March 23, 2021 • By Keith Giles
Leonard Lane, a senior lecturer at the UCI Paul Merage School of Business, and Ratcliffe, founder of CI-Strategy and head of health and life sciences at Fuld+Co, have seen the future, and it’s a little bit terrifying. “We use the term ‘VUCA’ to describe the sort of world we’re in today,” says Lane. “That stands for volatile, uncertain, complex and ambiguous.”
Lane and Ratcliffe believe that to survive and thrive in a VUCA world, businesses must turn to the emerging science of Competitive Intelligence, or CI. In their recently published book, Competitive Intelligence 2.0: Competing in a Digital World, they explain how CI can give businesses an edge in our increasingly unpredictable world.
How Did We Get Here?
Ratcliffe describes an expanding flow of information that has added to the turbulence of today’s business waters. “There are key trends in the growth of information over the last 500 years that can’t be ignored and that will not suddenly stop. The internet and the cloud—and now AI—are creating massive volumes of real-time information that can be used to gain competitive advantage if captured, curated and analyzed correctly.”
All of this has led us to a global and layered business world where technology is increasingly creating disruptors to the competitive environment. Simply put, “It’s constantly becoming more and more complex to understand what’s happening around us, today,” says Ratcliffe. “But we’re great believers in historical trends and understanding those trends helps us see the future.”
Making Sense of the Data
Lane developed and teaches the School’s CI class and Ratcliffe is a guest lecturer in the class helping students understand these concepts. “What we’ve learned is that Competitive Intelligence is an integral part of building an effective competitive strategy,” says Lane, “and you need solid data driven intelligence to build that strategy.”
They argue that CI work is integral to a firm’s strategy and strategy implementation “CI can help you understand what is going on today in the marketplace,” says Lane, “pitching against competitors, understanding the digital world—all very tactical. But it’s a process that is needed in the core strategy world. That’s why we wrote this book; to connect competitive intelligence to strategy development and expand the fields horizons beyond the tactical.”
This realization inspired application in their book of the White Water World (WWW) concept developed by Ann Pendelton-Julian and John Seely Brown. Lane says, “In the WWW, things are hyper-connected, radically contingent and fast. We need to have the capability to read what’s going on beneath the surface in order to navigate the white water on the surface. To build an intelligence driven competitive strategy, the CI professionals and the strategic side of the organization need to come together,” says Lane. “That’s what will lead us into the sort of CI that gives rise to the breed of the ‘Intelligent Company,’ one that can truly thrive in tomorrow’s world.”
In other words, “Instead of making a strategy that’s up in the clouds, we need to create one that is grounded in context. “We make strategy with our hands,” he says and quotes Andy Grove of Intel “Only the paranoid survives.”
Leveraging Artificial Intelligence
Survival is, of course, only one challenge organizations face when seeking to adapt to this new VUCA world. Thriving is yet another.
As Ratcliffe explains, “There are individual companies that are already ‘doing the future’ and they give pointers where markets are going. AI can help track these companies and make sense of large data sets in near real-time. For example, you can get AI to feed amazing visualization tools, like maps and spider diagrams in a way that you can’t do otherwise. AI can give the CI professional tools to capture and make sense of information in a way that simply was not possible even 20 years ago.”
Lane agrees. “As you take all of these trends and factors brought about bythe exponential increase in computing power, it still takes people to make the human decisions,” he says. “CI is both a science and an art. We call that learning to dance with the data scientist. This is what the CI pro needs to develop within the organization. Their job is to go out and work with the line managers and show them the importance of using the data that are now accessible to them—breaking the silos that allows the organization to become more intelligent.”
Until now, most companies wanting to utilize AI have been limited by the costs. “You need a lot of money and resources to build AI tools, and there is also a major advantage of building this capability internally rather than subcontracting it out to a third party” says Ratcliffe. “Bigger companies are the ones who have the resources and the data to do AI internally. So, to date we have seen the bigger companies using AI to gain competitive advantage, with many small companies not being aware of the threat of AI until it is too late,” he says. “Yet another new competitive dynamic for the CI professional to be aware of.”
“Obviously, most CI professionals already know they’re in a White Water World,” he says, “but they don’t understand what it’s all about. Our book helps them connect those trends and connect CI to their company’s strategy to help drive it towards becoming the Intelligent Company.”
“The future is here,” Ratcliffe says. “You just have to look for it.”
Competitive Intelligence 2.0: Competing in a Digital World is available now on Amazon.