Missing the landscape for the bars:
Any large global company would have a list of 10-15 companies that they deem as their strategic competitors. Let’s take the Investment Management industry. The usual suspects would include BlackRock, Vanguard, T.Rowe Price, PIMCO, Fidelity, JP Morgan, Goldman Sachs and a few more such global powerhouses.
Chances are that the competitive intelligence teams would spend their time analyzing the details of each company, from assessing the information on the quarterly earnings calls to analyzing the firms’ financial performance, sector and fund performance, strategic initiatives, key leadership changes, new funds launched. Competitive insight that can shape and influence strategy. Only, does it provide a strategic insight or does it just report the past as it becomes history?
Does the combined set of competitive intelligence reports resemble this in length and size? War and Peace.
Many CEOs may not be looking for a copy of War and Peace along with their morning coffee. Leaving most competitive intelligence reports doomed to just decorate the piles of unread papers on busy executives’ desks.
There is something that can show the landscape more clearly.
How does it help?
1. Time for a picture story? In the book called “Lead with a Story”, the author narrates the story of CEO of Bristol Myers Squibb who had no time to read such lengthy competitive strategy reports. What worked was a powerful summarization of the insights and recommended action, slipped under his room in the guise of his favorite morning paper, “Financial Times.” This approach of smart visualization did get his interest and his attention. Using a host of readily available visualization tools such as Tableau, Qlikview and the works, static Competitive Intelligence can change to dynamic and crisp data stories.
2. Who’s the new kid on the street? Analyzing the data on growth in assets under management and fund performance from Morningstar, SimFund, Pension and Investments might throw a surprise. A few firms employing strategies such as multi-boutiques, non-traditional asset categories such as alternatives or multi-asset funds are gaining assets as well as demonstrating strong performance. DoubleLine Capital, MFS Investment, Dimensional Fund Advisors – names that may not have featured on the traditional must-research competitor list are suddenly in the news. Data analysis might make it easier to identify them before they become glaring headlines.
Google trend analysis and text analysis of key news items will show other companies; a slew of low-cost, online investment advisors who are using technology to drive portfolio construction. They may be dubbed as robo-advisors derogatorily but the recent fund infusions that companies such as Betterment, Learnvest, Wealthfront, Personal Capital have seen, indicate that this could, indeed, become a trend to watch more closely.
3. Finding alpha amid hashtags: Institutional Investor spoke about the investment management industry under utilizing the power of web and social media. If the index picked stocks a decade ago and created the phenomenon of ETFs and technology is picking stocks now and creating the robo advisors, can the social media pick stocks in the future and create more companies such as Motif Investing? Motif Investing – firm that has created a social investment platform using investment ideas from everyday trends. The ideas or motifs available include “Caffeine Fix“ (coffee stocks), "Modern Warfare” which focuses on companies that make smart bombs and drones and “7 Deadly Sins" which includes fast-food companies, cigarette makers and gun manufacturers. Alpha powered hashtags indeed.
Seems completely unreasonable? Or can Analytics coupled with deep domain insights help competitive intelligence analysts to paint a new landscape? One without bars? One which involves no looking over the shoulder?
Would love to hear your suggestions for driving innovations in Competitive Intelligence.