Managing Competitive Intelligence Projects



The most important place to start any discussion of competitive intelligence is with the Code of Ethics by which to conduct such investigations. The Society of Competitive Intelligence Professionals has a solid decades old code. It is:
• To continually strive to increase respect and recognition for the profession.
• To pursue one’s duties with zeal and diligence while maintaining the highest degree of professionalism and avoiding all unethical practices.
• To faithfully adhere to and abide by one’s company’s policies, objectives, and guidelines.
• To comply with all applicable laws.
• To accurately disclose all relevant information, including one’s identity and organization, prior to all interviews.
• To fully respect all requests for confidentiality of information.
• To promote and encourage full compliance with these ethical standards within one’s company, with third-party contractors, and within the entire profession.

Intelligence Systems Cycle of Operations

In the “Intelligence Systems Cycle of Operations” figure, the five basic operations of competitive intelligence are shown as a cycle because of the unending need for information. No one process can stand alone, all are necessary and add value to each other.

The process starts with Needs Identification so that the explicitly stated requirements of decision-makers can be met. Without a clear focus it is been found that competitive intelligence individuals and organizations turn into mere generators of information and bring no identifiable strategic value to their organizations.

The next step is Planning and Direction. To avoid collecting and analyzing information that is not directly relevant to management’s intelligence requirements, careful planning procedures must be part of any intelligence system.

This step is followed by the Information Storage and Processing step. Efficient intelligence systems make use of information storage retrieval and searching applications to facilitate the collection retrieval, archiving, and analysis of information. To provide competitive information that is decision specific and exclusive, intelligence systems must harness both published and unpublished sources.

Thus in the Proper Collection and Reporting step a network of internal and external human sources of intelligence along with skilled information scientists is critical to success.

Once the information has been gathered it moves into the Analysis and Production step. For intelligence to be truly decision relevant and for it to address future competitive situations, intelligence systems must apply robust analytical techniques and methodologies. Doing so moves a program from providing data summaries that talk about what competitors did yesterday, to providing analyzed intelligence that anticipates future competitive behavior and discusses implications for company strategy.

Competitive Assessment Process

Competitive Assessment Process

Hovis, and separately Langabeer were more direct in their definition of the process. In the “Competitive Assessment Process” figure, they’re more explicit that the information collected be actionable. Each of their stages focuses on the business impact of the competitive assessment. They advocated strongly that practitioners dive hard to figure out “what does the information mean” and “what will be its business impact”. The goal of their work was to convert data and information and ultimately into knowledge.

Intelligence Leads to Competitive Advantage

Merrill Brenner at Air Products took this a step further by breaking the single cycle into two cycles as shown in the “Intelligence Leads to Competitive Advantage” figure. First data is filtered and organized to create factual information – the who, what, when, and where. Then the information is analyzed to gain insights. The goal is to understand how something works or why somebody’s doing something. This creates intelligence which is a deeper understanding and insights beyond the factual information. What is key in this model is that insight is combined with experience to create the wisdom to make decisions which lead to competitive advantage. This last point is critical. The goal of the whole process is to create a sustained competitive advantage for the organization. Competitive intelligence without maintaining’s sight of this goal is pointless.

Remembering that the audience’s needs are what should drive the Competitive Intelligence process design and output formats, Jay Paap built a Competitive Technical Intelligence (CTI) methodology focused on the needs of Innovation teams and leaders. Jay modified previous methodologies, mostly derived from Jan Herring’s CIA and then Motorola work that was designed to support ongoing Competitive Technical assessments of KITs (key people, major competitors, trends), and the work of Jim Bright (the father of tech forecasting), and Dick Davis. The primary difference is that Jay’s CTI methodology has a start and an end, it is not ongoing. This is because although an ongoing CI process model works best to support senior decision makers who face continuous major strategy issues, when supporting R&D, CTI is usually supporting a one-off project, and should be set up to find potential competitors’ and partners’ intentions/capabilities in a new and unknown area (to the company).

Competitive Technical Intelligence (CTI) process

The CTI process has four parts: FOCUS – COLLECT – ANALYZE – ACT

The big differences are: (1) It does not assume a data base exists, and often there is none. (2) It does not end with dissemination, which is enough when the CIA briefs a general or the president – you assume they want to know and will listen. In industry more often than not the CTO is unfortunately an arrogant adherent to an old technology and feels she/he knows what they need. So the last step is not to “write a report” but to “sell” your assessment so that someone acts on it. Because of these differences, CTI also requires two critical support areas to get a return on the investment. They are: (a) the ability to get good information to do planning, especially when doing innovative activities where anticipating uncertain futures is critical, and (b) the ability to do what was called corporate venturing before the turn of the century and Chesbrough renamed Open Innovation thereafter.

CTI has about a 80-90% overlap with BI sources when mapped onto the business intel. Business Intelligence supports senior business decisions with ongoing intelligence on markets, competitors, customers, and technology. CTI supports innovation and project decisions, with much the same info. What is different is how it is packaged because of the difference in decisions, the varying time frame, and usually the level of detail.

Thus, clarity on upper management’s direction is important when conducting competitive assessments as the tools and techniques used to create insight are somewhat different. One point to be particularly clear upon is to know which one of two ways the organization wishes to create a sustained competitive advantage. The first is to play the game better. The second is to play the game differently.

To play the game better, focus is usually upon existing strategic and competitive positions. In this case the team is looking for gaps that exist between what is being provided to consumers and what their true desires and needs are. Key to playing the game better is to accurately profile competitors and learn from them what is working and what is not. This requires SWOT and financial statement analysis. It also requires a more periodic gathering of information, analysis, and intelligence briefings. From an organizational standpoint the competitive intelligence group should be focused on continuous improvement.

When organizations are looking to play the game differently, competitive intelligence needs to focus slightly differently. The goal is to identify new and unexploited customer segments (a new “who”), new consumer needs that no competitors are satisfying (a new “what”), and new ways of producing or delivering products and services (a new “how”). This work tends to be more episodic in nature and the competitive intelligence group should be focused on discontinuous innovations.

Analysis of Competing Hypotheses (ACH) process

When it comes time to gather the information and start the analysis there are number of techniques which are helpful. One of the best general-purpose methodologies for intelligence analysis is Richard Heuer’s Analysis of Competing Hypotheses (ACH). First developed by Heuer between 1978 and 1986 while he was an analyst at the Central intelligence Agency, his methodology draws on the scientific method, cognitive psychology, and decision analysis. The method became widely available for the first time when the CIA published Heuer’s now classic book The Psychology of Intelligence Analysis.

ACH methodology helps analysis overcome cognitive biases common to competitive intelligence. Using ACH forces analysts to set aside their preconceptions and look for inconsistencies in the data that may indicate a flaw in their reasoning. This method forces the analyst to disprove hypothesis rather let their minds jump to conclusions and permit biases and mindsets to determine the outcome before they properly evaluate the evidence.

Simple Example of ACH Matrix

The analysis of competing hypothesis is a very logical process consisting of eight fairly straightforward steps. A summary of the method follows and more complete details can be found in chapter 8 of Heuer’s book.
1. Hypothesis generation. This step requires divergent thinking to ensure all hypotheses are considered, and convergent thinking to ensure that redundant and irrational hypotheses are eliminated from the final set of hypotheses.
2. List evidence and arguments. Evidence should be interpreted broadly to include all factors (assumptions or logical deductions, goals, and standard procedures regarding the entity being assessed) that might have an impact on judgments about the hypothesis.
3. Create a matrix. Take the hypothesis from step one and the evidence from step two and put them into a matrix. This matrix has the question to be answered listed across the top and the hypotheses associated with that question listed in rows beneath it. Possible answers to the question (evidence that the hypothesis is correct) are listed as column headers. Within the matrix, one piece of evidence at a time, the decision is made whether the evidence is consistent with the hypothesis or not. Each cell is marked with a plus or minus depending upon whether consistency exists.
4. Refine the matrix. In this step, the hypothesis is reassessed in light of all the evidence. The hypothesis is reconsidered or reworded to reflect all the significant alternatives.
5. Tentative conclusions. Working down the columns of the matrix, each hypothesis is reviewed to draw tentative conclusions about the relative likelihood of each one.
6. Reevaluate weight of critical evidence. Re-examine key assumptions and pieces of evidence that seem to drive the analysis in a particular direction. Now that the analyst understands the logic of what counts and what doesn’t in the analysis, he or she should go back and examine each piece of it in detail for flaws. Does it make sense whole and in part? This step is key because when analysis turns out to be wrong, it is often because of key assumptions that went unchallenged and later proved invalid.
7. Report conclusions. One of the real strengths of ACH is that it makes the logic behind the analysis transparent to the decision-maker.
8. Milestones for future observation. Because events are dynamic and subject to a variety of influences, analytic conclusions are always tentative. Therefore specify in advance that certain occurrences, if observed, could cause significant changes in the probability of the accepted or alternative hypothesis. Collection of additional information can also suggest possibilities that may occur in the future.

