Being cognizant of what is happening outside one’s own milieu is one of the vital components of success. From a reductionist perspective, observing the environment, competitors, their intents, strategies and tactics collectively fall under the umbrella of external analysis. Proponents of benchmarking such as strategic decision-makers, equity analysts etc would argue that external analysis is often most useful exercise if conducted judiciously.
Proactively monitoring the external environment and its constituents is routinely performed by multiple functions and at various levels in an organization. For instance, at the corporate end of the spectrum, external analyses are conducted through, inter alia PEST, SWOT, Five forces framework and needless to mention explicit financial benchmarking. At the other end of spectrum i.e. at a single asset level, external analyses are usually conducted through the lens of marketing, often as part of 4Cs analysis. Similar strategic analysis tools are employed for intermediate position occupying aggregated assets such as R&D portfolio, franchise, SBUs etc.
All the external analyses have fundamental goal of helping the organization create and sustain competitive advantage, perform better thereby ultimately create value for its shareholders. Optimizing the external analyses for supporting decision-making, irrespective of them being conducted in-house or though external parties, is one of the key imperatives. Extracting most return from competitor’s analysis, competitive landscaping, context analysis, external benchmarking often requires finessing of several factors and some of the best praxis are summarized below.
1. Get Into Your Competitor's Brain
The benefit of understanding the competitors' game plan equips one with reasonable predictive power. Amalgamated with the intelligence, one can anticipate the future course of actions and events, which helps to reduce unwanted surprises, reveal blind spots, refine strategy and tactics dynamically, future-proof one's own strategy etc.
2. Collect Intelligence and Construct Mosaic
Are you able to fit established strategy frameworks and decode competitor's strategy? This is the key element of deciphering strategy. You need to know the different frameworks of strategic management.
3. Generate Decision-maker's Virtual Reality
Role play decision-making process both from internal and external perspective.
4. Align Actions and Execution
Select appropriate vendors and align them with your objectives. Addressing the issues mentioned below streamlines intelligence gathering by making them more ready for decision-making.
Repeat the above mentioned four steps to refine further in order to get most out of your external analyses.
BiopharmaVantage is a specialty strategy consultancy that provides competitive intelligence and decision support services to pharmaceutical companies.
Last updated on: 13/10/2016 18:34:21
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