An Evaluation of the Effectiveness of Competitor Intelligence (CI) as a Management Tool: A Case Study of NLNG Ltd, Migration from Business Intelligence to Competitor Intelligence
Introduction
The modern age of digital electronics made it possible for business and corporate organizations to keep up with the demands of their industries. At present, most business organizations are equipped with the latest information technology (IT) systems that enable them to function fully and effectively. IT has given everyone an opportunity. It has provided every person with the ability to communicate and perform tasks which were impossible to do before the arrival of the 21st century. As such, modern information technology has been considered the result of a crucial connection between digital and communication technologies. It has been declared as the fundamental core of an information system, which involves various interactions between data, the users, software, hardware, business corporations and their environment.
Information has always been a critical factor to a success of a business. For this reason, every company in this age must realize the importance of information technology. Not only does it play a role, but it must somehow, blend with the corporation’s business strategies and techniques. To fully understand the concept of information technology, one must examine its interaction with the world and all its factors around it such as economic, political and social issues. Unless IT professionals are aware of this fact, they are most likely to remain as mere pawns to those who are. Likewise, in the corporate world today, business firms who encounter many setbacks with regards to their IT projects are a result of their failure to understand all the factors that are involved in information systems.
In this case, aside from information technology infrastructures along with privacy, security issues and the ethics and moral obligations of industrial espionage that beset the international business environment, understanding of the strategic plans and objectives of corporations will contribute to the full comprehension of evolving means to doing business at present. Hence, this research activity is geared towards the investigation of the case of Nigeria Liquefied Natural Gas Limited’s (NLNG Ltd) migration from business intelligence to competitor intelligence (CI) as part of its management tool. Evaluation of the effectiveness of competitor intelligence as a management tool will be highlighted by utilizing the implementation and application used by NLNG Ltd.
Methodology
The methodology provides information on the description of the methods and procedures that were conceptualized and constructed in order to obtain the needed data and information that will be most useful to the study. Details on how the accumulated data will be analyzed and interpreted as well as how the conclusion will be drawn is discussed in full extent in this section. This provides justification of the means in which the study will be accomplished and at the same time helps in giving purpose and strength to the validity and reliability of the collected information that makes this particular research practice truthful and analytic. Specifically, this research methodology will cover the following discussions: the research design, the methods used in accomplishing the study, the sampling technique utilized, the statistical treatment used, the validity and reliability of the collected data, and the logical and systematic data presentation and analysis.
Research design. This study will operate under the quantitative paradigm wherein the survey method will be utilized in order to elicit the relevant information needed to complete research ( & , 1992). Besides, quantitative research plainly and distinctively specifies both the independent and the dependent variables under investigation (, 2002). It also follows resolutely the original set of research goals, arriving at more objective conclusions, determining the issues of causality and eliminates or minimises subjectivity of judgment ( & , 1996).
The research variables will be primarily analyzed in order to provide description on the factors that concerns the topic of the study. The variables of the study imply quantitative research wherein the data, situations, or other facts collected will be explained or correlated with other data. Basically, this research will base its findings through quantitative research methods because this permits a flexible and iterative approach. Through this method, qualitative elements that do not have standard measures such as behaviour, attitudes, opinions, and beliefs are analyzed. As such, the information that the informants of the study will share to the researcher will be accordingly examined, analyzed and interpreted to answer the research questions presented.
Research method. The survey method will be implemented in three successive data collection procedures. These will include the pretest of the questionnaire, the actual survey, and the back-checking after the analysis of the data. The pretest of the survey will be necessary in order to identify possible shortcomings of the instrument that may hinder the efficient collection of valid and reliable data. On the other hand, the back-checking that will be implemented will provide assurance that the results of the analysis are consistent with that of the available information and facts in the field. The researcher will gather secondary data and collate published studies from different local and foreign universities and articles from social science journals
This research project will be accomplished by conducting a questionnaire survey using a sample of at least 30 respondents in which inferential statistics will be used in organizing and summarizing the findings of the study. Descriptive statistics will be used to provide and present the background of the industry in a logical manner. The data collection instrument will be a structured questionnaire that will be based on Likert scale. A Likert Scale is a rating scale that requires the subject to indicate his or her degree of agreement or disagreement with a statement. By rating scale we mean the scales that are usually used to measure attitudes towards an object, the degree to which an object contains a particular attribute, (Like or dislike), toward some attribute, or the importance attached to an attribute (, 1991).
