Competitive Intelligence and Business Ethics Based on the article : Global Code of Ethics and Competitive Intelligence Purposes: an Ethical Perspective on Competitors Alessandro Comai. ESADE Business School, University Ramon Llul . SCIP Journal : Journal of competitive Intelligence and Management Ziv Rafalovich – July 2004

Agenda Approaches to CI and ethics Codes of ethics 4 Variables to evaluate ethics in CI. Model which combines Information collection and ethics.

Approaches to CI and ethics

Codes of ethics

4 Variables to evaluate ethics in CI.

Model which combines Information collection and ethics.

Goal Framework to help organizations decide which information collection techniques are ethically acceptable in a specific context. Discuss approaches to CI through which firms can embrace multinational code of ethics.

Framework to help organizations decide which information collection techniques are ethically acceptable in a specific context.

Discuss approaches to CI through which firms can embrace multinational code of ethics.

Competitive intelligence definition a systematic, legal and ethical process for the gathering and (insightful) analysis of information, and the dissemination of actionable intelligence to decision makers, that can affect your company’s plans, decisions and operations. (SCIP’s definition of CI)

a systematic, legal and ethical process for the gathering and (insightful) analysis of information, and the dissemination of actionable intelligence to decision makers, that can affect your company’s plans, decisions and operations.

(SCIP’s definition of CI)

Who are the stakeholders ? The traditional focus for business ethic was around the firm and its stakeholders (environment). Ethics in market research is focused on the relation between the researcher and the end customer. Competitors were usually excluded from the stakeholders group when coming to deal with ethics. CI is focused on competitors and competitive arena. When comparing CI to market research, the competitor is the main subject of the study. Hence, should be treated like the end-customer.

The traditional focus for business ethic was around the firm and its stakeholders (environment).

Ethics in market research is focused on the relation between the researcher and the end customer.

Competitors were usually excluded from the stakeholders group when coming to deal with ethics.

CI is focused on competitors and competitive arena. When comparing CI to market research, the competitor is the main subject of the study. Hence, should be treated like the end-customer.

Different Ethics to different stakeholders

Codes of ethics Flexible code General guideline. Open to interpretations Rigid or Regulatory code “ Dos and don’ts” Can be seen as contract between the company and the environment. Storytelling, Case study, Narrative approach Bring up awareness, Educational code Golden Rules “ I will not do anything that may now, or in the future, harm, or embarrass, the corporation” “ don’t’ do what you do not want others to do”. Question and Answer Approach Help an individual assessing a decision by answering a set of questions

Flexible code

General guideline. Open to interpretations

Rigid or Regulatory code

“ Dos and don’ts”

Can be seen as contract between the company and the environment.

Storytelling, Case study, Narrative approach

Bring up awareness, Educational code

Golden Rules

“ I will not do anything that may now, or in the future, harm, or embarrass, the corporation”

“ don’t’ do what you do not want others to do”.

Question and Answer Approach

Help an individual assessing a decision by answering a set of questions

SCIP Code of Ethics for CI Professionals To continually strive to increase the recognition and respect of the profession. To comply with all applicable laws, domestic and international. To accurately disclose all relevant information, including one's identity and organization, prior to all interviews. To fully respect all requests for confidentiality of information. To avoid conflicts of interest in fulfilling one's duties. To provide honest and realistic recommendations and conclusions in the execution of one's duties. To promote this code of ethics within one's company, with third-party contractors and within the entire profession. To faithfully adhere to and abide by one's company policies, objectives, and guidelines.

To continually strive to increase the recognition and respect of the profession.

To comply with all applicable laws, domestic and international.

To accurately disclose all relevant information, including one's identity and organization, prior to all interviews.

To fully respect all requests for confidentiality of information.

To avoid conflicts of interest in fulfilling one's duties.

To provide honest and realistic recommendations and conclusions in the execution of one's duties.

To promote this code of ethics within one's company, with third-party contractors and within the entire profession.

To faithfully adhere to and abide by one's company policies, objectives, and guidelines.

The framework Introduce four variables to filter Information collection techniques. The technique The Business context Culture and ethical principles Competitive Intelligence purposes

Introduce four variables to filter Information collection techniques.

