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Driving Organizational Intelligence


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Published March 2011

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Driving Organizational Intelligence

  1. 1. Implementing Intelligence Capability at the Organizational Level By KaSandra Husar and Rom Gayoso, Intel Most industry players strive to develop an advancedorganizational intelligence capability, since in many casesthis capability creates a competitive advantage in themarketplace. Intelligence development success can beachieved by artfully utilizing multiple transition methodscombined with strong program management and a clearvision of what exactly this success looks like. In this article we discuss the steps necessary for thecreation of your own Market Intelligence Dossier, which isa structured approach to managing the intelligence effortin any organization. We will also help you locate your firmin the market intelligence maturity curve, and finally wewill work together on some of the best ways to move yourfirm through the maturity curve using tried methods. Figure 1:The PCAA ModelTHE PLAN-COLLECT-ANALYZE-ADAPT MODEL Before your company embarks on an effort to developintelligence capabilities at multiple organizational levels,Volume 13 • Number 4 • October/December 2010 27
  2. 2. implementing intelligence capability at the organizational level deliverables scoped in the Plan phase. In essence, the PCAA Model is one large feedback loop of continuous improvement. Also determine that the intelligence organization has the business knowledge and the ability to properly integrate that knowledge into marketing intelligence and that they can influence stakeholders to drive decisions that impact the bottom line (Husar & Gayoso 2010). One way to guide decision-makers through the robust development of their requisite knowledge base and industry expertise is by implementing the Market Intelligence Dossier Development Process (see Figure 2). MARKET INTELLIGENCE DOSSIER DEVELOPMENT PROCESS The Market Intelligence Dossier Process basically outlines the knowledge areas that decision-makers must have strong acumen in so that they can most effectively impact the business. In reality, as the organization’s eyes and ears are on the external environment, market intelligence practitioners need to have command of the macro forces surrounding the firm, asFigure 2: MI Dossier Development Process well as a deep knowledge of the product offerings and an established process to capture and process intelligence.first ensure that the organization’s individual decision- By following this process one can be assured ofmakers involved in this effort are thoroughly trained and obtaining a substantial knowledge base in the desirededucated on the Market Intelligence Process Plan-Collect- area of business and industry. In essence it guides theAnalyze-Adapt (PCAA) Model (see Figure 1). development of the appropriate knowledge required to Adopting the PCAA Model is a wise investment make optimal business decisions. Once the individuals inof your resources for many reasons. First, the primary an organization have developed these requisite personalbenefits of the Plan phase reside in its ability to assess the market intelligence and business acumen skills, they cantask at hand, and to define the scope of the deliverable. then consider moving the organization as an entity to aThe plan also serves as a rallying point for the troops, as desired state of market intelligence capability.its development requires greater engagement and closercollaboration among different stakeholders. The Collect phase is an important step in the effortsince it translates the data discovery process into the STAGES OF ORGANIZATIONAL MATURITYtactical execution. It is also an excellent opportunity to One way to categorize the current status of intelligencereach out and involve other members of the organization in an organization and map its progression path towardsin the process. In the Analyze phase you concentrate the desired end state is to apply the Organizational Marketyour effort not only on processing the data, but also Intelligence Maturity Stages matrix in Figure 3. Theon translating the key findings into a way your own matrix serves two purposes: one is to help you use definedorganization can understand and apply it. categories to best describe the current stage of market intelligence development in your organization; and the Finally, on the Adapt phase the effort is focused other is to help you draw a plan to help the firm progresson feedback that makes the necessary changes to the from point to point. 28 Competitive Intelligence