The equivalent weights for the answers will be:
Range Interpretation
4.50 – 5.00 Strongly Agree
3.50 – 4.00 Agree
2.50 – 3.49 Uncertain
1.50 – 2.49 Disagree
0.00 – 1.49 Strongly Disagree
Moreover, the use of survey is efficient since copies of the questionnaire could reach a considerable number of respondents through efficient personal distribution. It will serve as an effective and efficient research tool to elicit and exhaust the information that the respondents perceive regarding the topic of the research project at hand. The questions included in the questionnaire are composed mostly of close-ended queries for easy manipulation of the data during analysis and interpretation. The respondents were asked to fill out the self-administered questionnaires until such time that the researcher was able to complete the number of samples for the study. The researcher will tally, score and tabulate all the responses in the provided questionnaires for the subsequent presentation, analysis and interpretation of the data that were accumulated.
Sampling technique. The use of stratified random sampling technique was grounded on the need to ensure the represenativeness of the respondents in the survey method. This particular sampling technique ensures the validity and reliability of the data based on the number or quantity of the respondents who filled out the survey questionnaires. Stratified random sampling technique operates by classifying the target population into group classifications as set by the researcher. The samples are chosen through several selection procedures that usually take several stages depending on the complexity of the characteristics of the possible respondents and the interest of the researcher (, 2001).
Since there is a possibility that several of the accomplished questionnaires will not pass the standards of validity set by the researcher, 5 other individuals who have the same characteristics as that of the defined target samples of the study will also asked to accomplish the questionnaire as reserved samples. Such incidents include half-finished survey form, inconsistent answers, untruthful information and forms of the respondent who did not answer the questionnaire seriously. Upon the completion of the required number of respondents for the survey method, the valid questionnaires will still be included in the presentation and analysis of the findings and results of the study.
Basically, and (1973), initiated that it is advisable to use the Slovin’s formula in choosing sample sizes. Thus, the sample size of the population in this paper was determined by Slovin’s formula. The formula of Slovin is given as follows:
Where:
n = a sample size
N= population size
e= desired margin of error (percent allowance for non-precision because of the use of the sample instead of the population).
Data presentation and analysis. Generally, responses to a questionnaire are objectified and standardised and these make tabulation easy. But more importantly, the respondents’ replies are of their own free will because there is no interviewer to influence them. This is one way to avoid biases, particularly the interviewers’ bias. The answers of the respondents will be first encoded and subsequent tests will be applied to produce quantitative and descriptive data used to complete the research project. Frequency values and percentages of the answers of the respondents compose some of the findings and results of the study.
Percentage – to determine the magnitude of the responses to the questionnaire
n
% = ——– x 100 ; n – number of responses
N N – total number of respondents
The statistical analysis will be conducted using Microsoft Excel where the quantitative data are tabulated, graphed and evaluated. The relationships of the variables will be then analyzed and collated with other findings of the study. The extent and magnitude of the relationship between variables will be presented for the systematic analysis of the collected information. The researcher will use graph and charts for data presentation. Tables, on the other hand, are the summary numbers and figures indicated in rows and columns normally used to present quantitative data and results of the statistical tests. Tables will facilitate the systematic presentation of all the collected data and information from the survey method. Each table will be provided with proper title, number, caption, text and explanation that will comprise most of the results and findings section of the research study.
Validity and reliability of data. Ensuring the validity of the accumulated data is considered to be the most crucial stage of the research endeavor. Since a methodology is always employed in the service of a research question, validation of the inferences made on the basis of data from one analytic approach demands the use of multiple sources of information through validation study built into the design ( & , 1998; & , 2002; , 2001). The triangulation research strategy in which the use of multiple sources to enhance the rigor of the research (, 2002) helps in the in-depth case analysis of the paper. (1995) stated that the protocols that are used to ensure accuracy and alternative explanations are called triangulation. The need for triangulation arises from the ethical need to confirm the validity of the processes. In case studies, this could be done by using multiple sources of data (, 1984).
