Leveraging Enterprise Architects for Competitive Advantage
Gaining competitive advantage requires an investment in competitive intelligence tools and resources. Yet for many companies, enterprise architects can provide some of these capabilities right away.
Companies Do Not Exist in Isolation
As an enterprise architect and consultant, I spend much of my time focusing on how to marry strategic vision with tactical execution. This requires implementing a combination of technology, people, and processes to further corporate goals.
I’m also frequently pulled into “in-flight” enterprise projects; initiatives which have already commenced, but are experiencing turbulence along the way. When examining such programs, I often ask questions such as:
- How did we get this far?
- Are our assumptions sound?
- What’s the ROI of this project versus the many other things contending for our attention?
- How does this project “move the needle” towards the corporate mission or goals?
While an enterprise architect is typically focused on “what” to build or improve upon, lately I’ve been asking more questions along the lines of “why.” Why are we doing this, and why will we (as a company) be better off if we’re successful?
Another observation I’ve had as of lately is that many corporations tend to concentrate inward. They hyper-focus on internal operations of the value chain: software development, sales and marketing, and so on. Indeed, leaders need to focus on corporate capabilities such as these. Yet companies do not exist in a vacuum. Corporations are mutually dependent on each other’s competitive forces. That is to say, they function synergistically within a competitive market-based ecosystem. If one company similar to yours creates a new feature, your company may do the same. If a competitor of yours lowers prices, you may do the same, etc.
The takeaway here is: enterprises are focused on themselves. But at some point, one must raise the periscope above the vastly complex enterprise submarine, and examine the waters around you. Are there other submarines or ships nearby? Are they hostile, friendly, or neutral? Can we work with these other vessels, or should we navigate around them?
These external perspectives have a profound impact on how an enterprise charts its course. Unfortunately, I rarely witness business professionals asking these questions. Instead, they keep their focus positioned inward on the enterprise submarine; blissfully unaware of adjacent vessel movement.
Competitive Intelligence Explained
As the name suggests, competitive intelligence is all about collecting competitor information and synthesizing that information into actionable insights. Corporate competition is a lot like a boxing match in that you need a strategy to win. If you are a featherweight fighter and your opponent is a beastly heavyweight bruiser, your best course of action is to avoid head-to-head combat. Likewise, if your company is the proverbial 800-pound gorilla who can lower prices to starve out scrawny competitors, that’s also good to know.
Conducting competitive intelligence involves a vast range of data collection. Financial information, hiring of various positions, social media sentiment, and press releases to name only a few. While most if not all of this information is publicly available, the secret sauce of CI revolves around teasing out relevant information, and piecing together insights that aren’t explicit. As a trivial example: if you observe a traditional automaker making acquisitions of electric motor and battery manufacturers, you can surmise that the car maker is pivoting into the electric car marketspace.
Competitive intelligence can be practiced at many different levels. At a macro level, one can examine the overall addressable market space, and how your enterprise can defend a serviceable position of that space against incumbents. At a company level, a comparison of strengths and weaknesses can reveal far better tactics for direct competition. And at a product level, comparing capabilities and features can ensure your product remains differentiated.
The Importance of Competitive Intelligence
Here’s a fun experiment for executives: ask each of your department heads to answer these three questions:
- Name three of our competitors
- Why are we better than them?
- How are they better than us?
Depending on how similar or different the answers are, the results may be surprising.
For even wilder results, ask a handful of your lighthouse customers the same question. I guarantee the answers will surprise you, because a customer’s perception of alternatives always varies from a corporation’s view of competitors. With all the information at the buyer’s fingertips, buyers are more educated than ever, and will likely compare your offering(s) to companies you wouldn’t traditionally consider as direct competitors.
The importance of competitive intelligence cannot be overstated. Competitive intelligence:
- Aligns internal leaders on the marketspace, competitors, and product capabilities
- Educates leaders on market adjacencies
- Sizes up your competitors weaknesses so you can exploit them, while understanding their strengths so that you can stealthily outmaneuver them (thus avoiding costly head-to-head competition)
- Sheds light on how customers view your offerings against perceived alternatives
- Keeps leaders abreast of new offerings / market entrants as they emerge
All of these data points directly influence how a company operates day-to-day. For example, if your company is a project management software company, and all of your competitors provide basic project cost management, one can assume this is a “table stakes” feature that any competitor must have. Yet, features such as advanced resource management may be less common, and therefore a differentiating feature. The point is: information you collect about your competitors will facilitate different activities and outcomes for your enterprise. The goal, of course, being that better intelligence yields better decisions.
Circling Back to Enterprise Architecture
Many of the analytical tools needed for internal enterprise architecture can actually be reused; essentially applying them outward towards competitors to assess competitive advantage. Techniques such as capability mapping, business model canvasing, SWOT analysis, and so on are all tools-of-the-trade which may yield tremendous value when pointed at the competition.
Enterprise architects are typically data-savvy, and can not only collect and correlate information, but can automate collection and display information in a business-friendly fashion. Competitive intelligence is all about data, so understanding how to collect raw data, refine that data into actionable information, and routinely present the data to decision makers should be a skillset in any EA’s wheelhouse.
Focusing on external companies isn’t necessarily a traditional responsibility of an enterprise architect, and depending on existing workload, CI activities could potentially detract from EA focus. However, as companies are expected to do more with less, it never hurts to entertain the idea of leveraging existing resources and capabilities in novel new ways.
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About David Torre
David Torre is a business technology veteran with years of experience coupled with degrees in both information systems and business intelligence. This combination of skills has enabled David to provide enterprise solutions to well-known companies who face some of the toughest challenges in the business world today.
David currently resides in the San Francisco Bay Area where he runs Center Mast, LLC.