Professional Documents
Culture Documents
STRATEGIC INTELLIGENCE
This paper focuses on the relationship between monitor, interpret, and respond to environmental
Strategic Intelligence and strategy. The aim is changes. This is where SI, a systematic process
to provide readers with a definition of Strategic of collecting, analyzing and communicating
Intelligence (SI) and explain the role of intelligence actionable strategy-oriented business information,
in formulating and implementing strategy. can serve as input in strategic decision-making.
The role of Intelligence in strategy formulation is The paper begins with a discussion on strategy
a critical one, especially now, given the quickly and attempts to define for readers the concept of
changing business environment. As the pace Strategic Intelligence (SI). Strategic Intelligence
accelerates, it becomes more difficult for senior as a part of Strategy Development will then be
managers and decision-makers to adequately discussed followed by some concluding remarks.
2. Strategy
The concept of strategy has been around for as • Strategy as a means of establishing an
long as there have been organizations and wars. organization’s purpose in terms of its long-
Inevitably, there has been a huge amount of term objectives, action plans and priorities for
studies and writings on the subject. Today, there resource allocation; aligning short term action
are different ways of defining strategy and the and resource deployment to be congruent with
concept of strategy can be viewed from many longer term objectives.
angles. The aim of this chapter is not to provide
a clear-cut definition of strategy but to give • Strategy as a definition of a firm’s competitive
readers an overview of strategy which can serve as domain including defining the businesses a firm
a framework for studying the relationship between is in or intends to be in, segmentation, strategic
Strategic Intelligence, strategy formulation and positioning and how and where it is going to
implementation. compete.
• Strategy as a response to external opportunities
As mentioned earlier the concept of strategy can and threats and to internal strengths and
be viewed from different angles. Here are some, weaknesses; a means of achieving a long
but by no means all, dimensions that should be range competitive advantage, and a favorable
included in any unified definition of the concept competitive position and adapting to meet the
of strategy. These dimensions can provide an demands of a changing environment.
insight on how thinking strategically can benefit
our business. • Strategy as a logical system for differentiating
managerial tasks at the corporate, business
Some traditional views: and functional levels; defining an overall
mission and allocating resources with a sense
• Strategy as a coherent, unifying and integrative of strategic priorities.
pattern for decision- making, a blueprint for • Strategy as a definition of the economic and
the whole organization that indicates the non-economic contribution the firm intends to
organization’s future destination. make to its stakeholders.
Let’s now have a look at the basic elements of internal environment includes the corporation’s
strategic management – elements which attempt structure, culture and resources.
to provide insight into the strategy process (how),
strategy content (what) and strategy context Strategy formulation includes the corporate
(where, when, who and why): mission/vision, objectives, strategies and
policies.
Environmental scanning includes both external
and internal scanning. The external environment Strategy implementation is a process by which
consists of the task environment and the societal strategies and policies are put into action (e.g.
environment. The task environment (also referred programs, budgets and procedures).
to as industry) includes competitors, customers,
Evaluation and control: corporate activities
suppliers, interest groups etc. The societal
and performance results are monitored so that
environment includes more general forces such
actual performance can be compared with desired
as technological and political-legal forces. The
performance.
Competitive Intelligence (CI) is often defined as needed and timely intelligence input delivered in
knowledge and foreknowledge about the external actionable form.
operating environment of the organization. The
purpose of CI is to facilitate proactive decision-
making by producing the needed business The major difference between
information into actionable form and making it SI and CI is that SI actions
available at the right time. The orientation and focus strictly on supporting
utilization of CI is tactical and to some extent strategic decision-making by
strategic. The CI time horizon focuses on present monitoring aspects with strategic
events and, to some extent, on past and future significance.
events as well. Some CI processes are designed
to serve the strategic level, while some focus on Users of SI are primarily individuals involved
operative monitoring or both. in strategy development. Additionally, a SI
Strategic Intelligence is a type of Competitive time horizon is broad and the focus is on all
Intelligence produced for strategic purposes. significant events: past, present and future events
Customers of SI include individuals involved in (Figure 2). In short, Strategic Intelligence can
strategic decision-making. be defined as:
From the process perspective, Strategic Intelligence “A systematic and continuous process of producing
can be seen as a part of Competitive Intelligence needed intelligence of strategic value in an
as it is also a systematic and continuous process actionable form to facilitate long-term decision-
with a purpose to facilitate decision-making with making”.
