Business Intelligence Processes

Innovation and ‘learning organisation” (& 2)

Differentiate.

A company is active in one or more market segments where it offers its products and / or services. This also interacts with other actors present in the same segment, some of them competitors.

A simple scheme used to summarize the different positions is as follows:Terreno competencia en

In one area the company is in a hyper competitive environment. It has the same objectives as its competitors and attacks a market segment with the same offer. If a large part of the activities are in the area, the company is in a particularly vulnerable position in the short term.

In zone 2 the danger is that in the medium term the company slide slowly to zone 1, with competitors starting to be interested by their customers, when they initially were absent.

In zone 3 proposes an offer that may be complementary to those of other players competing in this market. This can foster partnerships to strengthen mutual positions.

Finally, in the fourth, the company is in a more comfortable situation, with no competitors in a segment where it works alone. This is obviously an ideal situation.

Getting the information: Intelligence

The information should enable the company, first of all to understand in which of the above field stands, and then implement the necessary measures to avoid falling into zone 1 or approaching closer to Zone 4.Intelligence organisations en

In an environment of accelerated change such as the present, this information is constantly changing; therefore intelligence should provide continuous economic and strategic information.

Having external sensors and managing the information flow. Thus, from the analysis of weak signals generated and by confrontation with internal experts will be possible to generate and maintain a competitive advantage.

The processes of Business Intelligence

Business Intelligence (BI ) can be defined as the process of analyzing large volumes of data potentially useful in business generally stored in large databases called data warehouses , identify trends and patterns hidden track business results and help in making better decisions. In short, converting data into information to be used . This information is part of the process of producing knowledge, as shown in the figure:Datos info kn en

It is a strategic management tool that can support managers to make strategic and day to day decisions. It is therefore, a system to support decision making.

Most of the tools available in the market today come with special abilities that help users generate or run their own queries and reports in relation to your needs.

Market Intelligence is the relevant information relating to the company and its market segments. Specifically analyzes for the determination of market trends, indicators of opportunity, penetration strategy in launching or developing products and services in selected segments.

Business intelligence is used to support the strategy and decision making and includes data extraction, transformation and loading of a processor, a data warehouse and a number of reporting tools.

Activities of “Strategic intelligence”

We saw the first “post” part 1, as economic intelligence is composed of a number of activities closely linked with each other. We find many different denominations, including in many cases the term “surveillance “names lend themselves to confusion.

We call all these activities of BI as ‘economic intelligence‘ and ‘strategic intelligence (SI)’ See diagram:     Inteligencia económica y vigilia en

If economic intelligence operates on a macroeconomic level, the strategic intelligence allows preparing decisions that jeopardize the future of the company. Works based on correlations made ​​between the information obtained from technological intelligence, market, competition, regulatory, legislative, etc.

For each type, we need to design and activate a battery of sensors. At all times it will be necessary to target the sources chosen depending on the type of information and to make sure that is secure and reliable. Coordination is important to avoid the risk of unforeseen changes in the environment. A number of companies have been pledged his future or just disappeared because not integrated their information sources according to their needs. There are many examples.

The consequence is becoming obsolete, out of the market segment, or conducted to a field of hyper competitive low prices.
The various dimensions of intelligence will help to position the company in the changing market environment and built an innovation strategy.

Around Social Intelligence, the company determines the convergence and consistency of its activities with social issues and values ​​of the environment. Beyond its image can assess the degree of openness or resistance of society to innovations that are proposed.

With Market intelligence can analyze the relations of power or influence in the entire supply chain, including suppliers, competitors, customers, end users, new entrants etc. The company can make a map of opportunities, save time and avoid reinvent the wheel. Also, build the “marketing mix” in size and position according to the most appropriate value proposition. Market intelligence can have two main approaches, the commercial focuses on “their” own supply chain, customers and suppliers, and competition, which focuses more on the analysis of changes in competitors, barriers of markets or segments, potential new entrants, etc.

Around Technological Intelligence the company tries to follow the evolution of knowledge and technologies, especially those that may be related to their current or future activity. It has some defensive and offensive approach. On the one hand, to preserve their innovations and technology, which is the heart of their differentiation, could become obsolete. Moreover, should identify areas where they develop technologies and decide whether to acquire or work in new additions that will ensure new concepts and innovations for new competitive advantages.

No intelligence can be addressed separately from the others. Market Intelligence feeds from information that come not only from the social intelligence, but also from knowledge which is the result of technological intelligence and internal technicians who have studied technologies and products used by competitors.IE activities org en

UNE 166006 includes systematic observation and search for signs of change and developments aimed at capturing information, selection and analysis, dissemination and communication to convert it into knowledge that allows decision and monitor the operation of its results.

The launch begins with the decomposition of the intelligence activities in very specific actions, search, capture, processing, storage and processing of data and information systematically, necessary reports for different users. This prioritized with different sequences and time intervals. That is, a structured process in the company to determine “Who is responsible for information and why “. See diagram:

Overconfidence in the information available may impulse the lack of critical confrontation. Moreover, if a company can participate in public or shared observatory of intelligence and surveillance, will allow reducing costs, which is useful for SMEs.

