Indicators and signals: what are you really seeing?

Written by Jonathan Dunnett

When I first saw this picture, it really made me laugh. After I finished laughing, it made me think of a lot of businesses that I see. How often are we NOT seeing the full picture?

Think about a few scenarios:

  • Your competitor just hired a new COO.

  • A supplier just changed financing terms on you. You’ve had the same, favourable terms for 10 years, and now they’ve changed.

  • A customer that you’ve always worked with and with whom you’ve had a great relationship has stopped returning your calls and your emails.

In isolation, each of those scenarios COULD have significance, but you don’t know for sure. Consider a few more indicators or signals:

Your competitor just hired a new COO.

  • The COO has deep R&D experience in your industry, and you’ve been trying to rush to get the next generation of your product out the door.

  • They’ve also hired 10 people in the last year with R&D experience, ranging from junior to senior.

  • You’ve heard rumblings from customers that your competitor is talking about new product offerings coming out soon.

  • You have been watching patent filings, and you noted that two years ago, there was a patent filed that could revolutionize your industry, and the competitor filed it.

In this scenario, the signals and indicators would seem to suggest that the competitor is really focusing on product development and bringing out the next generation of their product. Depending on where you are in your product development cycle, you MAY need to respond to this by accelerating your development cycle, talking with customers to ensure they are happy with their current product (especially if the product is “sticky” [read more: What is a sticky product?] and hard to tear out of an organization), talking directly to competitors to find out what their next generation looks like (ethically, of course), or some other response, depending on your situation.

You might also NOT respond to this, depending on your industry. For example, if you know that customers want a certain price, but the next generation of products will be three times as expensive as the market will tolerate until it reaches scale, you might choose not to run quickly.

Understanding your market and your business will dictate your response.

A supplier just changed financing terms on you. You’ve had the same, favourable terms for 10 years, and now they’ve changed.

  • This supplier just got a new CEO that has a history of cost-cutting.

  • You’ve noticed the monthly complimentary donuts no longer come to your door.

  • All of your competitors are complaining that their terms got changed as well.

In this scenario, chances are, the CEO with a track record is the catalyst for change. Clearly, something has shifted internally at the company. You might see other things like people being less friendly (it could be impacting morale), travel budgets or discretionary budgets being decreased (the annual golf tournament is gone), and even long-term employees being let go.

A new CEO doesn’t mean much, but when you start stacking all of these things, this could indicate that you may have to change your pricing, shop for different suppliers, or take some other response to this change.

A customer that you’ve always worked with and with whom you’ve had a great relationship has stopped returning your calls and your emails.

  • You’ve emailed and called them 5 times in the past month; before, they would get in contact with you in 30 minutes or less.

  • Ordinarily, they are heavy LinkedIn users. You haven’t seen a post from them in three months.

  • You set up a Google Alert for your contact’s name and it comes back that their spouse was in a car accident.

Clearly, in this situation, the car accident tells at least part of the tale. It may be that they’re working as much as they can, but that they are completely overwhelmed right now with their personal and professional life. Remember, we didn’t see an out-of-office, we just saw unresponsiveness.

In this scenario, all of the indicators suggest a change, but it’s that fourth indicator that really shows the likely “why” for the change.

In business, you have to look for the fuller picture. At minimum in competitive intelligence, we say that you have to verify your information from two non-related, corroborative sources. That means that at least two different sources have to indicate the same answer, and they can’t somehow be connected to each other.

Whether that is a website, talking to a supplier or customer, or by whatever means you are getting your information, you want to ensure that you have the fuller picture.

So, when you start seeing something happening in your business that makes you go, “that’s unusual”, or, “that’s weird”, ensure you seek to understand the whole picture. Set up early-warning systems to let you know when something big is coming down the pipe that you don’t want to find out about too late.

Have questions about competitive intelligence? Find out more here or get in touch with me.

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