  3. 3. implementing intelligence capability at the organizational level Stage 2: Containment The next stage of organizational maturity is that of containment. In this stage, the firm’s decision-makers are expected to develop optimal decisions with some input from benchmarking or market intelligence in order to develop a more complex understanding of the industry environment. They also apply data and information which contributes to theirFigure 3: Organizational MI Transformation PIT Model strategic planning decisions. In addition, these decision-makers occasionally use marketStage 1: Beginning intelligence to focus on opportunities developing in their The first stage of organizational market intelligence outside environment.maturity is characterized by rudimentary and basic Some established infrastructure usually exists in theattempts at developing the intelligence processes. form of a website that decision-makers can access to findIndividuals at the top of the organization or key leadership information and data. In some cases a personal knowledgehave minimal expectations for the intelligence capability. infrastructure is in place to help drive organization-wideThe organization participates in ad-hoc benchmarking and competencies and best known methods.applies some attention to the external environment fordecision-making purposes. At this stage, strategy deliverables require some element of benchmarking and market intelligence to Pockets of stronger capability in business acumen be accepted by upper management. Even though someexist, but for the most part the organization is inwardly knowledge is produced through these two activities, it isfocused and tends to make business decisions in an still not sufficient to enable the firm to develop a strongerinformation vacuum. Some individuals may make token market orientation or a competitive advantage as Wangefforts to build an infrastructure that enables data and (2010) envisioned it.information gathering. In this stage, market intelligencecreates a slight-to-nonexistent effect on or input to the Stages 1 and 2 of market intelligence maturitydevelopment of cost strategies. are characteristic of an organization which is in a reactionary state. In most cases this type of organization In many cases, the company bases its future strategic finds itself reacting to changing environmental factors andobjectives or goals on an extension of its historical or operating in a ‘firefighting’ mode because of its lack ofcurrent goals. Then, the market intelligence function is strategic insight into changes in the environment existinga far from acting as a strategic multiplier of corporate outside of the company’s four walls.performance as Wolfberg (2006) envisioned it to be.Neither can it operate as the analytical base necessary todevelop an operational competitive intelligence system Stage 3: In Controlas Hou and Chen (2008) thought it should be as the The next phase of maturity exists when therequired organizational, inter-personal, and informational organization has developed, implemented, and applied anetworks at this stage would either be non-existent or not full intelligence process. In this phase the top leadershipdeveloped enough to allow the market intelligence activity levels convey in a clear and articulated tone that strongto flourish.Volume 13 • Number 4 • October/December 2010 29
  4. 4. implementing intelligence capability at the organizational levelbusiness acumen, which incorporates knowledge of the knowledge of impact factors is an integral part of “how”company’s environment, is expected when developing one goes about making decisions. This knowledge isstrategy. Forward looking planning, anticipation of market embedded in the fabric of an individual’s job role and thetrends, and an understanding of environmental impact culture of the organization.factors (PEST) are beginning to be the “way we do our Sufficient human and financial resources are providedjobs,” replacing the event driven and reactionary approach. to ensure that the right information is available to the right In most cases an established central group of people, and it assists them in making the right decisions.intelligence experts are heavily involved in managing and Appropriate data sources, analytical tools, and planningreporting results from an ongoing monitoring of external expertise are in place and funded.elements that can impact strategy or be an impetus for The decision-makers themselves have been thoroughlyreassessing its direction. In some cases, this central team trained in how to utilize advanced analytical tools such asof experts serves a dual function, also operating in an multivariate factor analysis, wargaming, scenario planning,enabling role for the organization. Porters industry analysis, SWOT techniques, and PEST Here the central team is responsible for developing monitoring. In addition, every decision-maker has aand managing the intelligence information backbone and continuously updated dossier in their area of responsibility.infrastructure based on people, information, and tools. This state of knowledge is advanced and proactive inIncluded in this infrastructure is the means to apply the nature.more advanced analytical toolsets and predictive scenario Based on the availability of strong expertise, at thisplanning. This infrastructure is designed, developed, level internal business partners recognize both the marketand implemented for the use of the entire organization. intelligence team and its individuals as the “go to” sourcesHowever its operations are primarily focused on for business and market knowledge. This results indeveloping and driving strategy and decisions. corporate strategy development benefitting from a highly In this stage the company has created a robust business collaborative front end engagement.acumen and intelligence training, and employees have In the role model stage the intelligence infrastructureaccess to skill-set up-leveling tools. When developing drives value creation throughout the organization. Thestrategic objectives