ACH Assessing a Competitive Scenario process

Assessing a Competitive Scenario

When all tentative conclusions are taken together, an analyst creates a scenario. As mentioned above, in step six it is critical to double check for consistency and plausibility. In the “Assessing a Competitive Scenario” figure key steps and questions are listed for each element of the argument. The reasoning in any logic’s must be critically assessed. An indispensable means to test plausibility of any conclusion is to develop the strongest possible counterargument or counter conclusion. In summary, extensive learning about a competitor always takes place during the discussions and debates between authors and recipients of the CI studies.

ACH Competitive Analysis Techniques


Within a structured Analysis of Competing Hypothesis approach there are other useful techniques to create and test hypotheses. Because of the variety of industries which use competitive assessments the best techniques to use vary widely across them. Some primary technology analysis techniques many companies have found most useful are shown in the “Techniques” figure. This is a good checklist for any project to understand if the project team has considered all the typical best practice methods.

Sources of Information

As for the data and information itself, Chuck Klein argues that despite major efforts using secondary sources, in the end his teams often found the most valuable information came from human primary sources. Common primary sources shown in the “Sources of Information” figure include: former presidents and CEOs of major retail chains, sales representatives in the field of interest, retail chain buyers, trade magazine writers, stock analysts, competitors’ project manager, competitors’ investment relations department, former executives of key competitors, business editor of newspaper in towns where a major players are located, independent consultants who specialize in the industry being researched. Common secondary sources are: online databases, company homepages, trade magazines, SEC 10-K’s and other reports, other US government data, investor meeting summaries, packaged (purchased) research (Hoovers, Bloomberg, etc.), trade association publications, Internet databases and other sites, web forums and blogs, web retailers, analyst reports, company newsletters, USDOC statistics, court records, and government funding documents. These are segmented as shown in the “Sources of Information” figure. Oftentimes by conducting the secondary source research first allows using primary resources to be more productive as interview questions can be better formulated from gaps found in the secondary sources. In all cases when using primary resources the code of ethics must be upheld.

“Six Angles of Competition” Competitive Analysis Technique

Six Angles of Competition

As information is gathered for a competitive assessment, it is most helpful to structure it in a meaningful way. A good methodology to use is the Six Angles of Competition as shown in the figure. In this figure the various competitive angles include: (1) Direct competitors: solve the same buyer problems the same way your company does. (2) Alternative use competitors: solve different buyer problems the same way your company does. (3) Substitute competitors: solve the same problems in a different way than your company does. (4) Economic competitors: solve different problems for buyers in different ways to compete for the same budgets that your company does. (5) Complementary competitors: work together with your company to solve a problem but then compete for the larger share of the combined revenue. (6) Buyers: have a propensity and the ability to solve for themselves a problem they would otherwise pay your company to self. These six angles of competition facilitate the organization of the information that the competitive intelligence data collection uncovers.

Supporting Business Strategy with Competitive Intelligence War Rooms and Story-Boards

Competitive Intelligence storyboards are a means to summarize in one page (sometimes a large poster) all of the relevant information for a competitor, technology, or industry segment.

A Competitive Intelligence War room is an area set aside for use as an intelligence or knowledge center, as a demonstration room for reverse engineering purposes, or as a conference room for strategic planning meetings. Also referred to as an operations or situation room, it may contain a variety of intelligence or market-oriented displays; act as an internet/intranet/database/knowledge map center; be equipped as a library or a repository of information collections; allow easy and rapid access to recent research results. These rooms can be either virtual or physical. The advantage of the virtual room is it is more easily updated and access more easily controlled with today’s technology. The advantage of the physical room is it allows for large display areas that allow easy access to key planning and decision-making information.

War Room Layout

For physical war rooms suggestions include:
1. Access must be limited (physical – must have a security pass to enter room. Similar for virtual)
2. Members of the team with access to the war room generally include product managers, sales managers and one person from strategy plus the CI manager. Small teams with support from senior management are the best. They can work very quickly and effectively.
3. Competitors and one’s own products, marketing material etc. should be clearly displayed so that on entering the room (whether physical or virtual) we know why we are there! I have to say that a physical room has added benefits – touch, sight and taste is awfully powerful.
4. Multiple white and projection boards for brainstorming sessions. Personal productivity and bonding are enhanced when done in this environment.
5. Charts on the wall identifying the outcome of analysis relating to industry structure and each competitor. These are often referred to during brainstorming and planning sessions.
6. Charts of one’s own company’s planned activities i.e. new product introductions, specific campaigns, pricing etc. is clearly displayed with those anticipated by the competitors listed beneath.
7. Most War Rooms have operated effectively when you have duopoly or very few players in the industry. Once you have a fragmented market, war rooms far less successful as a competitive strategy process.
8. A common layout is a wall for Industry information (for example, Porter’s five forces information) for each line of business, a wall for Company information, and a wall for everything else. See the “War Room Layout” figure for one such room used for Corporate Strategic Business and Technology Planning. A square or round conference table is placed in the center of the room.
9. The war room may also be equipped with some means for communication, preferably videoconferencing, so that briefings and analytical sessions may be arranged without delay.

Physical War Rooms can be used in concert with the virtual world; and they are great for cross-functional corporate planning sessions for senior executives. Ideally, the planning team, with support from the line-of-business executives and the cross-functional teams from sales, marketing, finance, IT, etc., jointly build the competitive landscape. Then, in the final reviews of the corporate and line-of-business strategy sessions, the C-level executives would join in for the reviews and for scenario planning inside the room. The visual displays make sharing of background information and hypothesis testing quick and efficient.

One of the most essential items of the virtual room is a knowledge map (or contacts database), which must incorporate details of information sources and contact details. Some companies include directories and membership lists of related or useful organizations, a glossary of relevant terms and some means of controlling the vocabulary in whatever classification or indexing system is chosen. Collections of trade literature, competitor and market files, seminar and conference brochures, profiles of competitors and their senior people, and reverse engineering materials may profitably be included. Depending on the industry, some displays of up-to-date and critical information should be incorporated. The content is limited only be one’s imagination, but that content should be such that it be relevant and readily distributed.

Supporting Business Strategy with Competitive Intelligence Story-Boards

Example Storyboard

When it comes to concise display of competitor information, storyboards are an excellent choice. On the competitor wall of the competitive intelligence war room large storyboards are used to display each major competitor’s information. The “Example Storyboard” figure shows how the elements are laid out. The deliverable for the storyboard is to provide a summarization of competitive assessment data. It’s elements should include the competitors basic profile, financials, philosophy, timelines, executive team, international presence on a map, key acquisitions and their impact on existing product and service offerings, key market segment profiles, business unit’s organizational diagrams, and recent news. Key business information to be included is the founding date, headquarter size and location, other locations, and structure. Financial information should include net sales and profit margins. The corporate philosophy should be present and the entities’ visions and objectives shown. Any M&A history should also be part of the display.

Communicating Competitive Intelligence Findings

Relative Differences in Content Between the Layers

A follow on to the displays in War Rooms, is the communication of specific relevant information to key roles in the organization. The “Relative Differences in Content Between the Layers” figure shows how the information is best displayed in the War Room for Senior Management, Strategy and Planning personnel, followed by different displays of the same and more detailed information to Business Unit heads, marketing, sales, and technical personnel.

Competitive Intelligence Role in Business Appraisals

Role of CI in Business Appraisals

In the paper “CI Business Evaluation”, Margaret Horne discusses the typical steps followed in performing business appraisals, along with the role that CI plays in each. These steps and the corresponding CI action are shown in the “Role of CI in Business Appraisals” figure.

Carrying out these steps requires the use of specific research tools in the hands of trained professionals and support personnel. The most advanced toolsets change over years as Internet and database search tools and analytics improve. The following sections however provide examples of what can be achieved. Probably one of the most important items is to ensure that a small group of people participate in any study. The group should have the diversity to both conduct research as well as audit the results obtained for sanity.

