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Requiring the Use of CI

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Requiring the Use of CI

In some firms, the most effective way to put CI to use immediately is to require that every operating business unit (whether it is a small sales department or a large multinational subsidiary) include with its annual plan (whether capital, marketing, or strategy) an appraisal both of current competition and the current marketplace as it impacts its decisions. Experience shows that this formal directive is very often needed in addition to a general admonition that the planning process must take into account competitors and competition.

Put in another way, if management cannot see the competitive information set forth separately, it may have no guarantee that those preparing the plan have actually taken it into account or that they have even looked into it. Also, by seeing the CI that the unit has developed, management can evaluate its appropriateness and adequacy and suggest additional sources.

A second step would be to require that the individual plan not only indicate the current competitive environment but also show how the unit perceives the future environment. From there, management can insist that the specific unit indicate how it intends to respond to changes in its competitive environment.

CI can be successfully injected in a similar manner at many stages other than the planning processes. When you consider fundamental corporate decisions, such as an acquisition, divestiture, major capital investment, or introduction of a new product, management can require that those involved, both in considering and in advocating the transaction, prepare a competitive analysis. The analysis should indicate how the planned action will assist your firm to respond to its competitors and how the affected competitors may be expected to respond.


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