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Companies that ignore the CIO do so at their peril. "We recently came across a large telecom equipment maker with 10,000 home pages on its supply-chain intranet," says Leonard Fuld, CI consultant and president of Fuld & Company Inc. in Cambridge, Mass. "Several hundred of them were dedicated to the competition. But there was no coordination between them. This was a situation where the CIO could have taken charge and made sure the information was in one spot. How many tens of millions of dollars were thrown at that intranet and wasted annually in inefficient man-hours?"
Where to begin? Ideally, Steinhardt says, CIOs can help marketing and sales strategies turn on a dime. CI teams should spend one-third of their time on a project gathering information, one-third in analysis and one-third discussing their findings. "Instead," says Steinhardt, "many companies spend 80 percent of their CI time on collection, most of the rest on analysis and very little on communication that reaches everyone." CIOs can step in and devise ways to improve the ability of executives to focus on information that really matters to them "with filters that take out the junk nobody needs to be looking at," she says.
CIOs also can help determine what the company considers junk. Often, she says, the best competitive information does not appear as highly structured data, such as financial information. More likely, it's something like an offhand comment in a press release, a photograph in a rival's advertisement or a soundbite from a television news show.
Once the best data is tagged for collection, who gets access to it? "If you search, say, for data involving a two-in-one laundry soap and fabric softener, what terms do you classify, and which do you let everyone see?" Steinhardt says. Her point: CIOs can help companies figure out how to tag, gather, store and distribute a wide range of competitive data with differing levels of access and indexingand with standards that are consistent throughout the company, domestically and abroad. "Most companies are sloppy about this," says R. Mark Halligan, a professor of trade secret law at The John Marshall Law School in Chicago. "They haven't marked documents as confidential. And nobody beyond a certain level knows what, specifically, they're looking for. They just know they want something, and fast. And with a proliferation of business relationships these daysjoint ventures, M&As, supply-chain collaborations and so forthyou really need to do an information audit to make sure you know what you have and what you need."
Finally, build teams with diverse membership. Using a library research professional at P&G, Steinhardt found, saved the company time on one CI project and the equivalent of four full-time researchers. "People who understand the concept of organizing information and indexing it could be paired with someone who understands different technology capabilities, such as a relational database showing connections between different terms or items," Steinhardt says. As managers, CIOs have to amass different strengths on a CI project "so you don't have an abundance of hammer holders who look only for nails."
But don't get carried away on the technology. A study conducted by Fuld & Company found flaws with many of the 170 software packages with potential CI applications. Says Fuld: "None of them were able to take companies through the process of data identification, discovery, distribution and analysis. Each did some part of the process, but not the whole thing. The thinking machine has not yet arrived." He warns that no company should buy a software package "in the hope it will build an intelligence process for the corporation. CIOs need to help build that. It won't come off the shelf."
Still not convinced? CIOs confident that their rivals' intranet data is too safe to even try prying open should take a ride with CI consultant Todd Waskelis in Virginia's Dulles Corridor, a throughway outside Washington, D.C. lined with high-tech firms. Waskelis can slip a wireless card into his laptop, drive down Route 7 and pick up one wireless network after another, including the networks of a major credit clearinghouse. "Instead of hacking from the Internet, people can hack from inside on the intranet, albeit from the road, and probably get to the accounting server," he says.
But for all the digital dumpster-diving out there, don't forget that plenty of old-fashioned snooping is still being used by even the most high-tech firms. When Oracle Corp. got caught last summer hiring a Washington, D.C.-based detective group to dig into the dealings of organizations sympathetic to Microsoft Corp., it didn't use even a byte of cybersleuthing. It did it the old-fashioned wayrummaging through the dumpsters of one of those groups by bribing janitors at its Washington office. Says Nolan: "In this business, be aggressive. Take the offensive." And, say CI experts, recall the words of ancient Chinese general Sun Tzu: "Be so subtle that you are invisible, be so mysterious that you are intangible; then you will control your rival's fate."
SKIP KALTENHEUSER writes about technology and legal issues from Washington, D.C. KEITH EPSTEIN is an investigative reporter based in Fairfax, Va. Comments on this article can be sent to firstname.lastname@example.org.