High-value opportunities for competitive intelligence support occurs during M&A planning and due diligence processes, R&D and business development portfolio planning, and during the R&D and business development projects themselves. In the latter case competitive intelligence should be involved in each of the different Stages / Gates or Agile / Lean sprints.

Competitive Intelligence Assessments for Mergers and Acquisitions

Extended SWOT Analysis

For M&A analysis, Paul Dishman advocates using an extended SWOT analysis which tailors the analysis to specific examination topics. Typical analysis topics in his extended SWOT analysis consist of: (1) market share gain, (2) market entry, (3) intellectual property, (4) financials, (5) management team,(6) owners and founders, (7) products and services, (8) manufacturing, and (9) strategic fit. Utilizing an extended SWOT analysis can take the company to a higher level of insight, revealing a clear picture of potential strategic fit and higher-quality decisions.

The “Extended SWOT Analysis” figure provides an example of what would be filled in for a hypothetical acquisition opportunity. It’s provided here as a framework.

Competitive Intelligence Assessments Using a Strategic Gap Analysis Table

Summary Strategic Gap Analysis Table

For executive teams the extended SWOT analysis example can work well for backup but an even shorter form needs to be used to set the stage during presentations. The “Summary Strategic Gap Analysis Table” figure shows how the analysis can be collapsed in a way that shows both weaknesses and benefits. This graphic works well is a summary report card.

To show the strengths and weaknesses of intellectual property portfolios that will be involved in M&A transactions a different approach to presenting the information utilizes radar/star/spider diagrams. To create these databases of all relevant art in a field are aggregated, and then the individual portfolios of the entities being proposed for acquisition are compared. To do this 22 measures of portfolio performance are calculated and compared. The 22 measures are segmented into three general areas related to (1) legal strength – prosecution/maintenance/litigation, (2) citation strength – by other entities citing the portfolios patents, and (3) geographic strength – in the major Tier 1 and BRIC countries.

Example Patent Portfolio Metrics of Acquisition Targets

Example Patent Portfolio Metrics of Acquisition Target A

In constructing the comparative radar diagrams 22 measures of portfolio performance are calculated in the three areas of legal, citation, and geographic strengths. In the “Example Patent Portfolio Metrics of Acquisition Target A” figure, the metrics associated with prosecution / maintenance / litigation are shown the upper left quadrant along the red arc. Those metrics associated with citations are shown along the bottom blue arc, and those with geographic strength are shown in the upper right quadrant along the green arc.

“Outstanding” in this evaluation method is defined as being two standard deviation units above the average for the particular metric being graphed. “Above average” in this evaluation metric is shown as the light yellow area on the graphic display and is defined as being above average but below two standard deviation units above the average. “Below average” is shown as the orange tinted area of the graphic. The rating of a particular portfolio is displayed as dots along the red line for each axis or arm of the spider diagram.

This example Acquisition Target A’s portfolio has no “outstanding” performance in any one area. The company had over six above average performance areas, making it a B+ portfolio (benefiting from how new and small the portfolio is). Of importance, it had intellectual property sharks following their work and scored high on ”IPC dispersity” and “claim length”. The portfolio has weak international coverage. In conclusion it is a defensive portfolio designed to support product offerings versus supporting licensing out programs. These attributes make it a possible partner for acquisition as this portfolio and strategy matches that of the acquiring company.

Example Patent Portfolio Metrics of Acquisition Target B

Another acquisition target’s portfolio is shown in the “Acquisition Target B” figure. This company’s portfolio had five “outstanding” performance areas. These were related to having the largest portfolio in the field, and all of its art is applications (new) versus patents. This company also had six above average performance areas. This pattern of results also made it a B+ portfolio, benefiting from breadth of disclosures from an examiner’s IPC standpoint. It has strong US but weak international coverage. The competitive intelligence conclusions derived from studying such a spider diagram concludes that this company also has a defensive portfolio designed to support product offerings versus supporting license-out programs. It too is another possible partner for the acquiring company.

From a due diligence standpoint both portfolios have overall strengths and weaknesses comparable to one another. Which one is better will depend upon the strengths and weaknesses of the other non-intellectual property aspects of the acquisition deal.

How to Use IP in the M&A Process

How to Use IP in the M&A Process

In addition to intellectual property being one of the due diligence items reviewed during the M&A process, intellectual property information can also be used to find, analyze, and negotiate agreements. The ” How to Use IP in the M&A Process” figure shows at a high level the M&A process steps, the information that’s generated during each of those steps, and finally the intellectual property tools that can be brought to bear to help make a fast, high-quality, and sticky decision.

During the identifying targets phase of the M&A process the objective is to create a list of high-quality candidates. This can be done using intellectual property by taking the patents from all companies in the business segment of interest, and from that combined list of patents, create a high level landscape map of all companies’ art. Each company’s art is color-coded including those patents of the acquiring company. Candidate companies can be added to the list based on which of the industry participants occupy landscape map positions similar to the acquiring company, as well as those that occupy business areas on the landscape map of interest to the acquiring company.

A similar analysis can be done by creating radar graphs where each axis represents a patent classification. The short list of companies’ patent holdings can be mapped on this chart to show the degree of overlap and distinction in various candidate company’s business and technical competencies.

Once a candidate list of companies has been obtained the next step in the M&A process is to evaluate and analyze the top candidates. Utilizing patent databases can again be helpful. Using the tools shown in the above section, comparing patent portfolios is most helpful in assessing the target companies technical and business strengths and weaknesses.

Typical Factors Impacting M&A Value

Patent analysis can also provide information on management style. Utilizing patent citation trees, each of the target company’s propensities to invest in work to create a sustained advantaged position can be seen. Those companies with patent fences are much more likely to achieve high-performance, high price solutions in the marketplace over longer periods of time. More detailed landscape maps are also helpful at this stage. They are constructed just of the art from the parent and target companies involved to show a close up view where areas of synergy and differentiation exists. Plotting each target candidates’ patent publication record over time also shows whether they have been sustaining investment in new products and services. Corporate financial records and SEC information on R&D can be used to see a change in investment in R&D. However, weakness in new business investment can be hidden by diverting R&D resources into tech service and customer support efforts, hiding the fact that the company is in fact reducing their commitment to the future. Using patent pattern helps uncover such “prepare for sale antics” in companies wishing to be acquired. When this is found, caution should be exercised in purchasing the target.

Typical Factors Impacting M&A Value

During the due diligence phase of the M&A process, patent databases can be used to identify by name significant inventors of the company. These inventors may be crucial to the merger and their ability to continue to innovate and/or pass on know-how is a crucial negotiation factor. Likewise if a company has a strong patent committee those resources have deep knowledge of the company’s technical, business, and market insights, its members are critical to retain after consummation of the merger or acquisition deal.

The checklist of items for competitive intelligence to assess during M&A evaluations is shown in the “Typical Factors Impacting M&A Value” figure.

Competitive Intelligence Assessments for Technical Strategic Planning and Project Management Reviews

Elements of Competitive Intelligence Used in Technology Strategic Planning

In Chapter 7 various methodologies for strategic technology planning were discussed. Common among all of them was the importance of obtaining early warning of new developments, capabilities, and strategies of competitors and potential competitors to support wise decision-making. The planning team needs to know things in advance of them happening and wants to use that knowledge in decision-making to gain advantage. To do so they must look at the whole world of business intelligence as depicted in the “elements of competitive intelligence used in technology strategic planning” figure. The broader realm includes such factors as environmental, societal, and political trends. Commercial intelligence is just what it sounds like, focusing on competitors, customers, markets, and suppliers. Coupled with this is technology intelligence with emphasis on scientific breakthroughs and technology trends. These two must be anticipated and responded to with new technology and science developments from your own company.

Competitive Intelligence in Support of Intellectual Asset Management Processes

Intellectual Asset Management Process

There are many good references on how to conduct good technology and commercial intelligence. The secret is not so much in ways to get information, but rather in asking the right questions and making sure the answers create a self-consistent viewpoint. For Technology Planning the iterative process is shown in the “Intellectual Asset Management Process” figure. Note that this process starts with business strategy and ends with the products or services available for monetization. The key role of competitive assessments is shown along with the high-level questions competitive assessments must answer to promote high-quality sourcing and asset decisions.

