When done well, the Competitive Intelligence (CI) function helps companies make better decisions, anticipate threats, plan effectively in a rapidly changing market, and avoid corporate risk. But the non-traditional CI function is often undervalued in corporations, and CI leaders can find themselves struggling for attention and resources. This report includes the findings from benchmarking the Competitive Intelligence function at 32 companies in the bio-pharmaceutical industry. It includes metrics and insights that CI leaders can use to evaluate their functions, increase the value of deliverables, and generate greater influence among their stakeholders. Included in the report are benchmarks for the size, cost, scope, structure, tools, activities, and best practices that drive effectiveness in high-performing CI organizations. This report also identifies 10 Hallmarks of Competitive Intelligence Excellence and presents insights from interviews with veteran CI leaders on how to evolve the CI role from data gathering to providing strategic advice to decision makers. Best Practices, LLC conducted this study to identify best practices and innovative methods for improving the strategic role and impact of the Competitive Intelligence function within the pharmaceutical and related industries. The study provides health care industry and CI leaders with metrics and insights they can use to increase the value of their function and generate greater influence within the corporation.

1. How Successful Companies Create and
Develop a High-Value CI Function to Drive
Better Business Decisions
Best Practices, LLC
Strategic Benchmarking Research
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2. Table of Contents

Executive Summary





Research Objectives & Methodology
Participating Companies
Key Findings & Insights
Hallmarks of Excellence in Competitive Intelligence
Section 1: Key CI Sources, Activities & Deliverables
1A. Sources
1B. Activities & Deliverables

Section 2: Use of Third Party CI Vendors

Section 3: CI Resources, Structure & Operations, Functional Evolution
3A. Resources
3B. Structure & Operations
3C. Functional Evolution & Influence