and targets, market intelligence market intelligence function not only enables strategy, butbecomes an integral part of this goal setting. In many is also an integral part of the feedback loop, responsible forcases, corporate leaders decide to achieve this stage for monitoring and introducing operational corrections much80% of the individuals and planning efforts in their the same way Peterson & Wofford (2007) envisioned it.organization(s). They move only a few select critical groupsof decision-makers to the final stage of role modeling,based on a cost benefit analysis of the time and resources Stage 5: Thought Leadersrequired to reach the stage 4 level. The final stage of organizational maturity can be characterized as that of a role model but with added impact across industry lines which can completely changeStage 4: Role Model the way the company conducts business. In this case, This organizational maturity stage is achieved the decision-makers are thought leaders. They push thewhen the firm’s strategic decision-making and market envelope by developing new ways to do business andintelligence functions are recognized as an industry driving the industry with innovative strategies at therole model. In this stage, senior management not only leading edge of thought and development (and in manyexpects decision-makers to be knowledgeable about their cases across industry lines). For example, when a marketbusiness, but also to be viewed as the leading experts in intelligence professional in Delta Company develops a newtheir respective industries. In many cases, these individuals and innovative type of analytical tool or method that is notpublish white papers, speak at industry conferences, hold only useful in Delta Company’s markets but also acrosspatents, process copyrights, and author books. unrelated industry lines, this would be characteristic of the At this stage the organization operates with the game-changing stage.implied understanding that including environmental An organization operating at this level considers its market intelligence capability a competitive advantage with 30 Competitive Intelligence
  5. 5. implementing intelligence capability at the organizational leveldirect impact on the company’s successin the marketplace. It would be viewedby others as best-in-class in the practiceof market intelligence. This company’semployees would be actively recruitedto impart cutting edge knowledge byparticipating in global consortiumsand cross-industry forums such as theCorporate Executive Board (CEB),Strategic and Competitive IntelligenceProfessionals (SCIP) and more. At this stage, senior managersutilize the market intelligence functionsto sustain strategic competitiveadvantage (Vanoy & Salam 2010).Their individual experts work tocontinuously create decisions that Figure 4: Organizational MI Maturity Stagesensure sustainable superior corporateperformance (Tang & Liao 2010). Stages 3 through 5 of the market intelligence The need to focus on people as change agents is notmaturity curve are characteristic of an organization new (see Perme 1999). But over time the focus on peoplewhich is in a proactive state. In this state an organization has evolved to include an understanding of how thoseis operating a strong early warning system to identify empowered employees actually became a source of creativepotential threats and opportunities on the horizon. Its disruption (Prewitt 2001). Currently Transition Changemanagers develop or adjust the company’s strategy so as to Management is viewed as a more holistic process (Prosciintercept these potential blips on the radar. 2010). It encompasses not only managers and senior leaders in the organization, but also includes a focus on individual employee capabilities as well as on teams. Much of the focus on enabling people can beLEADING AN ORGANIZATION THROUGH THE understood by analyzing the Awareness Desire KnowledgeMARKET INTELLIGENCE MATURITY STAGES Ability Reinforcement (ADKAR) model (Hiatt, 2006). It is a substantial challenge to lead an organization This model basically organizes a combination of awareness,through the market intelligence maturity stages and desire, knowledge, ability, and reinforcement to produce atransition it from ‘Beginning’ to ‘Thought Leader.’ structured way to bring about change. In essence, a centralOne of the methods to drive this type of fundamental intelligence team should drive the organization throughintelligence change is to apply the organizational market the phases of maturity utilizing both the PIT and theintelligence transformation People-Information-Tools TCM methodologies in tandem.(PIT) Model. (see Figure 4) This transformation method provides the basis onwhich to develop the backbone infrastructure for thethree main pillars of organizational knowledge: people, PEOPLE INFRASTRUCTUREinformation, and tools. In tandem, this approach is also This pillar of organizational structure refers to theapplicable to the industry methodology of Transition actual individuals who must be dedicated to harnessingChange Management (TCM) which helps transition the knowledge of the entire company. They ensure thatindividuals through the changes in expectation and valuable and accurate knowledge is developed, retained,performance that will lead to their creating the desired and shared among the various parts of the organization. Byresults. identifying a market intelligence lead role for each segmentVolume 13 • Number 4 • October/December 2010 31
