Competitive intelligence (CI) is the monitoring of competitive scenario to understand and predict the next possible move - knowing what the competitors are determined to do, before they do it. This involves tactful collection of data, collation and analysis of information. These would be helpful in making informed business decisions and create an impact in the market.
As a practice, CI largely depends on the success, accuracy of data and source of information. Though data is freely available (not always), ambiguities arise when a standard guideline is not followed. Ethics and ethical behaviours are of importance here since the area is usually perceived as positive to a company's reputation and competitiveness. It would not be useful for a firm to undertake its intelligence activities without regard to ethical or legal considerations.
The cost of stepping over the line into the black is far too severe and unnecessary. The most ethical manner will be gathering data that is freely available, for example in press releases, annual reports and job advertisements. But sending employees to job interviews at competitor organisations in order to gather information about their plans may not be ethical.
Ethical issues
Ethical concerns in CI periodically receive attention from the business press, particularly when unethical practices overlap with clearly illegal behaviour.
Some of the ethical issues facing CI practitioners are sufficiently ambiguous or debatable that they are not likely to go away unless CI practitioners can agree about what is appropriate and not.
Corporate espionage vs CI
Espionage is sometimes called the dark sister of CI. Espionage is more than the legal and ordinary methods of examining corporate publications, web sites, patent filings and the like to determine the activities of a corporation. In business language, the term covers more illegal methods such as bribery, blackmail, technological surveillance and even occasional violence. CI research can be distinguished from corporate espionage, as CI practitioners in general abide by local legal guidelines and ethical business norms.
Omission vs complete disclosure
Relevant information is often omitted during an interview, but is it unethical to withhold such information? For example, a student pursuing MBA and working part time at a firm is asked to gather information of a competitor firm. Would he/she disclose that he/she is working for 'ABC' firm, or just say that as part of his/her course requirements, he/she would want to know information on the 'XYZ' company? If the person on the other end of the telephone had known his full identity (i.e. strategic planner and graduate student), the information might have not been shared.
The client/consultant relationship
Generally, companies are adamant about the care they take in selecting consultants as they are viewed as an extension of the firm and its valuable public image. This is because they are concerned about the possibility that the firm's reputation could be sullied by an over aggressive consultant. They conduct lengthy interviews with consultants, check references and evaluate written proposals adhering to laws and company's own ethical codes. But both consultants and their corporate clients are hesitant to discuss the ethics issue in much detail. They seem content enough to live with some ambiguity in this aspect of the relationship and take their chances with the outcome.
Yet, the only way a corporate client can be sure that a consultant is using ethical collection methods is to make the corporation's expectations and standards explicit, discuss them during negotiations and make them a part of the contractual relationship. Further, consultants must not wait for their clients to raise these issues. Their ethics are their own responsibility and should be made clear to their clients.
Legal vs ethical
In 1988, a fortune magazine article outlined Marriott's practice of using head hunters to interview regional managers from each of five competitors' economy hotel chains when it was investigating that market. Marriott was able to obtain information regarding salaries, training and managerial expectations. Some people may view such tactics as unethical. Marriott maintained that they were ethically acceptable because job candidates were told no jobs were currently available, but might be available in the future, and because several of the interviewees were later hired.
Why care about ethics?
■ Ethical failures diminish reputation; which is the hallmark of a profession
■ Sensitizes the CI practitioners how they want to act consistently
■ Help avoid criminal acts and ensure that policies and practice are legal
■ Articulating ethical standards now makes it easier to respond to criticism later
■ Ethical practice promote a strong public image
Over all, inclination to ethical practice improves trust in relationships between individuals and groups, supports greater consistency in standards and qualities.
Implications
While CI as a practice is evolving more professionally, agreed up on standards will enforce the need to follow ethics by every individual in a firm. In the case of consultants, they consider themselves as an extension of the company. If they resort to unethical actions, it would reflect badly on both the company and the individual.
These techniques rely on an individual's upbringing, education and professional background for guidance. But this might be different for every person. This provides one of the reasons why members of the profession need to come to consensus about ethical issues in CI practice.
Consultants need to protect client confidentiality. At the same time, it is important not to deceive the information target. Thus, the ethical obligation to protect client confidentiality needs to be balanced with the obligation not to deceive information targets.
Similarly, consultancies should explicitly address the potential for conflicts of interest within their work. Solutions are likely to be more effective, if these potential conflicts are discussed and decisions are made in advance about how they will be handled. The profession should address these issues explicitly but, until then, CI groups within organisations should attempt to come to an agreement amongst them about what is appropriate and not.
One of the major issues that needs to be addressed is that most of the CI practitioners feel very much on their own, without the support from their respective organisations. They have to rely on personal background and intuition to make tough ethical decisions.
This is largely determined by the CI practitioners urge and necessity to understand ethical issues and concerns, which are often left unspoken because of perceived or real pressure from other organisations. The payoff will be growing public approval for the profession and trust among practitioners and between practitioners and other stakeholders.
(The author is senior consultant with PharmARC Analytic Solutions, Bangalore)