The data and information gathered in using the secondary data analysis will be used to support and rebut the claims of the study wherein critical examination and analysis of the findings were compared and contrasted with each other. The secondary data were critically analyzed based on the credibility of the authors, the methods used and the sampling procedures made in order to accomplish the said previous research studies. Secondary data analysis is composed of the reviews of references and sources in this study to either support or rebut the claims and findings of this particular research endeavor. This enables the researcher to compare and contrast the results that were accumulated by other researchers who investigated the same topic of research. These include published and available unpublished research studies, case studies, journal articles, and books that have concerned on the investigation and analysis of different concepts, variables and factors that relate to the principal idea of the study’s investigation.
Literature Review
A number of articles, academic papers, journals and other relevant references have provided and researches on the concept of information management. The continuous advancement in technology gave way to inquisitive inquiries on the logic that governs information management, its importance and its drawbacks. It has been studied in the perspective of different disciplines such as social, political, legal management, communication, science, and business courses. Information management has been a familiar concept since then. (1998) discussed the importance of good information management in the ever-increasing demands of the global business industries which are common nowadays. He emphasized the relevance of the search for global efficiency, local responsiveness, transfer learning and external alliances through proper information management in a particular business organization.
Information management (IM) is the administration of data with regards to its uses and transmission as well as the application of theories and techniques of information science to be able to create, modify, or improve information handling systems within a particular business organization (). It is the function of managing the organization’s information resources which includes the creating, capturing, registering, classifying, indexing, storing, retrieving and disposing of records and developing strategies to manage records. It also includes the acquisition, control and disposal of library and other information products, items kept for reference purposes, and the provision of services to internal and external customers, based on information resources. Data administration, archival records and the handling of Freedom of Information (FOI) requests are also classified under this category ().
IM describes the measures required for the effective collection, storage, access, use and disposal of information to support agency business processes. The core of these measures is the management of the definition, ownership, sensitivity, quality and accessibility of information. These measures are addressed at appropriate stages in the strategic planning lifecycle and applied at appropriate stages in the operational lifecycle of the information itself (). It is the provision of relevant information to the right person at the right time in a usable form to facilitate situational understanding and decision-making. It uses procedures and information systems to collect, process, store, display, and disseminate information (). Information management is the handling of knowledge acquired by one or many disparate sources in a way that optimizes access by all who have a share in that knowledge or a right to that knowledge ().
According to (2002) the private sector intelligence and security is necessary in order for companies to profit for the interest of the owners, shareholders, and mangers. The marketplace intelligence or the competitive intelligence is the most significant area of the private investigation sector that focuses on the knowledge management and information utilization for the benefit of the business organization. The market intelligence has been popular due to the drive of the Society for Competitive Intelligence Professionals (SCIP) to encourage the members of the private industry to make use of intelligence in undertaking their business processes. In this regard, competitive intelligence will contribute to the business decision-making of the stakeholders of the company through access to important information outside the organization.
However, the collection-analysis process of the concept of competitive intelligence is most critical when it comes to the strategic planning of the company particularly those that operate in the international market. The media as well as the academic sector have not been very adept to such subject as evident in the limited literature tackling the issues and implications of practicing competitive intelligence by the business sector. But undeniably a very busy network of professionals is involved in the business of political risk analysis that provides information and recommendations to prospective investors that are interested in starting up businesses overseas. Most of the professionals in this career are concerned to in the social, political, and economic information of developing countries along with other business environment or setting where business deals present dangers to the entirety of the organization (, 2002).
According to (2001) the current business environment demands the need for newer business systems in the form of business intelligence systems (BISs) in order for business organizations to grow. Business intelligence systems require vision, money, and patience for their development as well as implementation. Business intelligence focus on full understanding of knowledge and information derived from data through effective way of access and synthesis processes using data mining tools. These tools allow organizations to sift through fundamental information for business intelligence use particularly those that provide data about customers, supplier, internal transactions, and other aspects of the business transactions. Data warehouse applications such as catalog, index, and cross-referencing systems are used for the convenient archiving, retrieval and use of collected information. In this regard, basic business data are needed to be transformed into “actionable business intelligence in order to assist decision-makers of the company on what to do.