Section 4: Best Practices & Lessons Learned
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3. Research Project Objectives & Methodology
Best Practices, LLC conducted this benchmarking study to identify best practices and innovative
methods for improving the strategic role and impact of the Competitive Intelligence function within
the pharmaceutical and related industries.
Research
Objectives
 Provide healthcare industry leaders
with metrics and insights they can
use to evaluate and compare the
performance of their Competitive
Intelligence organizations.
 Develop findings & insights CI leaders
can use to increase the value of their
function and generate greater influence
within the corporation.
Research
Methodology
 Best Practices, LLC engaged 35
Competitive Intelligence leaders from 32
companies in the healthcare industry to
participate in this benchmarking study.
 Research analysts also conducted six
deep-dive executive interviews with
selected benchmark participants.
Topics Covered
 Sources & Activities
- Key primary & secondary research activities
- When to use primary sources
- CI source effectiveness
- CI from social media & internal employees
- Most effective activities
- Percentage of work that is analysis
 Budget & FTE Levels
 Uses of Third Party Vendors
 Top 5 CI Employee Skills
 CI Evolution & Trends
 Structure & Leadership
 Best Practices & Lessons Learned
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4. 35 CI Leaders Participated in the CI Benchmarking Research
Thirty-five Competitive Intelligence leaders from 32 companies in the healthcare industry
participated in this benchmarking study. Participants represented small, midcap and large
biopharmaceutical and medical device companies. Seventy percent work in U.S. locations.
Participating Companies: Benchmark Class
Abbott Nutrition, Amgen, AstraZeneca, Ariad, Bayer, Biocon, Boehringer Ingelheim, B Braun, Covidien, Daiichi-Sankyo,
Dentsply, EMD Serono, Emergent, Ethicon, Ferring, GSK, Glenmark, Janssen, Jazz, Johnson & Johnson, McKesson,
Medtronic, Merck, Novo Nordisk, Pfizer, Purdue, Sanofi Pasteur, Teva, Torrent, Upsher-Smith, Waters, Wyeth Nutrition/Nestle
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5. Key Findings & Insights (1 of 6 pages)
The following key findings and insights emerged from this study.
CI Functional Value Is Not Universally Recognized
CI is not yet seen as a traditional corporate function, such as Finance or Sales, and, as such, the value of the function
remains poorly understood by senior leadership. CI continues to be subject to a periodic ebb and flow of corporate
resources, as the perceived value of the function changes within individual organizations. Interviewed Competitive
Intelligence leaders agreed that the constant flux makes it difficult to maintain lasting relationships and generate influence.
Results of Pharma
CI Studies by Best
Practices, LLC:
CI Is Becoming More Decentralized
This research observed a continuing decline in the presence of centralized CI
groups over the past dozen years. Embedding CI within other functions (44%),
leads to emergence of shadow resources, work fragmentation, and lost opportunity
to leverage company size when purchasing services. Only 18% of participants
represent centralized, dedicated CI groups serving the entire company compared
with up to 85% in past Best Practices, LLC studies of pharma CI.
Year
%
Centralized
2001
85%
2007
67%
2010
31%
2013
18%
Use of Advisory Boards to Collect CI Is Shrinking
The use of Ad Boards is down significantly from previous BPLLC studies, where as many as 90% of respondents engaged
them to gather intelligence. In this study, only 52% collect intelligence from advisory boards, and only 21% find them highly
effective for primary research.
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6. Hallmarks of Excellence in Competitive Intelligence
Ten key hallmarks of excellence were observed in CI programs at participating companies.
10. Grow the function by
providing quality deliverables
that create demand
9. Measure results to
show that CI function
can ‘move the needle’
8. Engage internal
clients in a continuous
feedback loop
1. Build strong
relationships with a
few key customers
Competitive
Intelligence
Excellence
7. Reduce risk by engaging
Legal in developing
polices & processes
2. Focus on top decision
makers and understand
their issues
3. Hire staff with past
experience involving
outcomes responsibility
4. Choose questions (KITs)
that are of a strategic rather
than tactical nature
5. Provide relevant, forwardlooking deliverables with
analysis & recommendations
6. Exhaust secondary
resources before engaging
in primary research
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7. KOLs Seen as Most Effective Primary Research Source (1 of 2)
Two-thirds of participants rate Key Opinion Leaders/ industry experts as a highly effective primary
source for collecting CI, and another 17% find this source somewhat effective. Although clinical
investigators are less used for intelligence, 60% who use them rate them highly effective as well.
Q. Please indicate the effectiveness of each of the following sources your company uses for primary CI research.
[Choose the best option for each primary source type.]
Primary Research Source Effectiveness
Highly Effective
Somewhat Effective
Industry experts (e.g., KOLs)
Primary CI research vendor
Not Effective
66%
45%
Investor analysts
38%
Medical Congresses
Internal Employees
31%
Internet/Online
28%
24% 7%
(n=29)
3%
17%
31%
17%
45% 3%
31%
Clinical trial investigators for competitive products
17% 14%
3%
34%
34%
Not Used
59%
21%
10%
48%
59%
3%10%
% Responses
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8. Primary Research Accounts for More than 1/3 of CI Activity
While the bulk of intelligence gathering requires secondary research, 38% of CI activity across the
benchmark class involves primary research. CI groups typically turn to primary sources and vendors
for access or when secondary resources have been exhausted and a question remains unanswered.
Q. Approximately what percentage of your intelligence gathering work involves primary (field) research and what percentage
