Competitive Intelligence (abbr. CI) is the collection and processing of data from various sources for the development of management decisions in order to increase the competitiveness of a commercial organization, carried out within the framework of the law and in compliance with ethical standards (as opposed to industrial espionage), as well as the structural unit of the enterprise that performs these functions. Another definition of the concept of "business intelligence" is a special type of information and analytical work that allows collecting extensive information about legal entities and individuals without the use of specific methods of operational-search activities, which are the exclusive prerogative of state law enforcement agencies and special services.

Other common names for competitive intelligence are business intelligence, business intelligence, analytical intelligence, economic intelligence, marketing intelligence, commercial intelligence.

History

The use of intelligence in business activities did not begin at the end of the 20th century. If the ability to analyze and draw conclusions is considered as an integral part of the functions of the brain, which raised man above the animal world, then it should also be recognized that man uses this ability in absolutely all areas of his life. Therefore, business is just one of the many areas of application of intelligence. Both in the past and now, entrepreneurs do not always achieve ideal business results. However, it can be confidently stated that entrepreneurs who relied on intelligence always turned out to be more successful than those who did not.

The first steps of competitive intelligence were inextricably linked with industrial espionage. The cost of such events was very high, so they were carried out either by the state or by private companies on behalf of the state. Nevertheless, even in those ancient times there were exceptions to the rule.

The date of the appearance of the first documented competitive intelligence is considered to be the end of the XIV century. At that time, the House of Fugger in Augsburg, Germany, for the first time in the world, began to use elements of competitive intelligence in an organized and permanent manner. The Fuggers distributed the so-called "news manuscript" to their key employees in the field. This document contained purposefully selected and analyzed commercial and political information from all points of interest of the company, and made it possible to make management decisions. Experts believe that this is what allowed the Fuggers to take a leading position in key industries. Subsequently, the Fuggers created the first banking house in Europe.

A few striking examples belong to the later period that can be attributed to competitive intelligence in its modern sense. American authors write that the Rothschilds at the end of the XVIII century had two hundred agents. The results of the activities of this network were made available to the government of England, which fought against Napoleon. Thanks to his informants and their contact with government and military structures, Nathan Rothschild learned of Napoleon's defeat first in London. The Rothschilds had a monopoly on this information for a very short time, but it was enough for them to take control of the most technologically advanced direction of the time, the textile industry.

According to the American author Herbert Meyer, in the period between the two world wars, the Japanese textile industry defeated its British and American competitors through methods such as price war, state protectionism, and illegal copying of technology. The Japanese state even went so far as to compensate its firms and enterprises for high customs duties.

Industrial espionage has been and remains the "horse" of Japanese progress. This was, according to a number of experts, the only way to step out of isolation and feudalism into a technological society. For example, the modern history of Sony originates from the American pre-war electric record player.

With the development of modern technologies, the share of industrial espionage in the work of Japanese companies is sharply decreasing due to an increase in the share of competitive intelligence. This trend of moving away from industrial espionage and the prevalence of competitive intelligence in the work of companies is observed today all over the world.

Competitive intelligence in its current form received a strong impetus for development in the mid-1980s. The founder of competitive intelligence of the modern period is considered to be Xerox, which faced competition from Japanese manufacturers. It was a war to the death, as the Japanese entered the American market with retail prices below the cost of Xerox. But Xerox, through its Japanese subsidiary, created what is now called benchmarking, and then adapted and applied intelligence technology to the business world as much as possible. Other major American companies followed suit. A few years later, competitive intelligence began to be used in Europe, and then around the world. This period can be considered the final separation of competitive intelligence into a separate area of activity.

Today's advances in technology—primarily communications and computers—have made full-fledged intelligence technically and financially accessible to large, medium, and even small companies. That is why competitive intelligence is now spreading so rapidly in all industries and at all levels of the economy.

The information and analytical activities of consulting firms and competitive intelligence units in companies are increasingly based on modern information technologies and adopt the latest achievements in the field of artificial intelligence. With a successful combination of these technologies with developments in the field of psychology, with an eye to legislation, a successful competitive intelligence service is obtained.

By the early 1990s, international and national societies of competitive intelligence professionals had been formed, which, through the publication of periodicals, conferences and trainings, made it possible to organize the exchange of experience between specialists. The most well-known societies in the world are SCIP with headquarters in the United States and Competia with headquarters in Canada. 

At present, properly organized competitive intelligence is not limited to the study of competitors, but works in relation to the entire environment in which the enterprise lives. In particular, the political and legislative situation, personnel movements of people whose activities may affect the company, experts who can advise on a particular special issue, new technologies, the company's own customers and suppliers are studied.

The successes of competitive intelligence were so obvious that state intelligence services, in turn, adopted methods of working with open sources of information, honed by specialists of the Kyrgyz Republic. However, if these methods turned out to be vital for competitive intelligence, then for state intelligence they perform auxiliary functions.

State-owned enterprises and institutions today also use such methods of competitive intelligence as systems for working with open sources of information.

Competitive intelligence and the global market

In the world market, competition for resources and market shares necessary for business is intense, and sometimes takes on cruel forms.

In the struggle for survival (no matter whether we are talking about economic survival or any other), the chances of success are those who competently use intelligence in their activities. Competition in the world is growing, and competitive intelligence, if used effectively, can become a decisive factor that can lead to success even for a company that was threatened with bankruptcy.

Goals and objectives

Competitive intelligence solves the following tasks:

Information support of the process of developing management decisions both at the strategic and tactical levels.
"Early warning system", that is, drawing the attention of decision-makers to threats that could potentially cause damage to the business as early as possible.
Identify business-friendly opportunities.
Identification (together with the security service) of competitors' attempts to gain access to the company's classified information.
Risk management to ensure that the company responds effectively to rapid environmental changes.
The above tasks of competitive intelligence are key for the company, they serve to achieve the fundamental goal of the existence of the competitive intelligence unit – to provide the company with a sense of security due to the awareness of the fact that the fate of the enterprise is in its own hands and that the company will not suddenly become a victim of circumstances or someone's hostile actions.