Competitive Intelligence in Support of Intellectual Asset Management Processes

Intelligence Focus Changes During Development Process

For projects that are moving down the stage / gate or agile / lean innovation processes, competitive intelligence takes on a more focused approach. In the “Intelligence Focus Changes During Development Process” figure, this change in focus moves from early broad technology scanning and trends with potential competitors into more focused monitoring of technology progress in actual/potential competitors activities as a project moves along. As projects go commercial the competitive assessments switch to market and industry trend following. The specific task for competitive intelligence teams during each stage of the development process is typically outlined in detailed Gate questions that the competitive assessment project team must answer for each project at each gate review. Examples of these detailed questions are provided in chapter 12 of this Compendium. Most important, competitive intelligence’s role during the gate reviews has to be based on their providing fact-based assessments and an external view of the world, not tainted by project ownership. Competitive intelligence must be the counterforce for internal development. Its role is to provide checks and balances to the internal process. As such, it must investigate strategic partnerships, have the ability to investigate licensing technologies to others, licensing technology in from others, and consider mergers acquisitions or disposition of businesses.

Competitive Intelligence Assessments Done During Technical and New Business Development Projects

During technical and new business development projects, the assessments conducted at the close of each development Stage or Sprint are designed to reduce project risk. In this case, risk can be thought of as the likelihood and impact of an outcome less favorable than the most likely project scenario. Some of the project risk can be ascertained and analyzed by information obtained from internal project team members. However much of the project risk analysis involves competitive, supplier, and consumer information that must be obtained from outside sources. Thus competitive intelligence professionals are key to obtaining timely and accurate information for project reviews and Boards.

The project risk analysis should include: (1) R&D Risks – The technology may be too difficult or too costly to commercialize. (2) Manufacturability Risks – Significant additional development may be required to mass-produce the product. (3) Marketing Risks – What the customer will do with respect to a specific product offer-for-sale opportunity. (4) Competitive Risks – What will be the most likely competitive response. (5) Legal Risks – How the cost and utility of the technology are affected by legal issues (FTO, license royalty payments, legal fees, etc. Specifically is there blocking prior business, technical, or patent art? Are there white space opportunities to leverage? Is there internal adjacent art at the company or from licensing from outside the company?)

Competitive Intelligence Expands Project Goals and Outcomes

Project Goals

Most project goals are to quickly develop high-value products and services for the Corporation’s internal use, and to license out where appropriate an expanding net of related intellectual property. This is shown in the “Project Goals” figure. The role of competitive assessment is to spark, expand and audit all ideas to create maximum value via internal company complementary assets as well as value from licensing-out the spillover products and services that can be proactively envisioned and protected. To ensure that this happens competitive assessments should:
1. Should Be Part Of All Gate Reviews. Be (a) Fact-Based Assessment, and (b) Add an External Viewpoint
2. Be the Counter-Force for Internal Development. (a) Provide Checks and Balances, (b) Investigate Strategic Partnerships, (c) License Technology to Others, (d) License In From Others, and (e) Sell As a New Business Entity

Assessing these risks requires answers to typical questions raised the project reviews. These include:
● Show an Overall View of Related Art, Uses, and competitors?
● Who are the top companies doing related work?
● Who are the top inventors doing related work?
● Which technologies can produce similar feature sets?
● How fast is the product technology changing?
● Which other companies have recently applied for patents?
● Which companies can block or circumvent other’s patents?
● What related technology and markets might be under exploration?
● How long does it typically take competitors to prosecute their patents?

Descriptions of Stage-Gate and Agile Commercialization Stages

Technology Commercialization Stages

The answers to these questions vary as a project proceeds along the Stage/Gate or Agile/Lean Sprint process. For the Stage/Gate process, the “Technology Commercialization Stages” figure shows what is expected at the end of each stage. Thus question answers evolve in sophistication and detail as the project proceeds to commercialization. At the end of each review however the Governing or Management Team must have a good feel for (1) How Active an Area of Research Surrounds the R&D Project? (2) How Do the Project’s Innovations Distinguish Themselves From Known Prior Art? (3) What Are the Preliminary Strengths, Weaknesses, Opportunities and Threats Posed by Alternative Technical and Business Approaches?

Map of Competitive Assessment Tools Used During Development

Competitive Assessment Tools and Viewpoints

A way to map out the various Competitive Assessment Tools and Viewpoints needed at each Stage of an R&D project is shown in the “Competitive Assessment Tools and Viewpoints” figure. What follows is a Stage by Stage review of each of these 55 tools, starting with Tools for Investigating an Idea. In this Idea stage there exist different models of how invention and innovation takes place and whether the processes can be systematically understood and improved. There are also many methodologies available from consultants which can greatly speed up and improve the quality of ideas available. Competitive assessment tools can be used in conjunction with these methodologies, and used as a support tool for independent inventors.

An Industrial Research Institute “Survey of High Performance Inventors and innovators” found that the Top Problem was it took “Too long to Invent”, and the Top Opportunity was being able to be “Asking the Right Questions”

Competitive Assessment Tools and Viewpoints for the Idea stage

The following nine Competitive Assessment Tools and Viewpoints for the Idea stage (Tools 1-9) are designed to shorten the time to expand an idea. They allow the inventor to ask/answer the right expansive questions and prepare the idea for consideration as a formal project / program.

Tool #1 Map of Similar Ideas, Art & Markets
Tool #2 Table of Assignees
Tool #3 Table of Inventors
Tool #4 Chart of Similar Technologies
Tool #5 Patent Activity Chart
Tool #6 Chart Narrowing Areas to Explore
Tool #7 Tree Showing Idea’s Environment
Tool #8 Root-tree Showing Idea’s Environment
Tool #9 Document Thoughts and Analysis

Competitive Assessment Tools and Viewpoints for the Preliminary Assessment Stage

The following eleven Competitive Assessment Tools and Viewpoints for this Preliminary Assessment stage (Tools 10-20) are designed to explore new ideas and concepts and set in motion as many promising “seed” projects as possible. The cost of research and investigation is small here. A single worker may have a project or even work on several simultaneously. There are typically many avenues being explored and no valid idea or concept is neglected. The main consideration is whether the idea or concept is strategically appropriate, and whether the expertise available to address the concept or idea is adequate and part of the company’s core competencies. The output of this stage is the validation of concepts, physical principles and market features. Metrics for this process address the validity of results and whether or not basic principles are established. Competitive Assessment Tools and Viewpoints for this stage are designed to help a project leader and team quickly assess many possible approaches to the product or service. The tools also help the leader/team incorporate data from corporate databases and competitive analysis to speed the assessment process.

Tool #10 Map of Similar Technology and Uses
Tool #11 Table of Inventors by Assignee
Tool #12 Proposed Product Feature Groups
Tool #13 Chart of Similar Technologies
Tool #14 Chart of related markets
Tool #15 Recent Patent Activity Chart
Tool #16 Recent Patent Application Chart
Tool #17 Chart of Other Company’s Work Related to the Project Goal
Tool #18 Citation Tree Showing Concept’s History
Tool #19 Root-tree Of Concept’s Environment
Tool #20 Notes for Documenting Analysis

Competitive Assessment Tools and Viewpoints for the Feasibility Stage

The following twelve Competitive Assessment Tools and Viewpoints for the Feasibility stage (Tools 21-32) are designed to test whether a concept can be validated in the lab and with some lead customers. The emphasis is on proof-of-principle in real business applications. Business considerations such as market window and competitive reaction begin to be important, although there will still be exploration of options and possible spin-offs of the technology or concept. The “filtration” function at this gate is fairly strong, since although the cost of research in the Feasibility stage is still not great, there will be many more candidate ideas than there are resources to explore them. Competitive Assessment Tools and Viewpoints for this stage are designed to help a project leader and team wisely narrow the technologies and markets under consideration. The tools also help the leader/team identify partners that can speed the feasibility process.

