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Competitor Intelligence on Business Markets Revisited: Schools of Thought, a Case Study, and an Agenda for Future Research

Björn S. Ivens, Alexander Leischnig and Hanna El-Muhtaseb

The paper was published at the 32nd IMP-conference in Poznan, Poland in 2016.

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Different schools of thought study business exchange. They have differing views on the role of competition and competitive intelligence (CI). The CI concept is anchored in the strategic planning literature (e.g., Ansoff, 1965: Porter, 1980). Firms are seen as distinct and independent economic units following a stepwise strategy process. In this paradigm, competition is part of a firm’s environment and constitutes a core characteristic of industry structure. Porter (1980) introduces the five forces framework to analyze industries. He posits that the inputs for competitive strategy formulation come from a thorough analysis of competitors. Authors building on Porter discuss the definition of CI (e.g., Attanasio, 1988). They formulate components of competitor analysis systems (e.g., Chen, 1996) and recommendations concerning the CI process. Conceptual work focuses on challenges of information gathering (e.g., Barber, 1991) and environmental scanning (e.g., Babbar & Rai, 1993), or the practical implications of CI (e.g., Barndt, 1992). These articles are complemented by few qualitative studies such as, for example, the one by Ghoshal and Westney (1991). The markets as networks (MaN) approach assumes that a firm’s strategy is both enabled and constrained by external relationships and a firm’s network position. Actors strategize in a context of mutual influence: shared goals are common and cooperation is frequent: competition in its adversarial sense is not seen as a predominant phenomenon. Discussions of CI are scarce. The reasons for this situation are at least twofold. First, interactions, relationships, and networks constitute the units of analysis for MaN scholars, while firms and competitive processes are the focal units of analysis in the strategic planning and competitive strategy schools of thought. Second, the adversarial conceptualization of competition, which is predominant in the strategic planning literature, is not shared in the MaN perspective. MaN focuses on cooperative relationships rather than on confrontations. As a consequence, CI has received limited attention in the MaN literature. However, actors in markets characterized by network structures need informational resources. Ford and Håkansson posit that “competition is actor specific and each actor defines for itself which actors are competitors by identifying them as alternatives” (2013, p. 1020). Any actor requires information about actor bonds, resource ties, and activity links in the network. Because these elements are dynamic, a process of permanent information collection is essential and – to a certain extent – present in any organization within a network. However, how precisely such a process of CI in networks may take place and how the actors involved conceive of it requires further inquiry. A case study (36 interviews conducted in a global industrial company) is used to understand practitioners’ view on CI. We study to what extent their perspectives follow the classical competitive strategy view, and to what extent they pursue MaN thinking. We discuss the implications of our findings for MaN theory as well as managerial practice. Based on our findings we formulate avenues for future research on CI, in particular from a MaN perspective.