The cost of not knowing

[Jens Thieme]

As companies start closing CI departments again I was wondering how to proactively secure these insight producing entities in times where not knowing crushes the entire world economy.

Are there any models that could be used to tell those C-Level executives on a firing spree: "You think you need to cut a salary or three? Have you considered the cost of not knowing though?"

There has never been a better time to proof that point. And it could help saving these crucial CI departments.

Anyone wants to share ideas how to model this out to be thrown at those C-Guys?

[Alan S. Michaels]

Hello Jens, whatever model you come up with, I believe it should include thoughts on psychology and group behavior, including the group behavior of the executive team and the group behavior of peer companies in an industry, because their collective belief systems often dictate their actions, especially during times of dramatic change with little time for scenario planning to compare potential outcomes based on a set of different actions taken. So, unfortunately, known cost reductions today for survival often trumps likely higher rewards tomorrow. For those few companies that have positive cash flow and are able to take your advice, today's environment offers tremendous opportunities. Cheers, Alan

[Ellen Naylor]

Hi Jens,

I think we're treading into new territory in these uncertain economic times, so the firing sprees will continue. I think that fear unfortunately overrides the cost of not knowing, as do the costs of any business function that management does not feel is essential. I think that companies who are willing to keep "thinkers and strategists" on board, will come out ahead when the economy does recover. I don't have any examples to cite since we are in unchartered waters.

It would be interesting to hear from people who have been let go from their companies during this downturn to get their advice. I won't name names, but we have a number of long-time CI professionals who are now on the street. Likewise it would be interesting to hear from people who have managed to keep their jobs.

Here is what I have noticed as a consultant: training programs and "CI consulting" are not seen as "necessary" at this time, but there is always demand for good, solid research, whether it's just strictly CI studying company's operations to uncover either process improvements (sales intelligence/win-loss analysis); personality analysis of a competitor's or a targeted acquistion company's management (like Alan mentioned), or opportunity analysis, which is uncovering some opportunities to make more money by either entering new markets, tweaking products or acquiring someone else. I think now what's practical and more immediate is what will make the sale.

ATB, Ellen

[Nimalan]

Hello,

Interesting point. I would like to present a different view here though. We do talk about the value of CI and how CI can help in a downturn. If the company management realizes this why would they fire? But then the question that comes back is "Why should we not fire?". Sales and Marketing teams who are getting hit on the front lines are increasingly blaming the CI teams for finding themselves in this mess.

Questions like why did not the CI function help us avoid this in the first place instead of coming now and saying "use me and I shall get you out of this"?

Yes, while its tough to see the CI department getting the axe in most places.. I guess we also need to introspect and see if CI as a function does add clear value to organizational strategy. Does it communicate to top management what they really need to know?

[Chris Hote]

Hi Jens, This is a perfect topic and I think there are two view points once may consider. I added few recent real-life examples from CI pro who could justify their function and value-added within their company.

1 - From the short term perspective, many companies are looking at securing their core business: Simply put, identifying new contracts and securing existing customers.
As an sales or marketing manager:
What if you don't know a potential client is looking at similar products you sell?
What if you don't know rumors reflect quality issues about your products?
What if you don't know rumors promote some good features about your products?
What if you don't know the impact of PRs and advertising campaigns?

CI can help knowing your customers who are the biggest asset companies have now. Know your customers to better communicate with them and to better fulfill their needs.

2 - From the medium term perspective, companies may look at mitigating the competitive risk.
As an executive:
What if I do not know where and who my competitor hires?
What if you don't know your supplier builds ties with competition?
What if you don't know competition changes its pricing strategy?

CI can help adjusting company strategy with optimal leverage.

I am confident Ning members faced those situations and could put specific figures behind those not-knowing scenarii.

Hope this helps the CI community.
Cheers