not collaborate or gain market insights outside their company). 

ƒ Reactive

Applies to companies that have no competitive intelligence operations, however, these companies will undertake some ad hoc competitive intelligence exercises when challenged for market share by a competitor.  Rouach and Santi found that most French small – and mediumsized enterprises (SMEs) were in this category (2001). 

ƒ Active

Applies to companies who have a permanent competitive intelligence function and who are active in anticipating their opportunities and threats rather than reacting to them.  Under this category, these companies would have modest resources undertaking competitive intelligence activities, but would have no developed structure to handle the information obtained.  Interestingly, Rouach and Santi (2001) found that most large French companies and American SMEs were within this category and their study suggests that some large French companies could suffer a competitive disadvantage due to the higher levels of awareness of competitive intelligence from the smaller America rivals.