Among the information systems that are directly related to business intelligence include (1) knowledge management systems, (2) on-line analytical processing systems, (3) decision-support systems, and (4) executive information systems. All these facilitate comparisons, analysis trends and business patterns, and current and historical information presentation to the decision-makers of a particular organization. Hence, theses systems help decision-makers to make informed decisions that will affect all aspects of the operations of the company by providing thorough information and understanding of its long-term goals and objectives (, 2001).
The business intelligence model (BIM) highlights the collection of business information from existing information systems in the operations, work management, procurement, inventory, customer satisfaction, and human resources of the business organization. More than establishing relationships between entities and assets of the company, BIM summarizes and aggregates incoming data for immediate processing to be provided in an accessible format along with numerous and multi-level critical reviews and analyses of the new data to provide in-depth understanding to the people who will use them in the company. The model combines multiple, predetermined data structures and metadata in relational database in which the standardized data warehouse model combines entities, attributes, relationships, and business rules in order to give enterprises ready access to assets, facts, dimensions, events, real time information, and organizational hierarchies necessary to facilitate timely business decisions ().
Among the characteristics of BIM include (1) standards-based architecture and design, (2) facility to store and manage static data, (3) facility to store and manage dynamic (real-time) data, (4) ability to integrate data from multiple sources, (5) summarizes data for decision support and analysis, (6) aggregates data for multi-dimensional and cross discipline analysis, (7) provides data suitable for analysis over extended periods of time, (8) oriented by business area, function or subject, (9) provides integrated information from across the entire organization, and (10) provides cleansed, reliable data for other business areas such as ‘data marts’ or DSS ().
Figure 1. The Business Intelligence Model
Source:
Today most companies find that it impossible to create any kind of sustainable competitive advantage based on product alone. It is common knowledge that every one of the successful companies sought and found a precise understanding of how it could create a customer-centered competitive advantage. Business firms invest on researches that will define their target customer groups that they believed they could serve best. Every business person is determined to know what kind of work they would and would not do for their customers and, in turn, they carefully learn how to fulfill the needs of each kind of customer in their target markets. & (1996) emphasized the idea to take advantage of the competitive situation not just by being better in how that product gets sold, serviced, and marketed at the customer interface. It requires that companies create breakthroughs in how they interact with customers, and design a way of interacting that makes an indelible impression on customers, one that so utterly distinguishes them from others that it becomes a brand in itself ().
Understanding the dynamics of the competitors in the industry helps assess the potential opportunities of every business venture by differentiating the similar products or services offered by the company against other business organizations. As such, it is necessary to realistically assess potential levels of profitability, opportunity and risk based on five key factors within an industry so as to determine the long-term profitability of a market or market segment (, 1998). According to and (1987) competitive intelligence (CI) is the process by which organizations gather actionable information about competitors and the competitive environment and, ideally, apply it to their decision-making and planning processes in order to improve their performance. CI links signals, events, perceptions, and data that appears unrelated into sensible patterns and trends concerning the business environment to which an organization’s decision-makers act upon. Moreover, public sources are normally used to find and develop information on competition, competitors, and the market environment ( & , 1987). With regards to ethics CI is legal ( & , 2003).
Porter’s Five Forces Model highlights the interplay between the suppliers, buyers, new entrants, substitutes, and industry competitors in order for a business entity to gain competitive advantage. When it comes to suppliers, an organization that offers products as well as services also depends on suppliers that deliver the company’s raw materials. This condition leads to the buyer-supplier relationships within different industries. Such relationship is directly influence by the changes in the supply and demand variables based on the existing needs of the consumer population. The influence of the supplier is defined by its ability to dictate price and influence availability of materials and their ability to (a) increase prices without suffering from a decrease in volume, (b) reduce the quantity supplied, (c) organize in a formal or informal manner, (d) compete in an environment with relatively few substitutes, (e) provide a product/material that is a critical part of the end product or service, (f) impose switching costs on their customers when they depart, and (g) integrate downstream by purchasing or controlling the distribution channels (, 1989).
