1. Competitive Intelligence Magazine Volume 5 • Number 4 • JULY–AUGUST 20026
At a meeting of the St. Louis Chapter of the Society of
Competitive Intelligence Professionals, a panel discussion ex-
plored how corporate culture impacts action and how under-
standing culture gives insight into likely actions. Participating
in the panel were Jan P. Herring of Herring & Associates;
Regina Klein, manager of R&D strategy for Pharmacia; and
Michael Harris, professor of management in the College of
Business Administration, University of Missouri-St. Louis.
The moderator was Alison Bourey, chapter co-coordinator and
market intelligence manager for ABM Management Company.
Jan Herring:
The proposition that Alison put to us essentially was, “Can we
as professionals, either as an individual or as an intelligence
unit, use the assessment of a competitor’s corporate culture to
better understand what a competitor is likely to do in some
future context?” Yes, we can. But doing it well requires three
key intelligence capabilities:
Corporate Culture
as a Tool for
Anticipating
the Competition
Jan P. Herring, HERRING & ASSOCIATES
Regina D. Klein, PHARMACIA
Michael Harris, UNIVERSITY OF MISSOURI-ST. LOUIS
Alison T. Bourey, EXPRESS-SCRIPTS (MODERATOR)
A good competitive analysis includes both
what competitors should do to succeed, and
what they are likely to do. A significant
component of understanding what they are
likely to do is knowing the style of the
leaders and the culture of the corporation.
1.Experienced and professional interdisciplinary analysis.
2.Professional and skilled human source collection to gather
the information.
3.A credible track record with your own management to get
them to accept it and use it.
All of these components must be present. If you miss one
of the three, your effort is going to be futile.
Regina D. Klein:
My themes include a working definition of corporate culture
(see Table 1), how to assess your competitor’s culture, and a
few projects that I worked on at Monsanto and what we
learned. The Conference Board, in A Manager’s Guide to
Corporate Culture (Research Report #926, 1989), defined corpo-
rate culture two ways:
• Basic assumptions that underlie shared meanings and
values (narrow view).

2. Volume 5 • Number 4 • JULY–AUGUST 2002 Competitive Intelligence Magazine 7
• Common values and expectations as well as supportive
stories, legends, rituals and ceremonies (broad view)
Very close to the Conference Board’s definition is my
favorite definition of corporate culture, from Liam Fahey’s
1999 book Competitors:
“Organization culture can be broadly defined as the collectivity of
norms and behaviors and their underlying explicit or implicit ration-
ales such as values, beliefs and principles.”
These are different ways to look at a competitor’s culture.
Track the competitor’s decisions over time. (You can tell from
their actions what their decisions were if they aren’t explicitly
stated in public documents.) Do they support one point of
view or another? Look at what they’ve done as opposed to what
they’ve said. There are often major discontinuities.
Public statements and other open source documents can
provide a rich source of information on a company’s culture.
While the amount of information you can find depends on the
industry and the company, some are sufficiently explicit to let
you compare public statements to actions.
Still, the most important information source is human
intelligence. It goes beyond what’s publicly available to the
people within the company, the industry, and those close to
the decision-makers, and helps you determine how your target
company is thinking.
Joint ventures and alliances
In working on joint ventures and alliances I have had a team of
people look at an industry and decide who would be the best
partner for specific deals that we wanted to do. Who would be
fun to play with and who would like to play with us? As any
good CI manager would do, we spent an enormous amount of
time looking at all the key players— their strengths, resources
and capabilities in manufacturing, cost of goods, patents, areas
of research, etc. But the keys to putting together a successful
alliance, as we heard Jan say, are the non-capability or non-
business issues.
Yes, we had lawyers and business development telling us
what would be good, but the CI team had to say: “Well, really,
this is the way this target company operates. This is the
personality of the folks who will be across the table from us in
a particular negotiation.” We did some remote personality
profiling and evaluation of company culture and ranked our
prospects by who would be the best fit. Often the deciding
factor was cultural fit.
New industry analysis
CI analysts are frequently asked to do industry analyses or
competitive maps. My team spent half a year identifying
leaders in a particular new industry and completing an exhaus-
tive analysis of the key competitors. In this example, we were
entering a product/technology/market area we did not know.
We did strategy maps and SWOT analysis (strengths/weak-
ness/opportunities/threats). We focused on the important pre-
diction of how each company would enter the market and
what they might do. What was their competitive response to
our entry likely to be?
1. Integration. How integrated is the culture within
the company (which takes a good bit of human
intelligence to ascertain) and how integrated is the
culture communicated externally to audiences
(that’s a little easier to do). Is the message
consistent or all over the place?
