Dissing the competition through dirty tricks!

An article in the New Zealand Herald - Cloak & Dagger Tactics Hit the Office gives an interesting perspective on how dirty tricks, espionage and other unethical practices can hurt companies. Unfortunately there is nothing new in the idea that competitors and others can deliberately aim to hurt rival organizations using unethical and illegal approaches.

Competitive intelligence (CI) is primarily about finding information on your competitive environment - competitors, customers, suppliers as well as general business trends that could impact you. (AWARE's brief guide to competitive intelligence tells you more about this).

One common technique is to identify the key intelligence topics (KITs) that you need to focus on to give you that competitive edge. These KITs will are aimed at helping you understand competitor strategies and the reasons competitors are doing what they are doing - as one example.

One topic that all organizations should look at is what others are saying about you.

• What do your customers think about your products and services?
• What do suppliers think about your negotiating skills - are you a push-over?
• How do competitors view your position in the marketplace - and what do they see as your vulnerabilities?

You need to do this globally. Don't just focus on your key local competitors, but consider those from further afield. New threats could be coming from anywhere: Brazil, India, China.... In fact, CI is a truly global discipline, and it is essential to know thy competitors - wherever they are located.

Sometimes what you'll discover may be uncomfortable. In 1993, Virgin Atlantic discovered that BA had gained access to confidential files and was using these to poach customers from the airline. This led to a protracted court case - BA lost.

More recently, the Canadian insurer, Fairfax, was the target of a campaign of malicious disinformation from a group of Wall Street Hedge Fund managers. The company is now suing them for $6 billion - claiming that their aim was to manipulate the market by creating uncertainty about the company and its future. These include a variety of dirty tricks - false emails and letters, espionage attempts and more.

The lesson from these two cases (and there are many more) is that it is important to watch out for what others are doing to you. Don't assume that your competitors always play fair - some don't.

You need to keep a look out for unethical practices:

• the phone call from the "student" asking for help with a school project;
• the visit from an "industry analyst" claiming to be writing a stock report

and so on.

Always check that they are who they say they are before confiding anything. If suspicious refuse to give any information away.

Even more important, beware of scams that may try and lull you into a false sense of security: the "official" who claims to be a government tax inspector, who then gives a phone number that you can use to check him up. Except that the people answering the phone are in on the scam! (For any official organizations it should be easy to verify that the phone number is real).

Or the organization using a fake, but official sounding name (e.g. in the UK, many companies are conned into paying more than needed by companies calling themselves things like "Data Protection Office Ltd" which sounds sufficiently similar to the real Data Protection Registrar.)

The old adage Buyer Beware (Caveat Emptor) holds. A key intelligence topic that all companies should include in their armory is the one that focuses on what competitors are doing aimed directly at you - what they are saying, what they thinking, and what they are doing, especially if they have a propensity to play dirty!

Know your information sources

I'm not sure what the weather is like outside London. Summer here could have been better - but also a lot worse. I know that there are heatwaves in Southern Europe, and I'm sure that even though hurricanes hardly hever happen in Spain (where there currently is not much rain on the plain), this is not the case everywhere. And as Discovery found out, you can't predict when bad weather can cause you to change your landing slot!

It is important to know information sources. When I do competitive intelligence training, one workshop exercise I take people through is to show how many different information sources there actually are. I do this by compiling an A to Z of information sources - with one rule, that they must all be different types. (So you can't have Search Engine and then Yahoo! as options for S and Y as Yahoo! is a Search Engine and so is included in this category). Try it - it is not that difficult. I have 4 items for K and 2 for Q, X and Z. Most other letters get spoilt for choice.

However it is not just good enough to know your information sources. You should also know how accurate they are - and ideally how the source gathers the information. Only then can you guard against disinformation - or perhaps from using secondary information that you think is actually a primary source.

There is a story:

A film crew was on location deep in the desert. One day an
elderly native American went up to the director and said, "Tomorrow rain."
The next day it rained. A week later, the native American went up to
the director and said, "Tomorrow storm."

The next day there was a hailstorm. "This Indian is
incredible," said the director. He told his secretary to
hire the man to predict the weather for the remaining of
the shoot. However, after several successful predictions,
the old native American didn't show up for two weeks.

Finally the director sent for him. "I have to shoot a big
scene tomorrow," said the director, "and I'm depending on
you. What will the weather be like?"

The native American shrugged his shoulders. "Don't know," he said.
"My radio is broken."

So before using a source, make sure you fully understand it - and any drawbacks or weaknesses associated with it.

The above story illustrates the need to know your source's source. There is a variation on the story illustrating the same lesson, but also showing how important it is to be objective. Some sources are not totally objective, and so the information provided can actually be false or disinformation.

The Native Americans asked their Chief in autumn, if the winter was going to be cold or not. Not really knowing an answer, the chief replies that the winter was going to be cold and that the members of the village were to collect wood to be prepared.

Being a good leader, he then went to the next phone booth and called the National Weather Service and asked, "Is this winter to be cold?"

The man on the phone responded, "This winter was going to be quite cold indeed."

So the Chief went back to speed up his people to collect even more wood to be prepared. A week later he called the National Weather Service again, "Is it going to be a very cold winter?"

"Yes," the man replied, "it's going to be a very cold winter."

So the Chief goes back to his people and orders them to go and find every scrap of wood they can find. Two weeks later he calls the National Weather Service again: "Are you absolutely sure, that the winter is going to be very cold?"

"Absolutely," the man replies, "the Native Americans are collecting wood like crazy!"

As real examples of disinformation, there is the well known Di-hydrogen Monoxide Research Division web-site.

Another interesting example is the satellite maps shown for 1 Infinite Loop, Cupertino, CA 95014 on Google Maps compared to that on Microsoft's Virtual Earth.

Of course it could be that Microsoft is using a satellite image from around 30 or so years ago (despite the 2004 copyright notice from NAVTEQ at the bottom). More likely is that Microsoft just wants to air-brush a major competitor - Apple Computers - out of history.

As somebody who has just received delivery of my brand new Apple iBook, I can fully understand why Microsoft would like to do this. However just renaming your future operating system from a breed of cow (Longhorn) to a long-term view (Vista) does not make it a Tiger! :-).

From a competitive intelligence information source point of view the above two maps show how easy it is to

a) misinform
b) blind yourself to the real picture
c) use a respected information source such as Microsoft's mapping software that may not be totally accurate.