Challenges in Defining CI

Brody (2008) discussed the term CI and investigated how CI is perceived. She argued that the lack of an agreed definition was inevitable as: “developing fields (as CI) struggle with variants in terminology and understanding.” Brody (2008) found that CI was mostly described as a process or product. The process aspect emphasises activities undertaken in regard to CI and the product aspect looks at the process outcomes, and tools, which is the choice of analyses, toolkits, and information systems that support the activities undertaken for CI. In contrast, Businessdictionary (2014) defines CI as the:

“Continuous process of monitoring a firm’s industry or market to identify (1) current and future competitors, (2) their current and announced activities, (3) how their actions will affect the firm, and (4) how to respond. It differs from industrial espionage in that it uses legal and ethical means to gather and sift the publicly available information.”

Businessdictionary (2014) emphasises the activities undertaken to analyse markets and the decision aspect, paying less attention to organisational perspectives on CI.

McGonagle and Vella (2012) differentiated between strategic, competitor, market and technical intelligence and structured CI into strategic and operational, organisational and technological, and competition related activities. All activities are interrelated and necessary in accomplishing CI tasks.

Gainor and Bouthillier (2014) emphasised the benefit of CI for decision making and the need to measure CI performance in regard to CI process and performance in terms of resulting decisions. This PhD study sees that both, the CI process in firms and performance are interlinked, because CI processes result in activities that lead to a specific performance. For the CI process these activities are on the one hand conducting analyses that are communicated for decision making and the analyses are conducted in a specific way that is shaped from firms’ organisations.

3.2.1 Key Perspectives on Scope of CI Activities

Prior research has shown different categorisations of CI activities, notably, some fundamental conceptualisation of the nature of the CI process, which sets out critical actions that are part of the CI process (Choo and Bontis 2002; Derlei and Altun 2013), the module perspective, which identifies key CI tasks or elements (Prescott 2003;

Dishman and Calof 2008); and the key intelligence topics approach (Herring 1999).

Each approach is briefly discussed.

The CI process – as any other process – consists of input, transformation, and output.

The output serves as input for the next stage until a goal is reached (Businessdictionary 2010a). Choo and Bontis (2002) identified knowledge creation, transfer and utilisation organisational process within their framework for strategic knowledge management of intellectual capital. The CI process has therefore organisational and knowledge

elements, as it deals with the transformation of data about competition into actions of the firm. Specific topics relevant for the CI content are innovation, exploitation and exploration. Dereli and Altun (2013) identified a technological innovation process containing a discovery (‘invention’), commercialisation (‘innovation’), and imitation by competitors, focussing on the competitive market. Aspara, Tikkanen, Pontiskoski and Jarvensivu (2011) suggested an exploitation and exploration concept, analysing internal data for learning purposes (exploitation), and external data for product development purposes (exploration), which relates to the CI process. They stated:

“Exploitation refers to the use, refinement, and extension of a firm’s current knowledge, resources, and capabilities, while exploration refers to the firm’s search for, discovery of, and experimentation with new alternatives.”

Aspara et al. (2011) sought to combine innovation with the CI process when stating:

“Markets and customers and market actors’ knowledge of and bonds to the firm – as viewed in combination with … technologies, processes, and products.”

Overall, the CI process concentrates on activities relevant to improve competition.

What the above discussion of the nature of CI activities highlight is how CI is linked, on the one hand, to strategic knowledge management, to the exploitation of market actors’

knowledge but it is also linked, on the other hand, to innovative processes. Davenport (1994) identified the knowledge management process that captures, develops, shares and effectively uses organisational knowledge. The CI process is conducted in firms and therefore related with knowledge management (see Section 3.4). Furthermore,

Davenport (1994) pointed at organisational knowledge and effectiveness, which this PhD study seeks to understand how the organisational context supports the CI process.

Among similar approaches to the CI module or phases view (Bouthilier and Jin 2003;

Prescott 2003; Fuld 1995), two are explained. Prescott (2003) identified the following phases or modules of a CI process: planning and focus, collection, analysis,

communication, and decision. Dishman and Calof (2008) took the same view but changed one step: intelligence process and structure, collection, analysis,

communication, and decision. They claimed that organisational awareness and culture supports the whole process. Both approaches have in common the identification of a distinct sequence of steps of CI process activities. McGonagle and Vella (2012) recently outlined a similar breakdown of sequenced CI activities, such as identifying, collecting and analysing data concerned with competition. When describing a CI process, they saw it as firstly, an activity to identify information needs from decision makers about the competition, secondly the collection of relevant data, thirdly, an analysis of the data and fourthly, communication of the data analysis outcomes to decision makers.

What the CI module view offers that was perhaps not addressed in the strategic

knowledge management orientation of Choo and Bontis (2002), is the focus on data that emerges from the market context of the firm that relates to competition (Jaworski and Wee 1992). The CI module view can be seen as an application of information

management, which is concerned with information processes (Heinrich 2005), where information management covers all issues relevant for the firm, such as IT, human resources, finances, controlling, and production.

Herring (1999) recommended a key intelligence topics view. His approach first identified key intelligence needs of a firm by going through a so called ‘management-needs identification process’, which emerged in dialogue with key decision makers and was an important initial CI activity. This focus on intelligence topics is also addressed, in part, in the module view which included this aspect of setting out the intelligence priorities in the ‘planning and focus’ task (see Prescott 2003); which deals with identifying specific intelligence requirements (Krizan 1999; Weiss 2002). An echo of this thinking is evident in the work of McIntosh et al. (2011), who noted that it is crucial to focus on ‘what problems to solve’ when designing systems. Similarly, Sangar and Iahad (2013) saw it as a critical success factor to identify key intelligence topics for designing a business intelligence system. Deltl (2013) saw the identification of key intelligence topics as a basic facilitator of CI.

“Adhering to a definition phase and key Intelligence topics as well as key Intelligence questions sharpens our focus and prevents an information overload.”

When describing a CI process, it has been noted above that McGonagle and Vella (2012) saw it as first activity to identify information needs from decision makers. Thus, this research sees it as important to identify intelligence needs in accordance with past thinking when assessing firms’ CI activities.