Tool #21 Refined Map of Technology and Uses
Tool #22 Table of Inventors by Assignee
Tool #23 Map of Which Proposed Product Features Are Feasible
Tool #24 Chart of Similar Technologies
Tool #25 Chart of Related Markets
Tool #26 Recent Patent Activity Chart
Tool #27 Recent Patent Application Chart
Tool #28 Chart Narrowing Areas to Explore
Tool #29 Citation Tree Showing Project’s Prior Art
Tool #30 Root-tree Showing Competitive Environment
Tool #31 Cycle Time for Patent Prosecution
Tool #32 Notes for Documenting Findings

Competitive Assessment Tools and Viewpoints for the Development Stage

Development projects are the few projects that are highly promising for commercialization and meet all the requirements for profitable business products. The following eleven Competitive Assessment Tools and Viewpoints for this Development stage (Tools 33-43) are designed to test if candidate technologies in this stage have forecast long-term corporate benefits, and meet all the strategic requirements of fit, alignment, and attractiveness for the business. Emphasis shifts in the Development stage to harder-edge issues, such as timing and execution to assure that market windows are met and product needs are satisfied. There is also emphasis on maintaining and extending technologies to keep a competitive edge in the marketplace. Milestones are important due to cycle time issues. Project funding must be managed more carefully due to budgets which are typically millions of dollars, rather than the 100 times lower investment that may be typical of Feasibility and Preliminary Assessment stages. Competitive Assessment Tools and Viewpoints shift in this stage from tools to expand and build an idea to include tools that support seeking and building Intellectual property protection around the project.

Tool #33 Competitive Technology and Use Map
Tool #34 Map of Achievable Product and Service Features
Tool #35 Map of similar technologies
Tool #36 Chart of related markets
Tool #37 Recent Patent Activity Chart
Tool #38 Recent Patent Application Chart
Tool #39 Chart Showing Areas to Lock-Up or Lock-Out
Tool #40 Citation Tree Showing Project’s IP Position
Tool #41 Citation Root-tree Showing Project’s IP Position
Tool #42 Cycle Time for Patent Prosecution
Tool #43 Notes to Support U.S. Patent Application Preparation

Competitive Assessment Tools and Viewpoints for the Scale-Up Stage

Scale-up is the last stage prior to full product launch. The following seven Competitive Assessment Tools and Viewpoints used for the Scale-Up stage (Tools 44-50) are focused on obtaining protective IP rights for the commercial product and any easy follow-on approaches competitors might try. Competitive Assessment Tools and Viewpoints tools help visualize how much protection is necessary.

Concerns for entering full commercialization are about whether all major manufacturing and distribution hurdles are cleared, and whether commercialization costs allow for profitable entry into the marketplace. Some strategic questions must still be addressed, including market need and timing. Metrics here address both the strategic and tactical issues.

Scale-up is obviously market and manufacturing oriented. Careful management of commercialization and product costs, timing, and execution are the key issues. Since budgets up to tens to hundreds of millions of dollars may be at stake, program and resource management are paramount.

Tool #44 A chart of similar technologies
Tool #45 Recent Patent Activity Chart
Tool #46 Recent Patent Application Chart
Tool #47 Chart Narrowing Areas to Explore
Tool #48 Citation Root-tree To Time Project’s IP Filings
Tool #49 Cycle Time for Patent Prosecution
Tool #50 Documentation To Support U.S. Application and Foreign Filings

Competitive Assessment Tools and Viewpoints for Evaluating a Portfolio of Projects

Associated with individual projects are Competitive Assessment Tools and Viewpoints used for evaluating the health of a platform or portfolio of projects. The book “Third Generation R&D” contains a variety of visual tools for selecting and improving an R&D Portfolio

The Industrial Research Institute’s Research on Research Sub-committee’s improved on the R&D Portfolio selection process. Their results and other best practices can be found in Chapter 7, Technology Strategic Planning, of this Compendium.

Competitive Assessment Tools and Viewpoints also support the Portfolio selection process by providing Tools and Viewpoints that show the company’s overall capabilities and direction, and patent portfolio strengths and weaknesses. These are shown as Tools #51 through Tool #55.

Tool #51 Map of Company Competency & New Projects
Tool #52 Proposed Features Map In The Context of All Possibilities
Tool #53 Map of Company Patent Activity
Tool #54 Cycle Time for Patent Prosecution
Tool #55 Document Meeting Thoughts and Analysis

Example Competitive Intelligence Assessment of a New Business Development Project

In order to provide a better understanding of the tools and viewpoints mentioned in the previous section, an example of a competitive assessment for a new business development initiative is provided. This example project, utilizing high ethylene content vinyl acetate copolymer emulsions, will use 14 selected patents as representative of the initial art to be considered.

The objective of this competitive assessment is to (1) conduct a preliminary overview of the field, (2) assess the proposed project against known prior art, (3) perform a preliminary strengths, weaknesses, opportunities and threats (SWOT) analysis, and (4) identify white space opportunities for business units in licensing.

To frame what is about to be discussed below, the following key questions were put before the competitive intelligence team.
1. Is there an opportunity to practice the invention?
2. Can the patented invention be asserted against potential infringement and defended?
3. Can the patent be easily circumvented by minor changes in reduction to practice?
4. Are there competitors, what IP exists, and is it dominated by one or more firms?
5. Does it appear possible to enhance the IP strength prior to commercialization through additional patents?
6. Are there white space opportunities?

Starting Point of a Competitive Intelligence Assessment of a New Business Development Project

To get started, the field of interest has to be framed. Keywords and concepts need to be identified. These come from product specifications or service line descriptions. To obtain them the team reviews product or service line websites and other industry information to capture the more descriptive terms. Another source of information comes from product packaging. This can be obtained by buying or examining a sample of products. The team records words used on packaging to describe the product. The third source is to look at existing patent or intellectual asset portfolios. Key business or scientific terms can be captured to further describe the product, service, or invention. The terms, especially product-function terms, that do not appear in either of the above-mentioned searches are often found in intellectual property information sources. These too should be added to the list.

Starting Point of the Analysis

For this example analysis there are 14 issued US patents related to the technology of interest at the time the analysis was done. They are shown in the “Starting Point of the Analysis” figure. From this figure it can be seen that all are US patents and one is from Air Products, which for the purposes of this example will be considered to be the company running this example (sometimes labeled as “Client” in the graphics and text). There are a mix of inventors and most importantly five product features are mentioned in the titles. What can be concluded from this list is that it is likely a rich source of information on which to get started. The next questions for the analysis team to consider are: Is the art well-known by others? What patents are associated with such other entities? What other work have these inventors done? What products or product functions have been identified?

Competitive Intelligence Assessment of a New Business Development Project: “Is the Art Well Known?”

Is the Art Well Known?

Starting with the first question regarding “is the art well-known?”, the list of 14 patents were evaluated for the number of times they’d been cited by others as shown in the figure. It’s found that two of the patents have drawn the most interest. But although they’ve drawn the most interest, the citation counts and more importantly the average number of citations per year are low numbers when compared to benchmarks for high-value inventions in this technology area. Thus the analysis team can conclude that this field isn’t active when compared to other fields, and perhaps important for this company is their own R&D work is not well known, as it was not cited by any other entities. This slide raises three other considerations for the analysis team. Do they need to expand the search? Does their company not possess key art in this field at all? Would a citation root tree approach be a viable way to uncover such art?

Competitive Intelligence Assessment of a New Business Development Project: “How Extensively Has the Top Cited Patent Been Built Upon?”

How extensively has the top cited patent been built upon?

Top cited patent, US 5782181 references 27 US patents and is cited by seven other entities, as shown in the “How extensively has the top cited patent been built upon?” figure . The patent was issued in 1998 and just four years later in 2002, the time of this example study, there are ready two tiers of further investment. Three companies are working hard in this field. What the analysis team can conclude is that the assignees in this field are relatively concentrated and committed. This raises the question for the project team as to whether or not they can get support from their own management to enter this high investment area.

Competitive Intelligence Assessment of a New Business Development Project: “How Extensively Has the Second Most Top Cited Patent Been Built Upon?”

Second top cited patent

To gain further insight on entities participating in the field, the second patent that is been cited most by others was studied for its relationships as shown in the “second top cited patent” figure. The team noted that this patent has been cited heavily by others, in part because it is key to the field and also in part because it is quite old, having been issued in 1978. The patent itself references nine other patents which is a reasonable number for a new chemical entity. The team concludes that over the years this has been an active area of business development. From their participation in the citation map KCC and Sumitomo are certainly potential competitors or partners for the investigating company. This large amount of art also raises potential prior art bars. The question this graphic raised for the project team was “in the tree branches that are not populated by their own company, what are the opportunities?”

Competitive Intelligence Assessment of a New Business Development Project: “Are the Company’s Own Patents Being Cited?”

Company’s own patent

The Company’s own patent was studied as shown in the figure. Although it can be seen that it heavily built on the work of others, most notably National Starch, it has not received any forward citations itself. In part this could be because it is so new. It is also possible that the art contains narrow claims. Considering this and the other two top cited-by patents, the analysis team considers that root-tree searching might uncover other meaningful art. This would help better determine if there’s freedom for the new business development team to work in this area. There’s definitely the possibility of potential infringement which would require a detailed claims analysis.

