Competitive business intelligence gathering and analysis
Intelligence systems are providing an answer to the avalanche of
information in science and business.
Biotechnology companies succeed or fail because of many reasons. Typically,
the chances for success become greater with outstanding science and technology,
a strong patent position, an effective and realistic business model, financial
staying power, and nothing less than outstanding people at the scientific,
management, and board levels. Focusing on the needs and habits of outstanding
people, top-flight business and science managers are always very well informed
about their field and their industry as a whole.
The ability to gather and analyze effectively business and corporate intelligence
is a major advantage for all practitioners in high-tech industries, especially
biotechnology, which is characterized by an avalanche of information that
is both science and business related. What is needed is either a dedicated
or a virtual business intelligence system that delivers intelligence digests
to decision makers in a timely manner and in a format that enables them to
make decisions pro-actively. There are some excellent and long-standing examples
of such systems deployed in the manufacturing and service industries, which
can be adapted for use by almost any biotechnology company. In fact, the information
gathered for the articles in this compilation was collected, reviewed, analyzed,
and reported by using a system very much like what will be described here.
Fundamentals I use the term "competitive information" to mean data about
competing companies as well as data that are not necessarily about our competitors,
but that make us more aware and therefore more competitive. Examples
include advance notice of regulatory policy or patenting changes nationally
and internationally, the latest technical advances from non-competitors that
may be relevant (e.g., advances in miniaturization from electronics companies
that may lead to better "chips" for genomics).
Another fundamental concept is that of "intelligence," which
is different from "information". By "intelligence,"
I mean actionable information, that is, data turned into knowledge that in
turn is actually used for something (the response to such knowledge may well
be inaction, which is just as valid a response as action itself, depending
on the circumstances). The US National Security Agency gives the following
illuminating definition of "intelligence" in this context: it
is "...knowledge and foreknowledge of the world...[that is]
the prelude to...decision and action"1. The term
"foreknowledge" refers to the future and its evaluation relative
to the present. The phrase "prelude to decision and action" focuses
on the need to have some kind of system in place whose aim is to capture the
value of the data gathered and its analysis that will lead to a business response.
For high-tech industries in general and biotechnology in particular, the effective
anticipation and pro-active response to future developments is a critical
component of success, as necessary as important patents or a laboratory breakthrough.
Finally, a competitive business "intelligence system" is defined
as "the organizational means to systematically collect, analyze, and
disseminate information as intelligence to users who can act on it"2. This definition makes a specific reference to those individuals
in a company who decide to act based on the filtered and actionable information
that is presented to them. It is critical to realize that simply gathering
data for its own sake in a corporate environment is of very little use to
anyone, unless it helps determine some kind of action or response, if necessary.
Examples Intelligence systems as described previously are well known in areas other
than biotechnology. According to a 1993 survey by the Conference Board3, 5% of US multinational firms and 9% of European multinational firms
have complete competitive intelligence systems embedded in their operations.
These companies are typically from the manufacturing or service sectors, where
the presence of a competitive intelligence system is a necessity, given product
life-cycles and the extraordinary competitive circumstances in which such
companies find themselves.
The examples in Table 1 show that intelligence
systems are supported typically by advanced information gathering and analysis
technology. Second, these systems deliver specific types of information that
are important strategically to each company in its own context, for example
marketing or competitor-specific information. Third, all these systems have
specific recipients for their products, and not everybody is the recipient
of the output from such a system.
Table 1. Examples of business intelligence systems
The specifics of the biopharmaceutical sector are somewhat different from
the examples in Table 1. First, all major companies
and even some of the smaller ones have some sort of in-house library service
that gathers systematically or on-demand, stores, and presents basic clipping-service
type abstracts and reports to whoever wishes them. This is not, however, an
organized intelligence system as shown in Table 1.
However, such companies often have so-called technology assessment functions
and even dedicated offices. There may be one in Europe, one in the US, and
one in Japan, each monitoring science and business developments and focusing
attention on opportunities for licensing and collaborations, as well as providing
basic competitor monitoring. As such, these company technology assessment
offices can be thought of as opportunity identifiers, and not merely as threat
alert services4, and a good business intelligence system should
be able to do both.
