There are four stages in monitoring competitors - the four "C"s:
- Collecting the information (with a first stage - deciding what to collect)
- Converting information into intelligence (CIA - Collate and catalogue it, Integrate it with other pieces of information and Analyse and interpret it)
- Communicating the intelligence.
- Countering any adverse competitor actions - i.e. using the intelligence.
One mistake a lot of people make is to start by collecting information without thinking how the information will be used. There is no value in information that will just sit on a shelf. If it cannot be used to inform the business's strategic or tactical decisions then the time, money, and effort spent collecting it is wasted.
The business may be planning a new product - so information on what competitors are doing in the same area will help in the decision processes and plans for this new product. Alternatively, the business may be looking at how the industry will develop over the next 5 or 10 years or perhaps the board may be looking at a potential merger, acquisition or business partnership.
The information requirements for each of these business decisions will be completely different and so the information that should be sought will also be different. Thus before starting to search for information the competitor analyst needs to sit back and define what they are looking for and why. They need to identify the key areas of concern for the business decision makers requesting the information, and aim to satisfy these. Other information may be interesting, but unless it helps the decision process it should be viewed as superfluous, and stored for use at another time or even ignored if it is unlikely to ever have value. (As an example, it is generally not necessary to know the name of the CEO's spouse to understand how the CEO makes decisions….but if you are looking at this CEO’s company as a potential alliance partner, capturing this name as well as otherwise superfluous information may indeed be valuable)
Thus, rather than collecting information in a random or haphazard manner, the search needs to be well defined, focused and planned, and aimed at answering the exact intelligence requirements of the business (often termed key intelligence topics, or KITs).