2. Embeddedness. How uniform is the culture? As
Jan mentioned, large companies serve in many
geographical areas and have many operating
divisions. How persistent or embedded is the
culture across those geographies and entities?
3. Alignment. How is the culture aligned with the
organization’s infrastructure? Is there one stated
corporate value the company fails to support with
compensation and rewards? Ask if the culture is
aligned with the direction of industry change. Does
your competitor have one set of values, while the
industry as a whole is changing in a totally different
direction? This provides an insight for the future of
that competitor!
4. Durability. Is the culture durable and consistent
over time? When you look back at the competitor’s
corporate culture over the last 20 years, has the
culture evolved, is it fairly consistently the same, or
is it up for grabs?
5. Adaptability. Do the culture and norms of the
organization support adapting to a changing
environment? This point meshes with alignment, and
asks how well a competitor’s corporate culture
internally adapts to the environment. Is the culture
so cast in stone and so immovable that adaptation
to business changes will be very slow, or is it very
flexible and able to change quickly?
In his book, Liam
Fahey describes the
five attributes to
think about when
you look at a
competitor’s culture:

3. Competitive Intelligence Magazine Volume 5 • Number 4 • JULY–AUGUST 20028
While we didn’t explicitly set out to do a “corporate
culture” analysis, when you’re looking at strengths, weaknesses,
threats, and opportunities, much of what you learn is based on
your assessment of the company’s culture. And in this case, the
culture was built in layers.
As a technology company, we always start with under-
standing the competitor’s approach to R&D, then marketing,
legal, and how they like to structure their deals. While we
didn’t have a matrix or rigorous structure for looking at culture
per se, we had a very rigorous matrix in place for looking at
strategy. Culture analysis played a big role in the decisions and
the predictions that we made.
Early warning
One of my favorite activities, and what often keeps CI
managers up at night, is doing early warning as part of key
intelligence topics. You must always have those early warning
topics going. Here is my one formula in this discussion:
I + C= T
The sum of the Intent + the sum of the
Capabilities = the sum of the Threat.
So, how can you determine what a company’s intent is?
There are clues in corporate culture as led by key decision-
makers. Culture is a key driver when you’ve got multiple
competitors with essentially the same capabilities. What is
their intent—both individual and collective—likely to be?
What are they going to do with that capability? What is their
filter? What are their thresholds for being goaded into action?
If we come with product X having a specific set of attributes
because our company believes in conducting multiple clinical
trials, is everyone else going to share our worldview or are they
just going to put their product on the market well before we
do?
What did we learn from doing this work? First, under-
standing your competitor’s culture and reflecting on your own
enhances the quality of your analyses and your projections.
Second, to develop an accurate culture analysis you must
diligently avoid projecting your company’s culture onto the
competitor. It’s extremely hard to step out of your own culture
and put yourself into the thoughts and biases of the competi-
tor. The CI manager may be able to do this, but your top
executives may not. It’s a challenge to say to your management,
“Well, they’re really not likely to do that, and here are the
reasons why we think so.” Even if you can get your CI analyst
to think consistently outside of your own corporate culture,
you’ve got many other people to convince, and I think that’s
probably my biggest discovery.
The last learning point is developing the opportunity to
help your senior management look at what your own company
culture is, especially focussing on how it actually works as
opposed to what senior managers think it does. Is your own
company culture supporting your competitive advantage? Is
your culture consistently aligned with your company’s values,
aspirations and goals? Sometimes there’s a little cognitive
dissonance there. As you put your competitive analysis for-
ward, you can work in a comparison chart or strategy map
placing your own company in the constellation of the competi-
tion and use this as an opening to create a conversation with
your management.
Understanding your
competitor’s culture
and reflecting on
your own enhances
the quality of your
analyses and your
projections.
Jan Herring:
Assessing a competitor’s business or corporate culture is a
difficult task. But to understand how that culture affects a
given decision or action is an order of a magnitude even more
difficult. In addition, all this assumes that you know who the
decision-makers are and how they are affected by that culture.
I’m somewhat skeptical about our current ability to do this.
But with that caveat, let me say how I would approach it and
give you several examples in which I used culture analysis to
gain an insight into a competitor’s intentions.
Examples of gaining competitor insight
In one situation we were analyzing a particularly aggressive
competitor. The CEO, who had been there for some time,
lived by one statement: “We will not give up one single point of
market share, not one single percent of market share.” All sales
staff and district managers knew they would lose their job if
they lost a single percent of market share. This permeated the
whole company culture and had to be factored into the
analysis.