Finally, the entire company should be engaged in the process of intelligence, like all should be in the innovation process.

The network will serve the whole and not just certain departments and will address and facilitate interconnections and links between:

  • The people on the ground, commercial , technical – commercial , etc. . thanks to its special reports and comments
  • The customers directly.
  • Written and published information , databases , contests , offers, publications , magazines, websites, etc.
  • Specialists in daily contact with sources linked or related areas of surveillance : Buyers are responsible for HR, etc.
  • Managers of subsidiaries, associated companies.
  • Professional associations, government, etc.
  • Teams and workgroups.

The process will require a responsible leader, often arising from R & D technicians, although sometimes it can be a member of the management team or directly the general manager in SMEs. The real flexibility comes from the time when this leader, who in turn is responsible for listening to the “voice of the customer”, will really ensure that all interested are in direct contact and confront market realities.
Other relevant and most important thing is to complement and align the activities of “intelligence”, with the “capitalization of internal knowledge.”  This may be matter for another post.

Practical case of Strategic Intelligence

The company was in 2009 a major global operator in the automotive segment, with turnover in excess of € 4,000 million and levels of profitability among the highest.

Involved in the design, development, production and marketing of components for certain types of vehicles. Its sales also fall in the consumer sector, which accounts for 66% of group revenue, while the remaining 33% comes from the industrial segment.

In 2009 began a structured approach to implement strategic intelligence, which at the time created an “antenna” to the external environment related to the company, to observe changes and identify trends of all kinds potentially interesting.

The main objectives were identified:

  • Technical analysis on the identification and evaluation of technological advances that may be critical to the competitive position of the company.
  • Monitoring the activities of competitors or technological shortcomings discovered potential threats and areas of competitive advantage in either front technological or market positioning.
  • Monitoring the technological advancement of their field and related technologies to identify potential useful innovations.
  • Tracking macroeconomic trends and scenario building regulations to identify opportunities and threats in a timely manner.
  • Also apply intelligence in innovation internal processes, which are equally important for the company.

In the practice this meant putting under “antenna” of the company a wide range of information such as:

  • Competitors
  • Suppliers
  • Distributors
  • Universities and research institutions, private and public
  • Trends and market developments , such as product development activities of automotive companies
  • Patent Databases
  • Media industry specific
  • Media technical / scientific
  • Homepages competitor’s
  • The press releases of the activities of the automobile industry and competition.

The following Table 1 summarizes the deliveries or ‘outputs’  from strategic intelligence process for various internal clients, having used “push” and “pull” methods to determine them.

Table 1.- Diagram of the Strategic intelligence (SI) process outputs

Type PUSH outputsType PULL outputs
Intranet pages with statistical information – Ranked by competitor and business unit / item – Custom Alert SystemPeriodic statistical reports – Statistics of main technical issues / Patents – Statistics of product launches – Networks ‘Open Innovation’ competitors – Statistics of investments in R & D – Statistics of investments in capacity / plant / production – Data / general market trends – Reports / market segmentsPeriodic reviews of patents, patents on new content, applications. (For competitors and others) and for each business unit Reports technical analysis of product competition (external service)Customized topic reports, only requested for interested parts (news, patents, statistics, special studies … etc)

It is necessary also complement the process of capturing external data with the opinions of  internal experts, especially from R & D and relevant areas of expertise. This is complemented and enriched by:

  • Interaction with the area of ​​Intellectual Property (identification of potential patent infringement , etc.)
  • Interaction with Commercial (benchmarking and testing products in the media , recognizing market trends)
  • Interaction with Purchasing /Supplying areas, (commodity market trends, identifying new suppliers)
  • Interaction with strategic planning (projects and new investments, joint ventures and other strategic initiatives)
  • Interaction with operations (production , logistics, testing , quality, health, safety and environment)
  • Interaction with support processes (human resources, finance, IT, etc.).

What the process still needs, is to improve intelligence about “adjacent” technologies that could be useful for the innovation process. Tracking adjacent technologies is not easy, because they can be dispersed widely in many areas and not knowing exactly the possible future impact.

Author

Francesc Guell is the owner of this site. He was CEO and director of international companies in specialty chemicals and pharmaceuticals. The last 12 years was associated with international consulting groups, providing advice and support to businesses on topics such as innovation and agile innovation processes, operational excellence, knowledge management, change management, strategy and integrated business management. Currently creates and presents courses and workshops on these topics. He graduated as a chemical engineer, postgraduate from ESADE Business School in Business Administration and Master in Knowledge Management. He participated in numerous programs, seminars and ESADE, IESE, EADA, APD and MCE (Management Centre Europe). He is author of articles, presentations and courses on innovation in strategic management, integrated business models, knowledge management, performance measurement, change management and excellence in business processes. See more in: Professional Profile