The technique

The Business context

Culture and ethical principles

Competitive Intelligence purposes

Variable 1 : The Questionable Methods Collection techniques (Legal!!) Legitimate – respected, agreed either formally or informally by broader society Misrepresentation or covert intelligence – name of the investigating company is not fully disclosed. Improper influence and undue influence. Improper means or False purpose. -Unsolicited or accidental intelligence – (not really a group) There is a conflict between a technique’s effectiveness and ethical value. There is a conflict between the importance level of CI (tactic -> strategic)

Collection techniques (Legal!!)

Legitimate – respected, agreed either formally or informally by broader society

Misrepresentation or covert intelligence – name of the investigating company is not fully disclosed.

Improper influence and undue influence.

Improper means or False purpose.

-Unsolicited or accidental intelligence – (not really a group)

There is a conflict between a technique’s effectiveness and ethical value.

There is a conflict between the importance level of CI (tactic -> strategic)

Variable 2 : The business context Regulation and Rules Porter : “bad and good competitors” Information Accessibility and the Law 80-90% of competitive information is freely available and the remaining is not required. 80% is “white” information, 20% is “gray” and “black” information. What is public information? Provided by a competitor who has either chosen or is required to make this information public. Defined by Confidentiality and Accessibility

Regulation and Rules

Porter : “bad and good competitors”

Information Accessibility and the Law

80-90% of competitive information is freely available and the remaining is not required.

80% is “white” information, 20% is “gray” and “black” information.

What is public information?

Provided by a competitor who has either chosen or is required to make this information public.

Defined by Confidentiality and Accessibility

Public information (cont.) Non confidential Confidential Not Accessible Accessible Can’t be obtained by legal means The “INTRESTING” information : Confidential and available Internal Common Information. Usually less interesting Common knowledge

Geographical Context What is Legal in the destination country ? What is Legal in the motherland ? What is ethic in the destination country ? What would be the consequences of ethic/legal issue in any country ? IBM in South Korea – Korean director was accused with bribery which resulted in NASDAQ stock , press release and more .. Is the company a local company working abroad or a global company ?

What is Legal in the destination country ?

What is Legal in the motherland ?

What is ethic in the destination country ?

What would be the consequences of ethic/legal issue in any country ?

IBM in South Korea – Korean director was accused with bribery which resulted in NASDAQ stock , press release and more ..

Is the company a local company working abroad or a global company ?

Variable 3 : Culture and ethical principles External Environment Legal, Cultural or geographical , Family Corporate Most influence regarding CI approach. Code of ethics ,Rules, guidelines How to achieve moral excellence Resolve conflicts between individual and corporate Group Behavior Individual Age, sex , rural/urban, education, level in hirarchy

External Environment

Legal, Cultural or geographical , Family

Corporate

Most influence regarding CI approach.

Code of ethics ,Rules, guidelines

How to achieve moral excellence

Resolve conflicts between individual and corporate

Group Behavior

Individual

Age, sex , rural/urban, education, level in hirarchy

ethical principles - The four imperatives “ Ethic principles provide a common framework that individuals who hold differing normative positions can adopt when debating an issue”. Harmlessness You have the right to study the other’s environment but you have obligation to preserve it. Beneficence Intelligence can be use to build partnership. Autonomy The investigated element has the freedom of decision Justice Firm should use the same techniques independently of the object studied.

“ Ethic principles provide a common framework that individuals who hold differing normative positions can adopt when debating an issue”.

Harmlessness

You have the right to study the other’s environment but you have obligation to preserve it.

Beneficence

Intelligence can be use to build partnership.

Autonomy

The investigated element has the freedom of decision

Justice

Firm should use the same techniques independently of the object studied.

Variable 4 : CI purpose Neutral Intelligence Scanning the environment. Rival Intelligence Focus on competitors Collaboration Intelligence Such as due diligence activities Defensive Intelligence Forecasting threats, maintaining status quo, protecting from unethical/illegal activities

Neutral Intelligence

Scanning the environment.

Rival Intelligence

Focus on competitors

Collaboration Intelligence

Such as due diligence activities

Defensive Intelligence

Forecasting threats, maintaining status quo, protecting from unethical/illegal activities

The model

The Common mental spectrum