One interesting aspect of such technology assessment offices or functions
is that they often report on pre-defined triggers or "hot" events
that have been identified as preambles to scenarios that require immediate
responses. One example of a trigger event is the reporting of successful phase
II or III clinical trial results by biotech companies. This means that there
is a very high probability that a product will follow, which is a good time
for a marketing alliance from the perspective of a pharmaceutical company.
Hence, foreknowledge or anticipation of successful phase II or III results
is a key trigger event in the biopharmaceutical sector, and is a key deliverable
by competitive intelligence systems in the field, together with patents issuing,
major scientific announcements in the literature or at conferences, and even
personnel changes.
As a further example, many of the top pharmaceutical companies participate
in the so-called Pharmaceutical Documentation Ring (PDR), first established
in 1958, and with a total of 29 members as of July 1999. This network was
established in part to enable its members to exchange non-confidential information
about information gathering and analysis methods. The PDR holds regular conferences
where issues including archiving, data mining, document searching, etc. are
discussed5.
A typical competitive intelligence digest The end-product of a competitive business intelligence system is what is
known as a competitive intelligence digest, which is a representation of the
actionable information tailored to the requirements and needs of each company.
The real nature of the information needs of biotech or companies from other
sectors determines the exact structure of such a digest, and understanding
the nature of these information needs is critical to the success of such an
effort.
Ultimately, a biotechnology company requires two major types of information:
one is science-related and the other is business-related. It is important
to note that in both cases the nature of the information is essentially the
same. What is required is knowledge of one's own field, of related fields,
and also of the broader contextual parameters that characterize the industry
as a whole.
Therefore, a good intelligence digest would have to deliver actionable
information in all three information areas: namely specific, broader, and
contextual. It is also important to remember that if actionable information
is based purely on information that is gathered from third-party public sources,
one runs the risk of delivering actionable information that carries with it
the same biases as the source, which is a very significant danger indeed6. The key to good competitive intelligence digests is that they stem
from intelligence systems that begin with information that is publicly available,
and use this as a basis to get further data directly from human sources. In
other words, the intelligence system begins by gathering public data, and
then this third-party data is integrated with information obtained directly
from human sources. Finally, company-specific context is used to deliver this
information in an actionable format, namely one that will enable decision-makers
to act in an informed way. A typical working structure of a competitive intelligence
digest is shown in Figure 1.
Figure 1. The working structure of a typical intelligence digest
Biotechnology has many good examples of the usefulness of systems such
as the one above. For example, it would be very difficult to be aware in a
pro-active manner of developments in all the platform technologies of modern
biotechnology, such as genomics, proteomics, combinatorial chemistry, or high-throughput
screening. Combinatorial chemistry alone has at least 180 participating companies7. Passive information gathering would be totally inadequate and would
lead to essentially follower-type behavior.
Implementation Establishing an effective business intelligence system is cheaper and easier
than one might first think and need not be the purview of a few. First, it
is not necessary to hire extra people for the task. In all companies, senior
scientists and managers actually do the work that would be required to produce
an intelligence digest. However, it is also true that these tasks are simply
never integrated into a digest, and most companies do not have a person whose
responsibility it is to perform this integration for the benefit of others.
Depending on the size of the company and its needs, an intelligence system
can consist of anything from one to five or more people who already work for
the company, with their associated costs, but nothing more. This would be
an example of an essentially virtual intelligence system, since it does not
have full-time employees. The system would require no more than two full days
per month to deliver a monthly digest, which is a good frequency for this
(anything more regular would probably be noise)8. Since a critical
component of the process is the delivery of actionable information, this would
be the responsibility of one or two senior individuals. The system here is
one that any company can put into place.
Conclusions In the biotechnology industry, leverage is everything: people, financial
resources, technology, and patents are all leveraged for success. A key contributor
to successful leverage efforts is a very simple one: typically, whoever knows
more in advance and responds to that knowledge quickly wins. This is where
competitive business intelligence systems come in. Since common household
company names have had such systems in place for years, it seems reasonable
that biotechnology companies should also have such systems, and indeed some
do. With a virtual system akin to the one described here, the resources required
to implement it are not significant, whereas the rewards are likely to be
very important for the company.