Competitive Intelligence Assessment of a New Business Development Project: “What Business Are the Top Assignee’s Interested In?”

Rank Ordering of Assignees

Moving from the team’s focused start looking at just 14 patents, they used the work they did on keyword development to create a database of over 17,000 patents that were related generally to ethylene vinyl acetate copolymer emulsion technology. From such a large body of work the analysis team segmented the documents by assignee. In the “Rank Ordering of Assignees” figure it can be seen that investors in this technology included those utilizing materials and applications, competitive suppliers of similar materials, and raw material suppliers. There were significant portfolios from many companies. The team concluded that freedom to practice will be clouded by lots of prior art, and that they will have to use other analysis tools to quickly figure out if this project is worth doing.

Competitive Intelligence Assessment of a New Business Development Project: “What New Application Areas Should Be Considered?”

New Application Areas for Consideration
More Application Areas

To refine the areas of interest that might be important for their own company, the analysis team created a list of the “topics” found in the 17,000 patent database, and identified those related to application areas the company might want to participate in. As seen in the “New Application Areas for Consideration” figure the green highlighted topics represent application areas already being addressed by ethylene vinyl acetate copolymers. The team was happy to see that many areas were available for consideration for new products. They also understood that freedom to practice studies would be required for any areas their management team might want to pursue. On the plus side partnerships and mergers may be available to speed the new business development process along. The list was further refined as shown in the “More Application Areas” figure.

Competitive Intelligence Assessment of a New Business Development Project: “How Crowded Are Application Areas (Landscape Maps)?”

Utilizing Landscape Maps

Another way to find application areas that might be of interest is to build landscape maps from the group of 17,000 patents in the database. These landscape maps show areas where past investments have been made. In the “Utilizing Landscape Maps” figure, mountains show where large investments have been made. In this case investment was in the areas of monomer coatings, particle coatings, package materials, coating substrates, reinforced fibers, pressure sensitive adhesives, inkjet, transfer sheets, and photographic materials. There is also significant whitespace or blue ocean areas available.

The project related art as identified by keywords and concepts contained in the 14 initial patents yielded 256 patents related to the subfield of most interest to the project team. The art selected is shown as white dots on the landscape map. The company’s own patent is shown as a red dot. Looking at the area of concentration and can be seen the pressure sensitive adhesives are an area to explore in further detail. This is the business segment where most of the art related to ethylene vinyl acetate copolymers have been used. Looking first at this area current interest the project team now wishes to look more closely at who’s been working in this subfield? Which potential competitors if any dominate the subfield? How active is a subfield been over the last 10 years? And who holds key patents in the subfield?

Competitive Intelligence Assessment of a New Business Development Project: “How Crowded Are Application Areas (Patent Codes)?”

Patent Classification of Art In Sub-Field of Interest

As shown in the “Patent Classification of Art In Sub-Field of Interest” figure, it can be seen that the top three areas relate to adhesive compositions (C09J), applications of these adhesives (A61F), and product constructions using these adhesives (B32B). In particular the detailed uses found in this patent classification relate to: filters implantable into blood vessels, prostheses, orthopedic, nursing and contraceptive devices, fomentation, treatment of eyes and ears, bandages, dressing and absorbent pads, and first aid kits. The product constructions use consist of layered products built of either flat or non-flat cellular or honey comb forms. Some of these market opportunities were new to the project team and recorded for follow-up in business databases. Before proceeding however the team wanted to find out if this was an area of active investment or not.

Competitive Intelligence Assessment of a New Business Development Project: “What Are the Size and Velocity of the R&D Investments in this Area?”

Investment Velocity in Sub-Field of Interest

This can be seen in the “Investment Velocity in Sub-Field of Interest” figure, investment has been going through five-year waves. Such waves of patent activity typically indicate new technology and market introductions. This is good news for the project team because markets that are in steep decline are typically not of business interest, and those that are explosively growing often require a merger or acquisition to participate, which is sometimes more than the overseeing management team can stomach.

Competitive Intelligence Assessment of a New Business Development Project: “Who Are the Closest Commercial and Technical Participants in this Area?”

Participants in Sub-Field of Interest

Understanding who are the top players and their interest in a specific area is clearly important to the project team when recommending if their company should participate or not. There’s no reason to pick an area of strong intense competition if other open areas exist that would be more easy for a new entrant to dominate. In the “Participants in Sub-Field of Interest” figure the top investors are competitors with specific business interests. These are 3M and Avery. These top companies typically use the technology internally. This was not a business problem for the team per se, but these top companies’ heavy investment, and track record of investing in intellectual property indicate that potential prior art clouds may be present. That said, licenses might be available from them for business use outside of their specific business focus. There are also complementary partners available. These could be of help once the project team selects a specific application it wants to pursue.

Competitive Intelligence Assessment of a New Business Development Project: “How are Investments of the Closest Commercial and Technical Participants Changing?”

Changing Investments in Sub-Field of Interest

It is not only the top participants who are of importance, but also those who are most changing their investment. The “Changing Investments” figure shows that companies are simultaneously building their efforts, and leaving, the field. The project team noted that the largest investors in the field are actually holding their investment in new technology and business developments flat. There are also some large companies withdrawing from the field which means that there will be qualified technical and business personnel available for hire if the project proceeds.

Competitive Intelligence Assessment of a New Business Development Project: “What Are the Investment Overlaps of the Closest Commercial and Technical Participants?”

Top Participants Technology / Use Focus in Sub-Field of Interest

By viewing the patent art by patent class and competitor two observations can be made. First, those competitors that have similar investment patterns are in close competition with one another, these competitors and those areas should be avoided by the project team. Second, looking at single participants, one can see from the pattern which material and processes are used in which applications. This gives the project team hints for alternative technical approaches and alternative business uses.

Competitive Intelligence Assessment of a New Business Development Project: “Who are the Small Players in the Field of Interest?”

Small Players in Sub-Field of Interest

In order not to leave any opportunities out, the project team also reviewed those assignees with only one or two patents. These documents were selected and since there were only 50 of them they were quickly hand-screened by the project team. This was done because often single patent holders have good ideas but lack the resources to fully utilize a new technology or enter a new market area. Where others have failed in the past represents new opportunities for the present.

Competitive Intelligence Assessment of a New Business Development Project: “Who are the Top and Extraordinary Inventors in the Field of Interest?”

Top Inventors in Sub-Field of Interest
Extraordinary Inventors in Sub-Field of Interest

As a final check the project team focused on individuals who are working in the subfield of interest. There are three ways to do this the first as shown in the “Top Inventors” figure. What can be seen in this analysis is that no one vendor dominates the area. The conclusion the project team came to was that the work was done over an extended period of time by lots of small teams. Another way to look at who dominates the field is to look at who’s been cited most by others. Such individuals are often considered as thought leaders in a technical or business area, and their project work should be tracked closely by competitive intelligence professionals. In this case the “Extraordinary Inventors” figure shows that the top four were from a single company, 3M. These individuals were further researched by the project team using scientific conference and journal literature.

The final use of inventor information is to look for which inventors have patents that are assigned to different corporate assignees. When such is the case this information can reveal hidden partnerships, especially in Japan. It can also give an idea as to whether a person might be obligated by confidentiality or contract restrictions. This is particularly important if a project team identifies an individual they would like to hire for their own new project.

Competitive Intelligence Assessment of a New Business Development Project: “Who are the Universities in the Field of Interest?”

In addition to looking at inventors, the project team also looked at universities and other academic institutes to see if there was new technology being developed. This is done by searching the 17,000 patents in the database for assignees with university, college, regents, alumni, institute, her Majesty and other terms associated with academic institutes In the assignee name. In this case there were none. If there had been such entities, those with the highest number of patents, and those with the highest cited-by counts would have been added to the investigation list.

Competitive Intelligence Assessment of a New Business Development Project: “What are the Blue Ocean Opportunities?”

Blue Ocean Opportunities

The final step in this competitive assessment process is to get ideas for new ventures. Preferably these are associated with the company’s current core competencies. One way to do this is to look at the landscape maps. Art located in the blue oceans is “not like the other art” by definition because of the way the map is made. As seen in the “Blue Ocean Opportunities” figure the art contained in the landmasses can be subtracted from the total amount of art in the dataset to reveal the Blue Ocean art. This Blue Ocean dataset can be segmented for art published in the last five years. The segmentation is done because of the art is old and still standing by itself it is not likely to be of commercial value. If the quantity of recent art is small the team can evaluate the patents quickly by hand. If the dataset is larger, it can be further screened by looking at art which is highly cited by others. In this example case, art was found that led the project team to consider several new applications. These opportunities included insulating materials, thermal dye transfer, photographic elements, and color diffusion as shown in the “Blue Ocean Documents” figure.

