Chapter 6: International Intelligence

Why do so many business people and journalists still think "foreign" when talking about overseas competitors? Nothing in business is truly foreign anymore. It's "international". Foreign means apart from, separate. Foreign means Us versus Them. If you think "foreign" then you create information barriers, barriers that will make it nearly impossible to track international competition. Do you want to develop intelligence on your competition? Then think about one big market and not another solar system.

International Intelligence

Here is a scary piece of trivia.

Did you know that as late as the mid-1980's only an estimated 7% of the 10,000 technical titles published each year in Japan were ever translated, abstracted or indexed by Western nations?1 This means that although much of critical intelligence is being made available through the Japanese themselves, most European and American companies are just not taking advantage of the 10,000 or so intelligence opportunities that present themselves each year.

Contrast this fact to conversations I have had with managers at Japanese firms who attest to the fact that they have staff in their home offices who translate virtually all significant English-language business and technical documents for management.

It would be misleading to simply state that just translating documents is all you need do to develop the necessary intelligence on your overseas markets and competition. It is not. But it is a necessary step. There are many first steps you need to take. This chapter will introduce you to both the basic and the more advanced approaches -- such as Intelligence Maps -- to developing intelligence on your international competition. These techniques are based on the ones we have used around the globe for my firm's client.

The moment you step outside your country to conduct research on another company, you will find many unforeseen language, cultural and information barriers. In order to conserve both your time and your budget, you need to follow a common-sense set of information-gathering steps. I have laid out this chapter to reflect these steps. They are as follows:

1) Tapping Into U.S. - Based Resources

• In-House Resources
• Track Target's Operations Through U.S. Locations
• U.S. Government
• Securities Analysts and Banks
• Trade Shows and Conferences
• Business and Trade Groups
• Embassies and Consulates
• Universities
• Accounting Firms
• Libraries

2) Overcoming Cultural and Language Barriers

3) Intelligence Maps: Country-Specific Research Strategies and Sources

Please note: Inevitably, addresses and telephone numbers for sources listed in this chapter will change over the years. Contact your local consulate or embassy for the country in question and ask for the commercial attaché or information officer. That individual should be able to help you to track down most of the government offices, as well as many of the publishers listed. You will also find many of the magazines listed in Ulrich's International Periodical Directory (R.R. Bowker.

Tapping Into U.S.-Based Resources

In-House Listening Posts

The cardinal rule of international corporate intelligence is:

The best international intelligence resource is still your own organization.

The vast majority of the intelligence you need is probably available from within your own company. And, even if your firm does not have offices outside the United States (or, wherever your home office may be), you may still have contacts worldwide through your trade representatives, affiliates and suppliers. Consider all these groups as extensions of your organization.

Let's take an inventory of some of these home-grown listening posts:

• Acquisitions & Mergers
• Advertising
• Credit
• Customer Service
• Distribution
• Engineering
• Finance
• Human Resources
• Information Systems
• Legal
• Library
• Marketing
• Purchasing
• R&D
• Real Estate
• Sales

You must consider these departments in three-dimensional, not two-dimensional terms. For example, a sales person may know a great deal about a particular competitor or a specific technology. But that same sales person also knows about that competitor by region or by country. You need to appreciate that your organization -- particularly if it is a globally based company -- has all three informational dimensions: Competitor-specific; Product- or technology-specific; and specific by region or by country.

Conduct The International Intelligence Audit
In order for you to truly understand the international intelligence resources your company possesses, you need to conduct an Intelligence Audit. An Intelligence Audit is an inventory of your company experts and their information resources, resources not cataloged in your company library. In a sense, the Audit takes your corporate telephone directory and re-indexes it by expertise and knowledge rather than by department. The auditing process is described in greater detail in Chapter 17 and in, Monitoring The Competition: Find Out What's Really Going On Over There (Leonard M. Fuld, Wiley, 1988).

Auditing is a relatively simple process, and you do not have to do it all at once. Take on one department or one regional office at a time. Enter the information onto a simple data base management program, such as Dbase, Paradox, or any number of similar programs.

Track Target's Operations Through U.S. Locations
When an overseas, multi-national company conducts business in the United States it leaves information trails. By just following the prime intelligence rule, "Wherever money is exchanged so is information" you can follow your target's informational bread crumbs if it:

• Enters the U.S. and begins promoting its products or services in the business press;

• Researches the U.S. market and begins to contact trade associations, advertising agencies and market research houses;

• Needs to hire personnel, through placement of notices in help wanted ads, with head hunters, and university recruitment offices;

• Establishes supplier and distributor relationships;

• Exports or Imports products to or from the United States and the shipping manifests are reported on by firms, such as PIERS.

U.S. Government
As you have seen in other chapters, the federal government has a number of agencies whose job it is to monitor international companies. Government reports and the analysts that produce them, can offer you worldwide industry commodity and country-specific information, as well as some critical analysis. They can also provide valuable background information on international markets, culture and governments.

U.S. Securities and Exchange Commission (SEC)-- Public Reference Room: The SEC maintains company filings, annual reports, and other communications with stockholders of non-U.S. corporations doing business in the U.S. If companies trade stock, they must file documents with the SEC.

International Trade Administration (ITA) : The ITA researches and investigates the impact of imports on U.S. commerce. Although the Commission does not investigate individual companies per se, it does look at a wide variety of industries, commodities and countries. You can write for a list of reports or call the ITA analyst assigned to your industry to find out what studies have been done. If your industry has been investigated, there might be information on your target company, but you will have to go in person to the ITA in Washington to review the investigation reports.

The ITA also carries out competitive investigations for particular industries to see how competitive U.S. companies are in a particular industry; these cases are called "#332" cases. The Unfair Import Investigations Division hears and investigates cases that involve patent infringement and unfair trade practices. These cases are called "#337" cases.

The ITA publishes The Pros and Cons of Entering into Negotiation on Free Trade Area Agreements with Taiwan, the Republic of Korea, and ASEAN, or the Pacific Rim Region in General.

International Trade Administration (U.S. Dept. of Commerce): The focus of reports at the ITA is on industry and country, not company-specific information. The ITQA, through their U.S. and Foreign Commercial Service (US&FCS), provides a worldwide network of services and publications on international market trade. These trade specialists, located throughout the world, maintain market-related information.

Domestic offices provide assistance to exporters with everything from trade exhibitions and free legal counseling to finding an international banker and freight forwarder. District Export Councils, comprised of experienced American exporters, conduct seminars and counsel exporters on international trade. ITA Country Desks include:

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