Reading Your Rival's Mind



How to See Through & Stay Ahead of

Business Disruptions, Distortions,

Rumors & Smoke Screens

By Leonard M. Fuld

Crown Business -- 309pp -- $24.95

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Editor's Review

Star Rating

The Good A practical handbook for doping out your competitors' thinking.

The Bad In a world of sophisticated information-gathering tools, it's a tad simplistic.

The Bottom Line A nuts-and-bolts primer on "competitive intelligence"

Remember when Larry Ellison went digging through Bill Gates's garbage? Well, actually, it was a tad more complicated: In 2000 detectives hired by Oracle (ORCL ) rummaged through the trash of a pro-Microsoft organization. And there was a similar brouhaha a year later, when Procter & Gamble (PG ) admitted that employees had hired investigators to rifle through Unilever's rubbish for shampoo secrets.

These kinds of activities may reflect the common image of corporate intelligence-gathering. But true "competitive intelligence" (or CI, as it's often called), at least as practiced in most corporations, is hardly so cloak-and-dagger. Typically the purview of the strategy department, CI is a legal and essential corporate function that involves collecting and analyzing often public but little-noticed information about rivals.

In fact, it's so important that CI shouldn't simply be left up to the pros, says Leonard M. Fuld, one of the pioneers of the field. In The Secret Language of Competitive Intelligence: How to See Through & Stay Ahead of Business Disruptions, Distortions, Rumors & Smoke Screens, Fuld argues that competitive intelligence should be the job of all employees. Fuld's firm, which was founded in 1979, has worked with more than half of the 500 largest companies in the U.S., and he also runs an academy to teach the discipline. Secret Language is his nuts-and-bolts guide for the uninitiated. And although it's sometimes repetitive and a bit simplistic, the book is an accessible and practical handbook for reframing the way you think about your competitors.

The author's basic training utilizes both generic tools and advice and ideas from CI practitioners. For instance, Fuld describes the technique of Dale Fehringer, a former CI executive at Visa International. Fehringer would often scan ads and news clippings about rivals that he'd spread over his kitchen table, searching for faint, almost hidden patterns that might indicate their strategies. Another practitioner who recommends careful, skeptical study of competitors' public info is Mark Higgins, an intelligence-gatherer for Novartis (NVS ). Oftentimes, says Higgins, when a rival is writing and talking a lot about a drug compound, the product is probably less of a priority than something they are trying to keep secret.

In addition to information gathering, it's useful if you can put yourself inside competitors' heads. That's where war games come into play. Fuld tells how a group of Harvard and Massachusetts Institute of Technology MBA students enacted a mock "Battle for Clicks" between Google (GOOG ), Microsoft, AOL (TWX ), and Yahoo! (YHOO ). The students were divided into teams representing the four companies and then thrown a scenario curveball, to which they had to react. Readers uninterested in the online search world may find this section overly detailed, but the exercise is a helpful illustration of how to anticipate rivals' thinking.

In another chapter, Fuld lays out several practical "Internet X-Ray concepts." One of these involves sifting through anonymous job postings for rivals' "corporate DNA," or the snippets of jargon companies characteristically employ to describe themselves. For instance, IBM often uses the phrase "We strive to lead in the invention, development and manufacture of the industry's most advanced information technologies," says Fuld. When you think you detect such language, you can simply copy and paste it into google. A resulting search might confirm that an otherwise unidentified company is looking for an expert in an entirely new line of business.

Like many management books, Secret Language is redundant in places. And in an era when companies have tools that integrate feeds from blogs and Web sites, sophisticated industry-analysis reports, and complex corporate dashboards that track every imaginable metric, this book sometimes feels pretty basic.

Another gripe: Parts of the chapter "Competitive Fog," which describes how famous business leaders gather intelligence, seem a little off the point. We read how Sam Walton and Michael Dell placed a high priority on supplier and customer intelligence -- but that's different from getting a scoop on your rivals. In the same chapter, an imaginary Q&A that Fuld concocts with Nathan Rothschild, the 19th century banker who capitalized on Napoleon's defeat at Waterloo, is downright irritating.

All the same, Secret Language is a handy guide for managers trying to dope out competitors' next moves. And it's a good reminder that there's a better way than rummaging through other companies' trash cans.

By Jena McGregor

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