There are several different methods of conducting competitive intelligence analysis. Some popular methods include doing a strength, weakness, opportunity, and threat (SWOT) analysis; determining market share; and profiling individual competitors. The overall goal is to decide which areas an organization can improve in order to become more competitive in its industry.
A SWOT analysis can be an effective way to start the process of competitive intelligence analysis. It provides an overview of a competitor which, when compared with other organizations, can reveal a great deal about how each company is positioned. Understanding the strengths and weaknesses of a competitor can help an organization to improve its own best practices and find ways to get an edge in the market. By determining the opportunities and threats that face competitors, an organization can gain insight into the overall industry environment and the specific characteristics of individual companies.
When conducting competitive intelligence analysis it can be useful to have a profile of each competitor. This system tends to be most effective when the same template is used in the preparation of each profile. The SWOT analysis can provide a strong starting point for competitor profiles. From that base, an organization can delve more deeply into the past and present activities of a company. The goal is to determine why the company is positioned as it is, so that the organization can develop a strategy to exploit that competitor’s weaknesses and address their strengths.
Another way to conduct competitive intelligence analysis is to determine the market share of the organization and its competitors. Once this has been established, an organization can analyze the activities collected in its competitor profiles in order to find out what actions lead to each competitor’s market position. By comparing successes and failures, an organization can create a strategy for taking more market share.
Once an organization has analyzed competitive intelligence, it should have the tools to create a strategy to improve its market share. It will typically know where it can compete and which areas are best left to the competitors. The organization may also have some insight into which areas it can invest in to gain an edge over its competitors. A thorough analysis will usually also reveal how competitors may be able to gain an advantage over an organization. By understanding potential threats, it is easier to formulate a plan to protect the company and enable it to thrive.