Friday, October 29, 2010

CI insights are actionable, relevant, external

Note: The following post is taken from my new book, Competitive Intelligence: Improving Law Firm Strategy and Decision Making. You can learn more about the book here.

If you have spent any time studying or developing CI, you will have noticed that experienced CI practitioners spend more time discussing analysis than any other component of the intelligence cycle.

While all steps of the cycle are equally important and mutually dependent, analysis turns what all firms have -- information -- into actionable insights that are uniquely relevant to your firm. If you follow all other steps in the intelligence cycle, but skip the analysis, the best your firm can hope for is to be on par with the majority of its competitors, rather than enjoying a competitive advantage.

So, what do we mean by analysis? Simply put, CI analysis is the process of drawing actionable, relevant insights from external information. All the adjectives in this definition are instructive, and you should keep them in mind as you plan and do your analysis.

Actionable - Information on its own is benign and only becomes actionable through analysis. For example, a client dossier or competitor profile that doesn't identify the opportunity for your firm to act is just static data, not intelligence. In addition, "actionable" means "forward-looking." If your firm is going to take actions in the future, your analysis has to provide insights about the future environment, e.g., new cross-selling opportunities, an emerging overseas market or the strategic direction of a potential merger partner.

It must also be said that the same information can be converted, through analysis, into different intelligence for two different firms in different circumstances that are evaluating different decision options.

Relevant - "Relevance" is closely related to "actionable" and means that as you plan and deliver your intelligence you understand the context in which the intelligence will be used, including which actions your firm can conceivably take. For instance, the identification of a potential new overseas location would be neither relevant nor actionable if your firm has just had its worst year on record, has no available funds for expansion and is losing key partners. Likewise, an analysis of new opportunities in commercial real estate work is unlikely to be either relevant to your firm's needs or actionable if the firm has just declared growth of its litigation practice to be the firm's top priority.

Obviously, the information you gather and analyze must be brightly relevant to the decisions at hand, not merely easy to obtain. Too often law firm CI practitioners rely overmuch on secondary information developed by information aggregators who sell the same information to all competitors. Too seldom, firms seek out primary sources with information your competitors do not yet have. For example, primary sources (clients, industry experts and others) can provide attitudinal opinion information (about changing needs, satisfaction, loyalty) and behavioral information (about hiring and spending behaviors, attendance, etc.). You can obtain primary information through interviews or by simply observing the marketplace.

Relevance also applies to timing the delivery of your intelligence. For example, if you were to provide one of your firm's partners with an analysis of potential cross-selling opportunities at Client X one week after that partner had pitched a different set of services to Client X, you are unlikely to get much of a response from the partner, at least not a positive one.

External - While you certainly must understand the internal dynamics of your firm to be able to provide relevant intelligence, your analysis should focus only on factors outside the firm. Law firms are notoriously introspective, so CI should be the objective voice of the external environment inside your firm. More to the point, a law firm's opportunities only take place outside the firm; inside the firm there are only costs.

Wednesday, October 27, 2010

New law firm CI book published

As many of you know, I've recently written a book about law firm CI. It has now been published in the UK by the Ark Group / Managing Partner magazine.

My book is titled Competitive Intelligence: Improving Law Firm Strategy and Decision Making. You can learn more about the book and download sample sections here. You can also purchase it here.

This book is aimed at a broad audience -- partners and senior managers of law firms, CI practitioners and othes inside or outside law firms who want to understand how to apply CI in a law firm setting.

It takes a highly practical look at how CI is applied in firms. It also addresses how CI in the legal industry is similar to and distinct from CI in other industries, the challenges peculiar to law firms, typical law firm key intelligence topics and assignments, and more.

This report will surprise some readers when it describes how some firms are already executing the full range of CI activities as that discipline is practiced in the corporate world. As with other business disciplines once considered "not for law firms," the full spectrum of CI activities, legally and ethically executed, is rapidly being accepted by more law firm leaders.

The greatest demand in law firm CI these days is for sophisticated analysts with strong legal industry knowledge, business savvy and broad analytical skills. Without their eventual contributions, CI in law firms will not advance beyond information gathering, which, although useful, cannot offer decision makers the fuller benefits of actionable intelligence.

Whether your firm already has informal CI in-house capabilities and wants to upgrade them, wishes to engage the services of external CI consultants or hopes to learn how to utilize its existing CI resources to become more competitive, this book will help you decide where you should start.

Please check it out.

Monday, October 25, 2010

Social psychology and alpha lawyers

The ABA Journal today blogged about a recently published social psychology experiment that found the apparent dominance / maturity of law firms' managing partners' faces (as rated by college students, the usual social science lab rats) correlated slightly (14%) with the managing partners' respective firms' profitability levels.

For a limited time you can download the study report here.

Even though I am a social scientist myself, I have a hard time interpreting this not-yet-replicated study as anything other than entertaining silliness. However, given that neither lawyers nor marketers are renowned for their statistical savvy (otherwise, they'd have become accountants and physicists), I'm a little worried about what some might do with this new-found information.

Below is an animated movie (created with my new favorite online toy, xtranormal) to illustrate the dangers of leaping into action after reading a headline that says, "Recent research finds that ...."

Say what?

I'm blogging again, thanks to Russell Lawson who emailed me and said, "Just do it." The following is the first in a series of posts on the topic of analysis -- that much too mysterious process that converts information into intelligence.

Last week, as often happens, I was on an airplane. I was seated next to a nice man, an intelligent man.

Early in the flight during light conversation, he proffered the news that young people are spending too much time looking at computer screens instead of books and that their brains are being rewired in new ways. Studies were proving this to be true, he said.

"Oh," I said, "What do the studies say is happening to their brains?"

"I don't know," he responded, "but it can't be good."

Several hours later, he offered me more information. "I read an article recently that said 80% of Americans did not read a single book last year."

"Wow," I said. "How many Americans used to read one or more books a year?"

He frowned and said, "I don't know."

The above anecdote suggests an autumn meditation for law firm CI practitioners and their clients: What would improve your own firm's decision making -- more information or more analysis?