  6. 6. implementing intelligence capability at the organizational levelof the business, these individuals ensure development and TOOLS INFRASTRUCTUREoperation of the proper TCM, communications, leadership The final pillar, tools infrastructure, is the mostengagements, sub-org intelligence build, and infrastructure straightforward one. It includes all analytical tools,maintenance. methodologies, constructs, systems, and training required People infrastructure also refers to building networks to ensure that those individuals who drive businessfor strategy development and intelligence. These can exist strategy can not only locate but also utilize these availablewithin multiple partner organizations and across a larger resources. This ensures making the right decisions atdivision or corporation. Whenever effective intelligence the right time in the most effective and efficient waynetworks are required, team members must become possible. These tools can include a regression analysismasters in the art of influencing (Husar & Gayoso 2010). engine, comprehensive secondary research engines,The goal of an effective people infrastructure is providing primary research and benchmarking templates, real-timeaccess to both overt and tacit knowledge and expertise feeds of market indicators and analysis, access to externalacross a large organizational span. This creates reduced consortiums, secondary research firms, and costs and increased transparency, leading to more Equally important is providing robust training ineffective collaboration. these tools. This ensures that experts not only know how to utilize the existing resources, but can also find and process the data and information. The goal is to bring them to the point where they can combine the locatedINFORMATION INFRASTRUCTURE data and information with their own market expertise to The pillar of information structure rests largely on produce key intelligence. This intelligence can then beensuring that decision-makers who are responsible for applied to decision-making and strategy development.strategy and its execution can quickly find and access One appropriate methodology is the market Dossierthe data and information required to make optimal Development Process (see Figure 2), which governs thedecisions for the bottom line. This infrastructure information-to-action process.usually encompasses a robust ‘one-stop-shop’ for the The business environment has become so complexbenchmarking and market intelligence needs of these that it is even difficult for very experienced decision-decision-makers. makers to process all the available information in an The information infrastructure may incorporate effective way (Gayoso & Husar 2008). Fortunately thestreaming data which is centrally managed, and updated recent confluence of data analysis and computer scienceanalysis on areas that impact multiple parts of the business has generated one of the most powerful tools in recent(such as fuel cost expectations or economic predictions). times, data visualization.This reduces the replication of high-level analysis across Data visualization was originally developed formultiple areas of the business, a common issue within applications such as creating 3D models of cities and geo-decentralized organizations. Optimally, each part of visualization (Hotta & Hagiwara 2009) and as tools tothe organization should collaborate with as many other process climate data (Ladstadner & Steiner 2010), with yetdivisions as possible to draw the maximum benefit from other practical applications to come. The ability to detectenterprise-wide licensing or open data sources. and exploit pattern structures in large data sets (Kuznetsov In many cases, the information pillar can be the most 2009) resulted in applying data visualization and mappingdifficult element to create. Although sufficient systems displays as a creative way to present complex informationand software capability may already be available, the and help individuals process vast amounts of informationhuman element in sharing information may not be. If in record time (Chen & Ebert 2009).individuals or the corporate culture have not developed In fact Luboschik & Schumann (2007) postulateda ‘mature organizational’ perspective, issues concerning that data visualization tools can not only deal with massivedata hoarding can arise. In addition, project managers data sets, but also aid in the comprehension of verywithin the market intelligence team must understand complex relationships. In addition Sackett & Williamsthat both data security requirements for information at (2006) found specific applications for data visualization inthe individual level and database integrity are essential the manufacturing environment. A clear example of dataelements of culture transformation success. visualization tools can be found within Egwuekwe’s (2010) 32 Competitive Intelligence