Another situation involved competitors and how they act
as they go from one industry or market to another. At
Motorola we were facing competitors who had dominated
their consumer markets and were now moving into the
industrial electronics area. To understand how they would they

4. Volume 5 • Number 4 • JULY–AUGUST 2002 Competitive Intelligence Magazine 9
act in a totally different marketplace we looked at how they
had entered new markets, and how they became the dominant
force. The Japanese companies had a pattern: they came in and
did private labeling. Soon they selected a specific part of the
value chain to control, such as a distribution channel or key
components. When that control was established, they domi-
nated the industry. Once we understood that, we developed a
counter-strategy.
I’ve also used cultural analysis in forging strategic alliances
where you look at the non-business attributes of the deal. From
an intelligence standpoint, we looked at the management style,
the values that the organization had, and how they would
protect a partner’s intellectual property. This analysis often
helped us make the right alliance decisions.
Finally, we took a look at our own company’s culture to see
if the competition could use that to predict what we were
planning. At Motorola we analyzed our own corporate culture,
both written and unwritten. We read articles about ourselves,
and most of those cultural components were there. You could
read us like a book.
To use cultural analysis effectively, you have to understand
what you bring to the table as intelligence analysts, and
understand your own biases.
Michael Harris:
When I first got here, I thought that I’d be coming out of “left
field” and my orientation would be so radically different
nobody would understand it. But it turns out the materials I’m
going to touch on actually mesh quite well with what other
presenters have said. How we speak of culture affects how we
analyze culture.
My background is in psychology and human resource
management. Today these fields are very quantitative and
measurement-oriented. That can be either good or bad de-
pending on your perspective. I took part in this panel because
I like taking different approaches to problems, and the worst
people could say is: “Well, he had no idea what we were going
to be talking about and so he just did the best he could.”
Culture is a major concern in human resource manage-
ment for a variety of reasons. For example, in recruitment
there’s a strong emphasis today on setting up and establishing
a company culture that will help convince people to join your
firm. You can see this emphasis on culture by going to certain
recruitment websites. My favorite example is futuresteps.com,
where part of what they do is to assess your cultural orienta-
tion, so they can try to match you with an organization with a
similar culture.
Retention is also a key issue. There is increasing discussion
of how employees want to stay in an organization that has a
good culture and matches their own cultural comfort zone.
Merger issues—just pick up any Wall Street Journal. A
recent article on TWA/American Airlines mentioned cultural
differences between the two firms. Obviously, companies based
in different countries have different cultures, and there’s also a
lot of discussion today in human resource management about
how to get companies with very different cultures to work
together.
How we measure culture, as the two presenters indicated
earlier, can be a sensitive issue. Let me share several points that
people in human resource management consider when they
measure culture. Looking from the perspective of recruitment,
there have been several studies done in which recruiters are
asked to evaluate the culture of their organization or will ask
applicants to state what they think the culture of this organiza-
tion is like.
Several organizational studies have developed inventories
or scales, almost like personality scales or very similar to them.
One of the more well known ones asks: “How important are
these values to you or to the organization?” Some specify issues
such as risk taking, fairness, working long hours, being team
oriented. And from a somewhat naive perspective they’ll ask
applicants “What do you think - how do you think this
organization values those items?” Then they’ll ask recruiters or
other managers the same questions and essentially compare the
two. The research, of course, indicates that different recruiters
can have different perceptions reflecting perhaps subcultures
and so on and so forth.
You might also measure culture by asking former employ-
ees, outsiders and individuals who have worked as consultants
or contractors. For an insider perspective, there are websites
where employees talk about companies. Vault.com comes to
mind.
In comparing Asian culture with Western culture G.
Hofstede in his book Cultures and organizations: Software of the
mind, (London: McGraw Hill, 1991) found several dimen-
From an intelligence
standpoint, we
looked at the
management style,
the values that the
organization had,
and how they would
protect a partner’s
intellectual property.

5. Competitive Intelligence Magazine Volume 5 • Number 4 • JULY–AUGUST 200210
sions along which cultures differ in terms of their focus on the
group versus the individual. The dimensions he identified to
compare cultures and even create ratings are:
• Uncertainty avoidance.
• Masculinity-femininity.
• Individualism-collectivism.
• Power distance.
• Short-term or long-term orientation.
The ASA (Attraction-Selection-Attrition) theory argues
that the personalities of the organization’s founders make the
culture and determine the ultimate strategy. The personality of
the leader sets the tone for the organization and the rest follows
from there. The founders also perpetuate this personality by
hiring people who have a similar orientation and personality.
The last point that I’d like address is how you go about
changing culture, which I consider a fascinating issue. If you
buy the ASA argument that the founders set the tone and
determine the culture, then they also create the reward system.