Strategic
Level Strategic Intelligence
Levels
Competitive
Level Competitive Intelligence
Market Market
Level Intelligence
Events
Past Present Future
Figure 2. The Scope of Strategic Intelligence. Source: McGonagle & Vella, 1996
What are the roles of SI activity in strategic decision- An intelligence assessment must be made of the
making? Six basic roles can be identified: forces and factors that make up the company’s
competitive environment. The figure 3 below
1. Describing the competitive environment: shows a generic model of a strategic business
Intelligence analysis must define the current environment/competitive environment.
competitive arena in which the company operates.
Business
Environment General Trends
Industries
Supplier Customer
Own
Industries Industries/
Industry
Segments
Scope
Companies
Suppliers Competitors Customers
on
gi
Re
et
rk
Ma
Interest Groups
An important aspect in strategic development and Critical strategic themes should be based on a
in the nature of required SI is critical strategic company’s strategy, mission and vision statements.
themes (CST). Critical strategic themes have a major Every organization should be able to identify those
impact on the strategic business environment and themes that require monitoring and analysis so
the change therein. that the company retains its competitiveness and
improves its position in the marketplace.
“Moves and changes which are
Typically, a strategic theme covers a wide range
not observed cannot be reacted
of issues to be analyzed. An example of such
to”. SI plays an important role
a theme would be long-term changes in the
in controlling these moves and distribution logic due to the development of
changes. electronic channels. Industry consolidation is
Industries
Supplier Surprises Customer
Own
Industries Industries/
Industry
Segments
Scope
Price changes
New applications
Convergence
Companies Concentration
Suppliers Competitors Customers
ion
g
Re
Changes in value chains
et
rk
Ma
Interest Groups
New standars & legislation
Value Chain Dimension
In order to practice effective Strategic Intelligence • Designing and producing SI products that
(SI) able to meet the needs of strategic management serve the customers’ content needs and
and introduce intelligence of strategic value into communication needs. Here, “products” refer
the decision-making process, certain critical to highly interactive management briefings and
aspects should be considered. visual actionable intelligence information packs
as opposed to massive static reports.
• Appointing a strategic level process owner,
preferably the VP for Corporate Strategy, and • Building a network of Strategic Intelligence
a seasoned SI Manager enables integrating contributors, both internal and external.
the best available internal senior expertise In the future, building SI capability together with
into the SI process. The SI Manager should effective scenario planning will become more and
be equipped with in-depth understanding of more important especially when restructuring the
the battlefield and be respected as an expert traditional strategy processes to meet the needs of
in the organization’s business and markets. constantly changing business environments.
He/she should also participate in the strategy
process. When discussing the roles of SI in strategy
development and the relationship between SI
• Knowing and understanding the internal
activities and the company’s strategy, SI could
customers. SI customers are individuals involved
be described as a sonar, searching for underlying
in strategic planning.
opportunities and threats that cannot easily be
• Defining the SI priorities and properly observed (monitoring critical strategic themes)
communicating them (critical strategic themes, and a radar helping the company on its road
key players to be analyzed, early warning to the future, supplying intelligence about
themes). It is important that the critical turning points (promoting a change in direction,
strategic themes be clearly communicated to forecasting what is ahead, developing scenarios)
everyone who is expected to contribute input for the enterprise.
to strategic analysis.
For further information or assistance in any Competitive Intelligence-related matters, please contact the
GIA Member company closest to You, or refer to the GIA website at www.globalintelligence.com.