A smart security professional must learn the difference between competitive intelligence and industrial espionage
Over the course of the past few years, there has been an increasing amount of concern about the emerging area of competitive intelligence and what implications it has for security management. Unfortunately, the term competitive intelligence has been used interchangeably with many other phrases and buzzwords, sometimes even by people who should know better. Some of these other terms include industrial espionage, trade secrets theft, proprietary information loss, and patent violations. But, it's more than a matter of mere semantics.
The difference between competitive intelligence and industrial espionage, for example, is significant. By definition, industrial espionage refers to illegal activities - which range everywhere from outright theft to bribery and everywhere in between. Conversely, competitive intelligence collection is governed for the most part by adherence to corporate and professional ethics which preclude the use of illegal means to obtain information.
As the accompanying Code of Ethics shows, members of the Society of Competitive Intelligence Professionals (SCIP) adhere to a set of standards which does not cross over into illegality. On the other hand, however, there is nothing Pollyanna-ish about the typical CI practitioner. They're very active, very thorough, and very successful - that's the reason that SCIP is among the fastest growing professional societies in the world. And the reason that more and more companies are employing CI methodologies to gain competitive advantage in today's marketplace.
Moreover, the distinction between the two is in terms of modus operandi. If a security manager doesn't understand the differences in methods, then the company's procedures for dealing with the problems will be facing in the wrong direction. This would be like building a Maginot Line- and ignoring the Low Countries route - to keep Hitler out of France.
Hitler, giving the devil his due, knew that to attack on the strongest point would simply be a repeat of the bloodbath of face-to-face, trench warfare of the First World War. That he attempted to reach his strategic objectives indirectly rather than directly and with great potential loss can perhaps be seen as an analogy with the way that things are increasingly being done in business today. This is not to equate Competitive Intelligence professionals with Hitler, but rather to suggest that they look at things "outside the box;" they obtain the information their organizations need through a variety of legal means.
Perhaps another analogy may also be useful. Nations rarely assign street patrolmen to root out and neutralize spies; neither do they employ their counterespionage organizations to deal with homicides, auto theft and bank robbery. Each problem has it's own peculiar solution sets.
The purpose of this - and a series of articles to follow - is to provide Security Technology & Design's readers with a better understanding of this increasingly important concern to companies. This is not just the concern of companies that operate internationally and are confronted with the specter of those foreign intelligence services who operate on behalf of their national businesses. It's also the concern of domestic firms.
The Competitive Intelligence Process
At bottom, the competitive intelligence process consists of collecting information - as elements - which when legally, ethically but rigorously collected and analyzed, can provide the same kinds of information as might otherwise have only been available through such illicit means as theft. Burglary, outright theft or bribery might be some of the ways that criminals would resort to in order to obtain what a competitor may need. But, techniques that are well within the law and within the SCIP Code of Ethics are so effective that a comoany doesn't need to break the law.
As a closing note, the competitive intelligence process is sometimes used in reverse. On the plaintiff side in legal proceeding, this role reversal can be used as an aide in deciding whether or not a company should go to court for a possible trade secrets theft or violation case.
For example, if the company employs the techniques common to competitive intelligence collectors - and finds that the essential elements of their supposedly confidential or proprietary materials are available through legal means - then they will be able to determine whether or not they actually have a case.
On the defense side, a company may hire an outside competitive intelligence consulting firm which will conduct a completely open and above board collection activity. Then, with evidence that the information is available through the use of open, legal and ethical means, any claim that the pliantiff may make that they have taken the appropriate and realistic protection measures - consistent with prevailing conditions - falls on deaf ears.
About the author: John A. Nolan, III CPP, OCP is Special Advisor, Intelligence Training and Solutions, DynCorp International. Previously he was Chairman and Managing Director of Phoenix Consulting Group, which provides competitive intelligence, counterintelligence and professional development/training programs across a variety of industries. He is also a co-founder of The Centre for Operational Business Intelligence in Sarasota, FL where corporate intelligence practitioners from around the country and the world learn the tools and techniques necessary to prevail in the marketplace.
