Identify the Best Market Intelligence Advisor for Your Board

June 13, 2012. There is little doubt outstanding market intelligence directors bring great value to their boards. But how do you spot such talent? What distinguishes them? Where can you look for them?

We ask Hans Hedin, author of the Handbook of Market Intelligence for his comments.

Q: What qualities set the best market intelligence leaders apart from their peers?

“We know market intelligence directors who have been voted “Most Valuable Employee of the Year” and others who sit on management boards. Such senior market intelligence executives are able to raise the strategic thinking capability of entire companies by their vision and ability to support and challenge existing strategies or thinking. At Philips Healthcare for instance, the vision of the intelligence team is to “focus on solid growth” with “visible value creation”. Others have linked their market intelligence program to strategic targets such as technology leadership, global service capability or other strategic visions.

I’ve noticed some common traits that define the best market intelligence leaders. They tend to be very curious, analytical and natural team leaders. They are also great storytellers with the capability to visualize market situations and create synthesis of information and concepts in creative ways. They are always well connected within the company, understanding the political scene and the intelligence needs of many different stakeholders – and how to manage them.”

Q: Can you give some examples of what these leaders have done which have truly made a difference to their organizations?

“Some of the greatest challenges facing CEOs and global organizations today are understanding market growth, identifying new business opportunities, facing new competition and managing changing customer needs. The best market intelligence managers are able to address such issues by identifying new business opportunities in adjacent or completely new markets, preempting competitor product launches and ensuring that management constantly hears the voice of the customer.

Let me give you some examples.

At Cisco, the intelligence team creates new customer leads by identifying new potential customers and analyzing when customers need to upgrade their products. This helps the sales people to cross-sell, up-sell and develop a just-in-time relationship with the customers.

At Philips Healthcare, the intelligence team has been able to offset major new launches by their key competitors by understanding the market scenario. They proactively analyzed the offerings and provided “beat sheets” for the sales force so that they would know how to position their own offering in a positive way. This knowledge also fuels the product development process at Philips.

At Siemens, the intelligence team conducts win ““loss analysis for most deals. For management to hear this straight from the customer, instead of having it filtered through the sales force, provides them with a thorough understanding of marketplace reality.

At Ericsson, the intelligence team has developed a corporate wide forecasting program that is related to market growth, sales and market share development. By having a unified picture of the future, there is less internal debate and wishful thinking by local managers. It also provides a “helicopter” perspective that management needs in order to define strategies and set priorities.

At Stora Enso, the intelligence team created what they call the Pathfinder project to help the company think out of the box and identify new opportunities. A shadow cabinet comprising the brightest up-and-coming managers from all around the world was created to ensure diversity and inflow of new ideas. Their task is not only to identify interesting business opportunities but also to develop a business case showing how the company can develop the opportunities.

Market intelligence should not be a stand-alone process. As these examples show, the intelligence is integrated in various processes, from sales and product development to strategy development.

By focusing on the strategic value generation the entire organization needs, rather than piecemeal projects or just the process of research and analysis, leading market intelligence advisors can really bring strategic value to the organization in ways that really matter. The “focus on solid growth” intelligence program set in place at Philips Healthcare for instance, helped the company fend off a competitor’s new product launch. Indeed, it can be said that the market intelligence function at Philips Healthcare has enabled it to remain the market leader in 14 out of its 16 markets.”

What have leading market intelligence directors been able to achieve internally that have impressed you the most?

“I would have to say that it is the ability to influence the culture of an organization – even employees outside the intelligence function.

They are not “stuck” in just the research and analysis and are able to consistently provide a higher degree of conclusions and recommendations compared to their counterparts. You can see such consultative skills at work in companies like Cisco Europe, where developing consultative skills has been a key development goal, and at Merck, where the performance of the intelligence team is evaluated based on how much time is spent on providing insight and recommendations in addition to data crunching.

The best intelligence leaders are also skilled at what I call “co-creation” of intelligence. By this, I refer to how they embed intelligence into all key business processes and ensure the active participation of people from all aspects of the organization. Examples of this might be scenario workshops for senior management, war games for business development people and competitor beat sheet creation for sales people.