The power of buyers describes the impact customers have on an industry. When buyer power is strong, the relationship to the producing industry becomes closer to market conditions wherein the buyer has the most influence in determining the price. As such the bargaining power of buyers increases when they have the ability to (a) make agreements with other companies providing similar products and services, (b) purchase a product that represents a significant fraction of the expenses incurred by the company, (c) purchase of a product that is undifferentiated, (d) incur low changes in costs when they change vendors, (e) be price sensitive by bearing in mind the options available, and (f) integration to purchase the goods of the suppliers (, 1989).
Meanwhile, the possibility of new companies entering the industry influences the pace of the competition. Thus, the key is to evaluate the methods of entry and exit for a new player to the industry. Although any company should be able to enter and exit the sector, each industry presents different levels of difficulty influenced by economics. These unique characteristics of the each industry are referred to as barriers to entry which may come from different aspects of the business ranging from supplies to technology. They seek to reduce the rate of entry of new entrants which leads to maintenance of a level of profits for the existing players (, 1989).
“Substitute products” as those that are available in other industries that meet an identical or similar need for the end user. As more substitutes become available and affordable, the demand becomes more elastic since customers have more alternatives. The treat of substitutes often impacts price-based competition since substitute products may limit the ability of firms within an industry to raise prices and improve margins. Other concerns in assessing the threat of substitutes include the presence of new technologies that can contribute to competition though more diverse and economical substitute products and services. A segment is unattractive when there are actual or potential substitutes for a product (, 1989).
Lastly, firms strive to secure a competitive advantage over their rivals. The intensity of rivalry varies within each industry and these differences can be important in the development of strategy. Industries that are “concentrated,” versus “fragmented,” often display the highest level of rivalry. In pursuing an advantage over its rivals, a firm can choose from several competitive moves: (a) changing prices, (b) improving product differentiation, (c) creatively using channels of distribution, and (d) exploiting relationships with suppliers (, 1989).
Figure 2. Porter’s Five Forces Model
Objectives and Deliverables
In order to meet the expected outcomes of this research proposal, the researcher is duty-bound to attain the following aims and objectives of this particular research study:
1. To find out the advantages and disadvantages of utilizing competitive intelligence in the business sector.
2. To determine the reasons why NLNG Ltd management decided to undertake strategic change migrating from business intelligence to competitive intelligence.
3. To explain the processes utilized by NLNG Ltd in realizing the goals of competitive intelligence in the context of the company.
4. To enumerate the implications of the perceptions, attitudes and behaviors of the members of NLNG Ltd management and staff involve in delivering the goals of competitive intelligence.
5. To analyze the implications of the practicing competitive intelligence in the industry where NLNG Ltd belongs to. .
Project Plan
A data or information analysis plan was prepared to organize the information collected orderly so as to make the presentation of the results more comprehensive as well as to make sure that research objectives are achieved and the research questions were answered. In summary, the researcher will undergo four major phases to complete the study:
Phase 1: Problem Identification for Research This involves reviewing existing theory, research, and practices from professional literature. This process helped integrate theoretical perspectives and empirical findings with the own understanding of the problem, and discern the aspect of the problem the researcher want to research and learn more about. Phase 2: Administration of the Instrument. After reviewing literature, the researcher will formulate questions for the survey and makes a set of guide questionnaires for the interview. These are then presented to the adviser for validation purposes. After this the researcher initiated a process of building collaborations with the respondents who participated in the study.
Phase 3: Data Collection and Analysis. In the third phase, the researcher will collect and analyse data for the purposes of identifying critical contextual variables specific to their setting. These data will enable the achievement of a specific understanding of the problem. Phase 4: Data Synthesis and Generation of Recommendations. The researcher will synthesize the findings from the previous phases and relevant previous research to modify existing hypotheses and account for different factors that will transpire during the analysis, as well as generate recommendations based on new understandings. During this phase, practice-based recommendations for action will be generated.
The schedule of activities that the researcher will need to undertake in order to complete this particular research endeavor is illustrated in the Gantt chart below:
Data Gathering
Data Analysis
1st Draft
Additional Data
2nd Draft
Finalization of Paper
Week 1
Week 2
Week 3
Week 4
Week 5
Week 6
Week 7
Week 8
Week 9
Week 10
References:
Credit:ivythesis.typepad.com
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