Competitive intelligence ethics
The short answer is that yes, competitor intelligence is an ethical business activity. In that sense, it is no different from traditional market research. Ethical competitive intelligence is not difficult.
The longer answer is that competitor intelligence gathering can stray into unethical territory, and it’s important for competitive intelligence professionals to understand the risks and have policies for adhering to business ethics.
We have a simple rule (as well as more formal ethical guidelines) that governs our intelligence gathering: if you find yourself asking whether a practice is legal, then you probably shouldn’t be doing it. We avoid practices that fall into grey areas - ethical competitive inteligence is no less effective and avoids undue risk. Competitive intelligence activities can follow ethical standards without compromising the level of insight produced.
Ethical competitive intelligence is not difficult
Competitive intelligence is a process of learning about your market and your competitors. Not knowing what your competitors are doing would be negligent – the equivalent of setting up a shop without planning the location. It’s simply good, basic business sense.
However, this justification has limits.
Yes, competitive analysis is completely ethical , but competitive intelligence professionals must take care that they don’t go beyond ethical competitive intelligence. No corporate espionage. No industrial espionage. No trade secrets. No confidential information. Keep the Economic Espionage Act in mind. No illegal practices. Follow applicable laws. It's not difficult.
Market intelligence companies like Aqute, that perform competitive intelligence research for clients, have to be aware of the issues of trust, privacy and confidentiality, and ensure that all market research activities are well within the bounds of the law.
Gathering publicly available information and asking questions of industry professionals is an accepted business activity, and is a normal and natural part of trading. It is a core part of ethical competitive intelligence. For example, if your firm attends a trade show, you will learn about your competitors from their own representatives and through conversations with other delegates.
The only difference with a competitive intelligence firm like Aqute is that we conduct this research on behalf of our clients.
Competitive intelligence firms are unlikely to engage in any activities that cross ethical or legal lines, because doing so would endanger their business and limit their potential. After all, corporations need to be able to trust their partners, and any firm engaging in corporate espionage or unethical practices would soon develop a negative reputation and would be seen as too risky for all reputable firms.
Practices that are unethical or outright illegal include theft of information, eavesdropping on conversations and hacking into IT systems. Obviously, don’t do these.
The industry body for competitive intelligence firms, SCIP (Strategic and Competitive Intelligence Professionals) has a defined code of competitive intelligence ethics:
To continually strive to increase the recognition and respect of the profession.
To comply with all applicable laws, domestic and international.
To accurately disclose all relevant information, including one's identity and organization, prior to all interviews.
To avoid conflicts of interest in fulfilling one's duties.
To provide honest and realistic recommendations and conclusions in the execution of one's duties.
To promote this code of ethics within one's company, with third-party contractors and within the entire profession.
To faithfully adhere to and abide by one's company policies, objectives and guidelines.
Double blind research supports ethics in competitive intelligence activities
One key technique for ensuring that our researchers are not influenced by their knowledge or bias is to anonymize our research (double blind research). This means that our researchers have a clear research brief, but they never share the client’s identity with interviewees. And we never share details of our interviewees with our clients. This encourages our interviewees to speak freely and give us an honest report of their experiences.
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