Blue Ocean Documents

Competitive Intelligence Assessment of a New Business Development Project: “What is the Final Recommendation?”

Taking all this information forward to the management team, the project team recommended starting a project in the high ethylene content vinyl acetate copolymer emulsion area. Their logic for doing so was:
1. There is a likely opportunity to build and practice art related to the starting invention the company made.
2. It would be likely that the existing patented invention and newly developed art could be asserted against potential infringement.
3. It appears possible to enhance the IP strength prior to commercialization through additional patents
4. There are white space opportunities to explore in addition to the already existing major markets.
5. During the project development process the identified competitors can be tracked for any changes in their level and direction of activities.

Assessing Competitors’ and Partners’ Strengths, Weaknesses, Opportunities and Threats with IP Competitive Intelligence

When developing strategic plans it is important to know your competitor strengths and weaknesses. Likewise when developing business partners the same needs exist. The long-term viability of a business is strongly dependent upon knowing your competitor strengths and weaknesses, identifying opportunities and threats these competitors present, and uncovering unknown competitors.

When developing this information resource it is important that the information found be presented in a format that moves a management team toward action. Otherwise it just becomes a book or a folder sitting on the shelf. Following is a generic assessment which provides a representative snapshot of a few competitors.

The analysis starts by conducting a preliminary overview of your own company, competitor, and potential partners’ art in a specific technology business area. This can be done on patent databases using keywords, business or technology classifications, product-function criteria, or known assignee patent portfolios. Comparisons are then made between your own company’s portfolio vis-a-vis known competitors against a background of all other patent art in the relevant area.

The key questions such analyses answer are: (1) how broadly has a given competitor/potential partner filed patents? (2) What is the likely strength and dominance of competitors’ art? (3) What is the likely breadth of competitors’ portfolios outside their existing business use? (4) How likely is it that each competitor can sustain its current innovative pace? (5) How quickly is the field moving? (6) What is the approximate investment over the last ten years? (7) Is there a good partner available?

Evaluation of a Company’s Patent Portfolio

Example Evaluation of a Company’s Patent Portfolio

When profiling an IP portfolio from a business perspective, there are six main areas to consider. These are: (1) Overall Size and Scope, (2) Validity and Value, (3) Licensing Size, Depth and Breadth, (4) Sustainability, (5) Velocity, and (6) Direction. For the first four areas a star/spider chart is made using over two dozen metrics. The percentile score of each company on each axis can be calculated. In so doing the “picture” created shows areas of relative competitive strength and weakness. An example is shown in the “Example Evaluation of a Company’s Patent Portfolio” figure.

The overall size and scope of the patent portfolio is shown by purple colored indicators in upper right quadrant of the graphic. These indicators show what world-wide geographies the company is filing in and what the size of each geographic portfolio is.

This is followed by the light blue colored indicators in lower right part of the graphic. These indicators are related to the validity and value of the portfolio. They answer the questions related to “is it likely the patents are valid?” and “is the art likely to be key technology?”

When working with partners, the size, depth and breadth of the portfolio available for adjacent technology ventures is shown by the darker blue colored indicators in the lower left quadrant. This gives an indication regarding if the patents cover more than just a single field of interest and if the patents are still in force.

Finally, for both competitors and potential partners alike it is important to know if they have retained the inventors and other resources necessary to continue sustained leadership and participation in their field. The light yellow colored indicators in upper left quadrant address these issues. They show if there are partner companies that could add to sustainability efforts, and if inventors are working in sustainable teams.

In this example, using a relevant technology/business benchmarking patent database we see a “Client” has a small but strong portfolio. The geographic scope and overall patent portfolio size is relatively small and focused on the US and Europe. The portfolio contains an unusually large number of highly cited-by patents. The patents cover many fields and uses. The number of patent assignees is very high. What can be concluded from these findings is that the high cited-by counts indicate that the patents tend to be key patents in their areas, that the client takes advantage of partnerships, and that the company has a small innovative organization, and what it does, it does well.

Evaluation of a Competitor’s Patent Portfolio

Competitor A’s Patent Portfolio

In the “Competitor A’s Patent Portfolio“ figure, the art held by this competitor is moderately strong in all four categories. The portfolio is of a moderate size. Applications and patents are filed worldwide. The number of references and cited by counts contained in these patents and applications is around the average for benchmarked companies. The portfolio covers a broad range of patent classifications and technical fields. The number of inventors and assignees is high. From this information it may be concluded that the patents have a pattern associated with art that is typically held to be valid, the art is solid, but not typically key in the industry, and that the portfolio is a good one for out-licensing because of its broad technical coverage.

Competitor B’s Patent Portfolio

The “Competitor B’s Patent Portfolio“ figure shows they have a weak position. The portfolio is about the same as the client but distributed across the geographic areas. The patents are likely to be narrow and out of the mainstream work of the field. The age of the portfolio is high. This company has a high number of multiple assignees on its patents. In conclusion, this company’s art is likely incremental in nature, pursuing a cost-centered fast-follower strategy, and is not investing in new R&D.

Competitor C’s Patent Portfolio

The “Competitor C’s Patent Portfolio“ figure shows a company that is just getting started in the field. This company has few patents. The patents they do have are highly referenced. The portfolio is young. The work is done by sole inventors and not with others or other companies. In summary, this is likely a start-up company intent on competing with its intellectual property.

Evaluation of a Competitor’s Patent Investment Velocities

Investment Velocities

To find out if the field is active the number of patents published per year is plotted as shown in the “Investment Velocities” figure. This is referred to as investment velocity because the work done at the Industrial Research Institute found that issued US patents correspond to approximately $1 million spent in new business development efforts. The metric is very rough but typically for companies in the same industry and market space the number of patents correlate well to the relative R&D and business development investment dollars spent.

In this example study, Competitor A’s patent velocity has been sporadic. They sustained a moderate level of activity for their size and industry during the mid-1970’s to late 1980’s. Through the 1990’s however their activity increased again. On the other hand, Competitor C has been around for several decades but there has been a sudden and large jump in recent activity. What can be concluded from this information is that for both competitors the significant change in activity indicates a potential change in management posture in the mid- to late 1990’s towards investment in this field. The sudden and large jump in activity is a new behavior and likely the result of corporate initiatives in a new hot business area that has spread across competitors. Note that for Competitor A the bursts of activity are typically associated with market problems or product upgrades that required new R&D to solve.

Evaluation of a Competitor’s Specific Business/Technology Areas of Investment Focus

Specific Business/Technology Areas of Investment Focus

To understand the areas of investment in more detail the landscape map is made from the text found in the patent specification. Since passive since patent specifications cover both business and technology elements the landscape map of the “Specific Business/Technology Areas of Investment Focus” figure can be used to understand who is really competing with whom.

On this map the colored dots show the location of each company’s art on the landscape formed from all patents and applications. Observations from the map are that the Client’s work (shown as blue dots) on the IP landscape is focused in several distinct areas away from its competitors. Competitor A (yellow dots) and C (purple dots) have the most overlap with Client. Competitor B (brown dots) has the least. Additionally, Competitor A’s portfolio is spread over most of the landscape, whereas Competitor C has the most targeted portfolio. In summary, Competitors A and C offer the greatest technical threat. Competitor B would provide the most synergy in a partnership arrangement.

Evaluation of a Competitor’s Use of its Patent Portfolio

Use Map for Assessing Internal Value to a Corporation

To further assess the internal value of the “Client” patent portfolio, it is mapped on the “Use Map” as shown in the figure. In this graphic patents are placed on grid rows based on which business they are protecting. For the vertical “Business Cycle” scale the three areas are defined by (1) “Growth Business” is growing double digits, (2) “Core Business” is growing single digits, and (3) “Mature Business” is holding its own or declining. Patents are place in columns based on the state of the product or process they protect. For the horizontal “Direction” scale, the four areas are defined by (1) “Commercially” is being offered for sale now, (2) “Strategic” is in written into current operating plans, (3) “Potentially strategic” is in written into current strategic plans, and (4) “Outside” is in none of the above. Likely conclusions that can be taken from a completed matrix include identification of art that the Business should be willing to license lies in the upper right quadrant, and art that the Business should maintain and build further patent fences around lies in the upper left quadrant.