involves secondary (desk) research? [Total should equal 100%]
Primary vs. Secondary Research Activities
%
Intelligence
gathering
from primary
research,
38%
%
Intelligence
gathering
from
secondary
research,
62%
(n=35)
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9. Developing Insights/Recommendations Takes Brains & ‘Guts’
Creativity, guts, brains, and a ‘’sixth sense” are attributes CI people need to take their findings from
reporting to delivering insights and recommendations.
Q. What does it take for a CI person to be able to develop insights and make recommendations?
“It takes creativity. The ability to step outside your own seat and your own job function and think about it from another person’s
point of view—typically from another company’s point of view.” – Company A
“At some point it’s just a matter of guts. You have to be willing to be wrong before you can be right. You have to be willing to
put a stake in the ground and understand that sometimes you’re going to be wrong and that’s OK.” – Company A
“Hire smarter people. They have to be smart enough on day one to think
things through. The difference I see in CI staff who can deliver insights
and who cannot has everything to do with the individual staff and how they
are wired. It’s not an issue of training. Not everybody can learn it. You
have to grow/foster confidence.” – Company A
“They have to have the ability to understand the question, the implications,
the impact on the business, and then orchestrate the steps of the intelligence
process.” – Company E
“It’s about experience, and context, and having that sixth sense of things
because you've been involved in this activity for a period of time.”
– Company B
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10. Profiling Is Top-Ranked Activity for Creating Actionable Insights
Forty percent of benchmark participants listed profiling among their top three CI activities for
producing actionable insights and influencing business decisions. Competitor, portfolio, and
product profiling were all mentioned.
Q. Overall, what three CI activities conducted by your group and/or your vendors most often produce actionable insights that
can influence business decisions? [List your Top 3 activities. You may include activities beyond those listed.)
Top 3 Most Influential CI Activities
Profiling
40%
News Updates / Alerts/ Warnings
33%
SWOT Analysis
30%
Tracking, Mapping, Monitoring, Other
30%
Primary Research
27%
Clinical trial monitoring
23%
War games/ Scenario Planning
23%
Conferences
23%
Market audits
(n=35)
Note: Survey
participants
indicated a high
value for
monthly/periodic
reports and a
much lower value
for daily updates.
13%
% Responses
“Head towards the hot spots - seek out where you can be most impactful”
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11. Percent of Companies Ranking Each Skill Among Top 5
This table shows which CI skills benchmark participants selected among their top five most important
and the relative rank they assigned to each. Critical thinking was far in front with 44% ranking it #1 and
83% including it in the top five.
Q. Which 5 of the following employee competencies are most important for delivering maximum value CI performance?
[Choose only 5, placing your choices from top to bottom of list in order of their importance]
Rank
Critical
thinking
Communication/ Industry
presentation
experience
Intelligence
Competitor
source
profiling
identification
Database/
Internet
searching
skills
Product
Networking
knowledge
#1
#2
#3
#4
#5
44%
17%
11%
8%
3%
14%
11%
6%
14%
22%
11%
14%
8%
6%
3%
11%
8%
11%
3%
6%
3%
8%
14%
8%
8%
3%
3%
8%
8%
8%
3%
6%
6%
8%
8%
3%
3%
0%
11%
11%
Total
83%
67%
42%
39%
42%
31%
31%
28%
Rank
Interviewing
Company
knowledge
Data
synthesis
Scenario
development
Project
& planning management
/war-gaming
Portfolio
analysis
Financial
analysis
Pattern
recognition
#1
#2
#3
#4
#5
(n=36)
3%
0%
0%
6%
3%
3%
3%
0%
3%
0%
0%
25%
22%
11%
0%
0%
0%
3%
8%
11%
0%
0%
6%
3%
6%
0%
3%
0%
0%
6%
0%
0%
6%
0%
0%
0%
0%
0%
0%
0%
Total
11%
8%
58%
22%
14%
8%
6%
0%
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12. Building CI Capabilities & Value Starts with Client Relationship
A veteran CI leader shared basic steps for growing capabilities and value in a small or fledgling
Competitive Intelligence organization. The steps emphasize building close relationships with a few
key customers and collecting feedback on the financial impact of the CI contribution.
Steps for Building CI Capabilities & Value
 Have a January 1 appointment on the
calendar of your primary customer or
customers.
 Know their businesses well before you
walk in.
 Start a conversation about:
 Which of their objectives need
intelligence support to help make a
better decision?
 What decision needs to be made in
what timetable?
 How critical is it to the growth of the
company, or at least at producing
revenue or reducing cost?
 Be able to directly link CI to an increase
in revenue, a decrease in costs, or an
opportunity cost that is avoided.
Use feedback to improve CI services
To close the loop, get client feedback—
immediately not at the end of the year
Delivering intelligence back to customer
Supplement with primary interviewing
if necessary to support analysis
Execute the secondary research
Establish plan for fulfilling KITs
“It’s critical these days is to be able to say
the intelligence gathering program can
move the needle. If it can be measured and
attributed to CI input, that’s what gets
people recognized for value. Especially if
it’s a small, start-up group.” – Company E
Work with client to define KITs
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13. About Best Practices, LLC
Best Practices, LLC is a research and consulting firm that conducts work based on the simple yet
profound principle that organizations can chart a course to superior economic performance by studying
the best business practices, operating tactics, and winning strategies of world-class companies.
Best Practices, LLC
6350 Quadrangle Drive, Suite 200
Chapel Hill, NC 27517
www.best-in-class.com
919-403-0251
best@best-in-class.com
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BEST PRACTICES,
®
LLC