Insights & Reports > Business Intelligence: Don’t fly blind

Pilots have a saying. “Keep your eyes out of the cockpit – a mid-air collision could ruin your whole day.” The point is that it is all too easy, when flying a plane, to fixate on the array of controls, dials, and displays inside the aircraft. The real world, outside, is where the action is.

The same is true when piloting a business. While in-house data may let you understand previous customer behavior and market dynamics, this may not be enough. In fact, it could be actively unhelpful. Past correlations may have grown obsolete; people, institutions, and policies may have changed; market dynamics may have shifted or even reversed. Only new, external data can reveal what is happening, especially in times of immense change, like the present, when companies, markets, and whole economies veer from familiar paths. Moreover, an excessive focus on one element of the outside world is just as dangerous as looking only inward. Often, companies are too interested in competitors at the expense of other external partners: possible acquisition targets in adjacent markets, suppliers, and – most critically – customers. Here is where business intelligence can help.

Your strategic environment is a 360 degree space:
facing in only one direction means turning your back on potential threats or opportunities. Only by going out into the multi-dimensional, real world, collecting hard-to-find information, and making sense of it will a business be able to plot a path to success. Business intelligence, properly applied, helps you see and prepare for all contingencies:
what the French call “défense tous azimuts” – defense in all directions.

For senior executives, amid today’s economic turbulence, it may not seem clear even which issues require greater insight.

To draw an analogy, after the Eastern Bloc collapsed, national intelligence services had to re-focus. It turned out, though, that other, unexpected threats were identified as a new world emerged. Similarly, companies have to have good business intelligence on growing risks and opportunities as the world faces new economic realities.

For example:

• Energy companies have tied up large supply contracts – at last year’s prices. Does thatendanger your key clients or create acquisition opportunities?
• Some large investment banks have merged, disappeared, or lost staff, but smaller new entities are emerging. Are they potential new clients?
• Economic stimulus efforts in many countries are creating a surge in requests for proposal in key markets. Are competitors beating you to these – through fair means or foul?
• Emerging markets posed some of the greatest opportunities for business in the 2000s. What decisions were made in past years that might now need to be rethought – by you or by your clients? Have they faced up to the tough issues that might define your market in the next decade?

The key to successful intelligence is having the expertise to know what to look for, and where – from analyzing mountains of data for potential patterns to asking the right individuals for specific information – in order to provide a detailed picture to decision makers facing a rapidly changing environment. Using a variety of methods – data analysis and market research, but also source-based inquiries, analysis of public records and investigative techniques – will yield better results than a focus on just one.

In this publication, we give concrete examples of how to do this, and what the benefits might be. Some of Kroll’s leading experts describe five things about which companies should be thinking differently in the new economic climate, as well as how business intelligence can give executives a crucial edge in doing so.

• Check your suppliers: Difficult times will increase the number of people tempted to defraud. John Brocar outlines an innovative approach to meeting this heightened risk: think like a thief rather than a guard. This perspective can reveal unexpected weaknesses in a company’s defenses – and how best to plug them.
• Watch your competitors: They are more active than ever in trying to steal market share. Matthew Levey describes ways to keep an eye on them. This can help in creating strategies that meet threats head on, rather than dealing on the fly with unexpected damage after the fact.
• Take a closer look at your clients: Bad drivers are not the only ones hurt in crashes, and a bankruptcy at a poorly run client can bring down the best run firm. Jack Clode explains some of the ways to maintain cordial relations with customers, yet find out about any potential bad news before it happens, giving time to take important protective measures.
• Look internally – assess past purchases: Deals from better economic times may now lack their original luster. Tommy Helsby gives practical advice on how, armed with information obtained through the tools of business intelligence, companies can regain some or all of the money that may have been lost in a failed, fraudulent, or at least less than transparent, transaction.
• Look for new acquisitions: A downturn brings new opportunities, too. John Price describes how those who keep their heads as others stampede away from emerging market risk can – if they know how and where to look for the right information – purchase excellent companies in likely high growth countries at fire sale prices.

Using business intelligence should be a basic part of managing an enterprise, and finding new information from outside – not simply rehashing old data – needs to be a critical part of it. As one of our writers puts it: what you don’t know can, indeed, harm you; but if you look you might also find the piece of information that helps relaunch your business at a critical time.