My own personal experience suggests people respond well to
changing the reward system, so if you can change those
contingencies, that has a lot to do with changing the
organization’s culture.
Alison Bourey—Summary
Our panelists have presented ways to add corporate cultural
analysis to our CI toolkit, suggesting both data collection
methods and analytical scales. They have shown the major
obstacle to using corporate cultural analysis too: the gravita-
tional pull of our own company’s culture. Overcoming the
internal cultural bias takes the real trust of the senior manage-
ment client as well as skill and diversity in the team doing the
cultural analyses.
There are powerful direct and indirect rewards for build-
ing corporate cultural analysis. The analysis allows us to “walk
a mile in the other man’s shoes,” and thereby better understand
the competitor’s style of operating so our company can
anticipate the competitor’s strategy and execution. Under-
standing both the strategy and the style of the other organiza-
tion is a great tool to be used in conjunction with other
standard analysis techniques to add insight and richness to our
understanding of why companies operate as they do. Corpo-
rate cultural analysis is especially helpful in areas such as
mergers, acquisitions and alliances.
There is a powerful indirect benefit, too – learning about
our own company, its style. leadership, reward systems and
how our culture with its strengths and limitations shape our
own orbit through the industry.
Editor’s note: Selections from the panelists’ Q&A session
will appear in forthcoming issues of SCIP.online.
Jan P. Herring is a pioneer and recognized expert in the field of
business competitive intelligence. He is a charter member and
Fellow of SCIP. In 1993, Mr. Herring was awarded the Society’s
highest honor, the Meritorious Award, in recognition of his
contributions to both SCIP and the profession itself. He has given
talks on business intelligence to the U.S. and Canadian Confer-
ence Boards, the Planning Forum, the Association for the Ad-
vancement of American Science, the Industrial Research Institute,
and the Society of Insurance Research. In addition, he has lectured
at The Wharton School, Stanford University, MIT’s Sloan School,
Tufts University’s Fletcher School, Northwestern University’s Kellogg
School, Boston University, Babson College, and both Stockholm
and Lund Universities’ Schools of Economics. His firm, Herring &
Associates, is based in Hartford, Connecticut. E-mail:
jpherring@snet.net
Regina D. Klein is the manager of R&D strategy for Pharmacia.
As part of the R&D Strategy Group, she is responsible for business
analysis and intelligence supporting portfolio strategy and new
ventures. From 1999 until October 2000, Ms. Klein was the
manager of business intelligence for the Nutrition & Consumer
Sector of Monsanto, where she was responsible for the creation of
the business intelligence function, incorporating business intelli-
gence and strategic competitive analysis with technology intelli-
gence to support research and development, commercial develop-
ment and strategic decision-making in the Nutrition & Consumer
Sector. Ms. Klein received the Monsanto Science and Technology
Reach Award for these accomplishments in 1997. She has champi-
oned competitive intelligence throughout her career at Monsanto,
and has written and lectured on the topics of business information
and knowledge management. A member of SCIP and the Confer-
ence Board Council on Competitive Analysis, Ms. Klein received
her B.A. and M.A. degrees in library science from the University of
Missouriand her M.B.A. from Southern Illinois University. She
also has completed the advanced skills training program at the
Centre for Operational Business Intelligence and the Academy of
Competitive Intelligence at Georgetown University in April 1997
Please note: Ms. Klein’s views do not represent those of the
Pharmacia Corporation. E-mail: regina.d.klein@pharmacia.com.
Michael Harris holds a Ph.D. in industrial and organizational
psychology, and is currently professor of management in the College
of Business Administration at the University of Missouri-St. Louis.
His area of specialty is human resource management, and he is the
author or editor of three books and numerous book chapters and
articles. His research covers topics such as staffing, compensation,
and performance management. His recent chapter in the Hand-
book of Multisource Feedback (Jossey-Bass Publishers) examines
the relationship between various aspects of organizational culture
and its effect on the use of 360-degree feedback. Dr. Harris
regularly conducts seminars on interviewing, discrimination laws,
and related topics and has served as an expert witness in a variety
of employment discrimination lawsuits involving hiring, promo-
tions, terminations, and compensation.
Alison T. Bourey is a market intelligence manager for Express-
Scripts. Previously, she served as a CI analyst for Solutia. She has
a broad background in health care planning and marketing
research. She also has background in social services and academia,
having served on the faculties of Washington University, Univer-
sity of South Carolina—Coastal Carolina College and University
of Wisconsin—LaCrosse. She has a Ph.D. in sociology from The
Florida State University. E-mail: atbourey@mindspring.com.