The intelligence director at a US$ 3.8 billion service provider, who is the only full time market intelligence staff in the company, has been able to develop several networks within different sales teams and divisions who help him collect, analyze and use market intelligence. The more than 500 intelligence analysts at IBM on the other hand, work closely together with the functional practices within the company in order to ensure that intelligence gets captured and used close to the business.”

Q: What do you think is an ideal size for a global team? Are there any rules of thumb?

“There doesn’t seem to be any ideal size. Some companies have only one person with the title, Intelligence Director, who oversees the outsourcing of all intelligence work to consultants, while others have over 500 analysts around the globe.

Some industries tend to have larger market intelligence teams than others. You may find global consumer and retail companies with over 25 people in their market intelligence teams, whereas that number could be just 5 for manufacturing and industrial companies or over 10 for financial services institutions. The more complex and fast changing the business is, the more resources need to be devoted to intelligence.

The 2011 Global Market Intelligence Survey by M-Brain (formerly GIA) revealed some facts about how companies with world class market intelligence functions structure their teams. Firstly, they have slightly larger market intelligence teams than their peers, with fewer layers between them and their CEOs. Top management makes up a larger proportion of their internal clients. The data also showed that such companies get contributions of intelligence from substantially more employees. Whereas the average number of contributors was 95 for all companies, it was 137 for world-class companies.

But as a general rule of thumb, companies should centralize general activities such as market intelligence training, frameworks and intelligence tools development, best practice sharing, and information source management. Where you need to be close to local intelligence users or sources, such as market research and analysis, stakeholder interaction and needs analysis, market intelligence activities should be localized.

You can also outsource parts of the intelligence work without increasing headcount. Today, M-Brain (formerly GIA) supports over 30.000 decision makers in over 140 organizations by providing information, analysis or software tools on a regular basis.

For companies that are asking about the ideal size of their market intelligence programs, I would recommend that they benchmark themselves with best in class companies and industry peers. We have supported many clients with this, using data from the most recent Global Market Intelligence Survey. You will get to see if you invest as much as your peers in terms of the number of analysts and budget. While I have said there is no rule of thumb in terms of numbers, this benchmarking exercise can be really valuable when it comes to planning the development of the function. If you are only investing 60% of what your competitors’ budgets are, you might want to reconsider what you are doing, compared with the competitors’ understanding of your industry.”

Q: Where should CEOs look to recruit their market intelligence talent today?

“One approach is of course, to recruit internally. New recruits need to have analytical mindsets, good networks and have worked with strategy, business development or sales.

Or you can look for external resources, recruiting people who have been professionally trained and have work experience in market intelligence. Countries like the US, Canada, France, Israel, UK, Finland and Sweden offer good talent pools, as they are quite advanced in using competitive intelligence, as shown by the number of conferences, university courses, executive training courses, books and consulting companies present over the past 20 to 30 years.

The US also produces a lot of entry-level talent, with their university programs on market intelligence, or competitive intelligence, as it is more commonly known in the US. There are almost 30 universities there that offer courses on the subject. The program at Pittsburg University has created some of the highest numbers of Ph.D.s on the subject.

In Europe, you find university courses dedicated to market intelligence in countries like France, Italy, Germany, UK, Finland and Sweden, but they are not as common as one would like. France now plans to integrate the subject of intelligence into most business courses.

Most teaching on intelligence seems to be embedded into courses related to strategy, finance and marketing, but in practice the level of intelligence within these courses is rather basic. The situation is somewhat similar to the study of marketing, which took some 20 to 30 years before the subject emerged as an academic field of study.”

Q: Where should they recruit their market intelligence talent in the future?

“Countries and companies that can instill a true sense of curiosity, team spirit and a “nothing is impossible” attitude will be the best creators of talent in the future. I am not sure that the old business schools will meet that requirement in the future. We are therefore monitoring closely how intelligence as a topic is treated in the BRIC countries and other countries where high growth development is the goal.

Industry trade shows and events are also good scouting grounds for senior talent. Take M-Brain Conferences (formerly GIA Conferences) for example. With its strong word-of-mouth recommendations and focus on providing a forum for specialized education and networking, it attracts very senior analysts and vice presidents for market intelligence. This year, we will hold one in London in June and one in Toronto in the fall.”

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