  7. 7. implementing intelligence capability at the organizational levelwork, which is an illustrated map of the unemployment Hiatt, Jeffrey (2006). ADKAR: A model for change inlevels in the United States from January 2007 to August business, government and our community – how to2010. implement successful change in our personal lives. Prosci As the old adage says, a picture is worth a thousand Research.words. Successful-Professional/dp/1930885504 Hotta, Hajime; Hagiwara, Maafumi (2009). “On line geo visualization with fast kernel density estimator.”SUMMARY Proceedings of the 2009 IEEE/WIC/ACM In this article we discussed how market intelligence International Joint Conference on Web Intelligenceis important only to the extent that it is applied and and Intelligent Agent Technology - Volume 1. p622-contributes to the decision-making process. In reality even 625.the most impactful intelligence becomes irrelevant if it isnot acted upon and used to determine strategic direction on environmental factors. Hou, Kaihu; Chen,Ting (2008). “Study on a model Market intelligence practitioners can add value to about competitive intelligence system of enterprisean organization as they adopt a structured approach to based on data mining under electronic commerceadvancing a large organization through the phases of the environment.” IEEE Computer Society in Proceedingsmarket intelligence maturity curve to create competitive of the 2008 International Seminar on Business andadvantage. The maturity curve charts a complex but Information Management, p203-206.critical path to developing a strong early warning system identifies potential threats and opportunities on the ISBIM.2008.75horizon. It also provides one recognized way to transition Husar, KaSandra, Gayoso, Rom (2010). Influencing fora group of executives from reactionary mode to that of a success. Competitive Intelligence Magazine, v13n2,proactive mentality, and empower them to make optimal p7-14.decisions that impact the bottom line. cfm?ItemNumber=11032 Jin-Fu, Wang (2010). “How organizational learningREFERENCES strengthen market orientation: Findings and caseChen, Min; Ebert, David (2009). “Data, information and study.” IEEE Computer Society in Proceedings of knowledge in visualization.” IEEE Computer Graphics the 2010 International Conference on Challenges in and Applications, January, p12-19. Environmental Science and Computer Engineering, March p307-310.Egwuekwe, Latoya (2011). The decline: geography of the recession. January 12 updated. jsp?arnumber=5493288 Kuznetsov, Sergei (2009). “Pattern structures for analyzing complex data.” Rough Sets, Fuzzy Sets, Data MiningGayoso, Rom; Husar, KaSandra (2008). Buy-side market and Granular Computing: Lecture Notes in Computer intelligence practice: reflections form high tech Science, v5908/2009, p33-44. manufacturing. Competitive Intelligence Magazine v11n2, March-April p26-32. Ladstadner, Florian; Steiner, Andrea (2010). Climate data cfm?ItemNumber=3146 using interactive visualization. Journal of Atmospheric & Oceanic Technology, v27n4 p667-679. abs/10.1175/2009JTECHA1374.1Volume 13 • Number 4 • October/December 2010 33
  8. 8. implementing intelligence capability at the organizational levelLuboschik, Martin; Schumann, Heidrun (2007). “Explode Vannoy, Sandra; Salam, A. F. (2010). “Managerial to explain: Illustrative information visualization.” interpretations of the role of information systems Proceedings of the 11th International Conference on in competitive actions and firm performance: A Information Visualization ’07. p301-307. grounded theory investigation.” Information Systems Research v21n3, p496-515. IV.2007.50, Cathy (1999).”Agents of change.” CMP Newsletter abstract/21/3/496 June v8n1. Wolfberg, Adrian (2006). “Full spectrum analysis: A new way of thinking for a new world.” Military Review, July-August.Peterson, J. & Wofford, K. (2007). “Early application of full spectrum analysis as business process.” Portland International Center for Management of Engineering is_4_86/ai_n26968780/ and Technology, August, p1264-1296. jsp?punumber=4349300Priwitt, Edward (2001). “Interview: Clayton Christensen on disruption.” CIO Insider Newsletter, April 1. Rom Gayoso PhD is an economist with Intel Corporation. His expertise is in econometric modeling and he is responsible for Clayton_Christensen_on_Disruption developing several of Intel forecasting models. Rom’s materialsProsci (2010). Change Management Series. Loveland, have been presented at SCIP, World Future Society, Institute of CO: Prosci Research Publishing. Business Forecasting, Intelligence for Business Strategy, Executive MindXchange, as well as Market Research Summit, and Future Trends Conferences. He currently holds 14 entries in the Intel of-2010.htm Patent Database.Sackett, P. & Williams, D. (2006). “A review of data visualization: opportunities in manufacturing sequence management.” International Journal of Computer Integrated Manufacturing v19n7, p689-704. KaSandra Husar is the Manager of the Knowledge Intelligence Management Systems unit at Intel. She is responsible for driving the design and development of the supply side Intel Knowledge bitstream/1826/1885/4/Review%20of%20data%20 Management solution. She also spearheaded the intelligence visualisation-2006.pdf research skill-set up-leveling for supply chain decision makers,Tang, Ying-Chang; Liou, Fen-May (2010). “Does specifically focusing on emerging markets implications. Her firm performance reveal its own causes? The role of materials have been presented at SCIP 2005/2007/2008, the Bayesian inference.” Strategic Management Journal Electronics Supply Chain Association, the Center for Advanced v31n1, p39-57. Purchasing Studies and the Corporate Executive Board. TangLiou.pdf 34 Competitive Intelligence