Evaluation of a Competitor’s Value of its Patent Portfolio

Value Map for Assessing Internal & External Value to a Corporation

When the number of patents from all parties of interest is less than 100, they can be further checked for the internal and external value of the respective patent portfolios. To do so they are mapped (own company “client” along with competitor portfolios) on the “Value Map” as shown in the figure. In this graphic patents are placed on the grid one by one, denoted here by text inserts and yellow dots in the figure. The x-axis placement is determined by the relative cost to create and deliver the product and the y-axis placement is determined by the relative performance of the product as perceived by customers. Likely Conclusions that can be taken from this viewpoint are that art in the upper left is of high value, should be maintained, and have patent fences built out around it. Art located in the lower right is of very low value and should be donated or abandoned. Art in the upper right and lower left is licensed per a company’s brand image.

SWOT of a Patent Portfolio

To summarize all the above information for the management team, the assessment this competitive intelligence team produced would be put into four bullet points:

Strengths: Established industry, Competitive yet healthy rivalry, Competitors have different strategies and approaches, and the portfolios are suited to protect each companies own business interest.

Weaknesses: No strong IP player, All portfolios are small to moderate in size, Industry is likely cost competitive without a high performance leader.

Opportunities: Change industry structure with protected innovation, Out-license technology to other industries for increased revenue generation, and Partnership opportunities exist in the current competitive set.

Threats: There has been a recent, large, and upward change in patenting activity, mirrored by several companies. Since the velocity of patenting activity is increasing, an aggressive posture is required, and Patent conflicts are not likely, but when they arise, Competitor A would be the probable party to bring suit.

Mining Pharmaceutical and Biotech Sources

Understanding what a company is really up against in the pharmaceutical and biotechnology areas is certainly a challenge. In her paper on “pharmaceutical and biotechnology assessment on a slim budget”, Candace Hughes points out that on the one hand there are large number of for-pay resources that have extracted information and specific market in therapeutic areas. On the other hand, a general Google search in general areas can yield an overwhelming number of search returns.

Pharmaceutical and Biotechnology Related Internet Site Resources

In order to get the best search results on unusual target or market areas, is recommended as a search aggregator in order to collect returns that individually Google and other search providers might miss. Alternative search engines that are targeted more toward scientific and medical information include Other medical and scientific search engines on the web can be useful are, HON MedHunt, and When looking at the latest data from clinical studies, a useful resource is Once a study is completed, you can look for the results on The “Pharmaceutical and Biotechnology Related Internet Site Resources” figure lists these and other resources.

Another way to learn about early-stage research ahead of meeting presentations is through press releases. Website Science Daily collects and post research related press releases. Other interesting pharmaceutical and biotech blogs to provide useful pharmaceutical and biotech information include: (1) (2) (3) (4) (6)

Mining SEC Forms

8-K Item Codes

In his article on “Mining SEC forms for material events”, Michael Levy points out that competitive intelligence professionals are benefiting from the fraud committed at the end of the late 1990s. In attempt to prevent future fraud and improve corporate transparency, the SEC mandated a broader set of 8K material filings and shorter filing windows. The SEC also expanded the classification system of material events making it easier for CI professionals to research the financial, strategic, and personal decisions of US public companies. The “8-K Item Codes” figure provides an example of what is available.

The new material events subject to immediate filing include (1) off-balance-sheet arrangements, direct financial obligations, or changes in financial obligations, (2) significant layoffs, facility closures, or material impairments, (3) recognition that previously filed financials can no longer be relied upon, (4) noncompliance with exchange listing standards or an impending delisting, (5) material definitive agreement such as executive compensation packages or significant customer wins and losses, (6) changes in rules of incorporation, bylaws, or fiscal year, (7) changes to waivers of corporate code of ethics. For competitive intelligence, probably most important change is that the disclosure filing is now down to four business days. This makes SEC filings extremely useful and current.

Material weaknesses may be reported in 8-K filings or in standard 10-K and 10-Q submissions. A material weakness disclosure not only flags internal control issues, but could also result in (1) stock price volatility and price declines, (2) credit rating reviews and possible increase in the cost of capital, (3) shareholder lawsuits, (4) increased regulatory scrutiny, (5) increase in directors and officers insurance costs, (6) an increase in both internal and external audit and accounting compliance costs, (7) executive turnover, (8) damage to a firm’s reputation, particularly if the disclosures are fraud related and result in subsequent restatements of firms financials.

Thus an 8-K should be reviewed as an indispensable tool monitoring competitors and industry. All this said, some events are still difficult to directly track. For example mergers and acquisitions activities are often difficult isolate using the SEC item classification system. To further complicate matters, material definitive agreements also include credit facilities, executive contracts, another non-material M&A related agreements. As a workaround, the terms of the plan of M&A agreement found in the SEC filings do pretty good job of identifying merging firm items. It should be remembered that 8-K reports can be an invaluable source of company and industry competitive intelligence. This is because while 10-K reports are published only quarterly and are historical reflections of a firm’s performance, the 8-K discloses company events dynamically and thus in of themselves allow a CI professional to proactively monitor competitors and peers.

Sources, References and Selected Bibliographic Information

1. “Mining SEC Forms for Material Events and Weaknesses” by Michael Levy, Competitive Intelligence Magazine, SCIP, 2005.
2. “Pharmaceutical and Biotech Technology: Assessment on a Slim Budget”, by Candice Hughes, Competitive Intelligence Magazine, SCIP, 2006.
3. “CI Business Valuation”, by Margaret Horne, Competitive Intelligence Review, Vol. 3, 1999.
4. “Third Generation R & D: Managing the Link to Corporate Strategy” by Kamal N. Saad, Philip A. Roussel, and Tamara J. Erickson, Arthur D. Little, February 1991.
5. “Technology Intelligence” by Merrill Brenner, Competitive Intelligence Magazine, SCIP, 2005.
6. “Two tools for M&A analysis” by Paul Dishman, Competitive Intelligence Magazine, SCIP, Mar 2000.
7. “Supporting Strategy with Competitive Analysis”, by Mathias Coburn, Daniel Greenwood and Martha Matteo, Research Technology Management, Oct. 2002.
8. “Code of ethics”, by Society of Competitive Intelligence Professionals, Competitive Intelligence Review, Oct-Dec 1998.
9. “Developing a CI Program in Telecoms”, by Marceau and Sawka, Competitive Intelligence, 1999.
10. “The Competitive Assessment Process”, by John Hovis, SCIP presentation, Mar 2000.
11. “Competitive Assessment Overview”, by Langabeer, Competitive Intelligence Review, 1999.
12. “Key Intelligence Topics”, by Herring, Competitive Intelligence, 2000.
13. “Secondary Sources of Competitive Intelligence”, by Chuck Klein, Competitive Intelligence Magazine, SCIP, Sept 1999.
14. “The Innovator’s Solution Toolset”, by Sam Johnson, Competitive Intelligence Magazine, SCIP, Feb 2004.
15. “The Four Analytical Techniques Every Analyst Must Know”, by Kenneth Sawka, Competitive Intelligence Magazine, SCIP, Sept 2003.
16. “Supporting Strategy with Competitive Analysis”, by Mathias Coburn, Daniel Greenwood and Martha Matteo, Research Technology Management, Oct. 2002.
17. “Competitive Vectors”, by Robert Cantrell, Competitive Intelligence Magazine, SCIP, Feb 2003.
18. “Structured Analysis of Competing Hypotheses”, by Kristan Wheaton and Diane Chido, Competitive Intelligence Magazine, Dec. 2006.
19. “The Psychology of Intelligence Analysis”, by Richards Heuer, Central Intelligence Agency, 1999.
20. “War Rooms”, by Mark Johnson et al, blog discussion at, 2009.
21. “The Fuld War Room: The Ultimate in Competitive Intelligence Audio CD”, by Leonard M. Fuld, Amazon, 1999.
22. “Tech Mining”, by Alan Porter and Scott Cunningham, Wiley, 2005.
23. “From Process Through to Measureable Deliverable”, by Andrew Beurschgens, SCIP, Oct. 2008.
24. “The use of competitive intelligence in IP monetization”, by Raymond Millien, Intellectual Asset Management, April 2014. .
25. “Perspective on Differences between CI and CTI”, by Jay Paap, personal communication, April 2019.