I’m a big fan of the Francis Ford Coppola series. One of my most favorite lines is from the first film is delivered by Vito Corleone (played by Marlon Brando) when he teaches his lieutenants to "keep your friends close, but your enemies closer."
Tough guy image aside, this also makes very good business sense.
Here’s why. Knowing what your competitors are doing before the market does can enable an organization to respond quicker and, potentially, get the upper hand. Conversely, what often kills most companies is a lack of foresight compounded by poor access to critical industry information. This can significantly impact product development, marketing, sales, operations and any other business strategy. More importantly, knowing where the industry is going and who is taking it there is an essential role business leaders must play.
Now all this doesn’t mean putting on a dark, three-piece suit and holding a classic mobster movie marathon viewing. However, it does require companies to start looking at how they conduct competitive analysis, and make it part of their regular routine. Here are some ways to do that without adding another expense line to the financial income statement:
Use the tools that Google gave you: Create news alerts; free services offered by leading search engines that will send automated emails when an article or new piece of Internet content appears based on specific keywords. Most executives and marketers set up one for their own company. It’s also a good way to keep tabs on rivals. Checking their website and related Internet properties on a regular basis wouldn’t hurt either.
Enlist the help of others: Customers, partners and third-party folks such as heads of trade or business organizations can be invaluable in providing information. Competitors undoubtedly are pursuing them, and in doing so can give good insights into their sales process, promotion strategies, pricing and potentially even their product roadmap. Even a sliver of such knowledge can be of great help in staying ahead of the curve.
Just ask them: Seriously, this does work, particularly at industry trade shows and events put on by professional organizations where competitors often coexist. Most of these booths are manned by sales and marketing folks that are natural talkers. Engaging them in conversation can bring about good solid information that would otherwise not be accessible.
It’s certainly understandable that entrepreneurs and executives can focus so much on internal matters that they forget to keep their eyes on the industry and competitive landscape. While there’s a possibility of become too distracted by paying too much attention to rivals, not checking up on them periodically can be just as detrimental. Doing so is an essential part of a successful business strategy.