How Covid-19 Has Changed How We Use Corporate Intelligence

This article was originally published in Business Leader.

During the pandemic, ‘agility’ and ‘resilience’ have become the watchwords of business leaders. This has thrown greater light on the importance, and impact, of corporate intelligence.

The development of more open-source intelligence (or ‘OSINT’) techniques has led to an acceleration in the speed and availability of intelligence. This has made corporate intelligence an indispensable tool for any business that wants to pivot quickly when the unforeseen arises, developing overall resilience. While there is still an important role for human intelligence (or ‘HUMINT’) to play, it tends to favour long-term strategies and business developments. But whatever combination of approach best fits a specific case, good corporate intelligence can help business leaders to make more informed decisions, enabling timely interventions that can make a critical difference.

‘Just in time’ loses ground to ‘just in case’

Some of the biggest victims of the ongoing disruption of the pandemic have been the automotive, electronics, and FMCG industries. These notably tend to use a ‘just in time’ approach to supply chain operations. While this model has the advantage of reducing the working capital needs of a business, it also depends heavily on a reliable supply of resources and components.

"The pandemic has very much highlighted the trend for ‘slow-balisation’, with some indications that globalisation is actually going into reverse."

This has led many to question whether a partial shift back to ‘just in case’ behaviours, whereby manufacturers keep more inventory in order to smooth supply for end users and maintain steady production, is a more optimal approach. However, businesses are still reluctant to do this without good reason, as in most cases it can be costly and hurts profitability. But considering the potential long-term cost and damage of the disruption caused by interruptions to ‘just in time’ operations, it is likely that many companies will allow more flexibility going forward. For example, in 2021 sales of new cars in the UK for the month of October plunged 25% year-on-year, with the shortage in semiconductor components taking most of the blame. As delivery dates for new cars have stretched further into the future, prices for second-hand cars have reached unprecedented levels. A partial pendulum swing back towards ‘just in case’ could include allowing for an increase in the limit of stock or inventory that can be held, if certain risk indicators rise past a certain point. Finding that balance requires more timely information on threats and externalities that could disrupt the supply chain.

The pandemic has very much highlighted the trend for ‘slow-balisation’, with some indications that globalisation is actually going into reverse. With this shift comes a greater importance in navigating national differences – cultural, political, economic, legal, and regulatory (to name just a few aspects). This means that businesses operating in, or trading with, other countries need to have a heightened awareness of local trends and issues. Management teams will need to pay greater attention to these ‘externalities’ than before.

As we can likely expect rolling national lockdowns to be a key policy tool of governments worldwide in 2022, we can anticipate that corporate intelligence will continue to support a partial shift towards ‘just in case’ supply chain operations. Timely ‘horizon scanning’ for both direct threats and other externalities that may impact your business are key to making an agile approach work. Ultimately, this helps a business move from a reactive to a proactive approach which allows them to anticipate and prepare for events which may disrupt operations.

Dealing in uncertainty

As part and parcel of this economic instability and the start to recovery, M&A activity is back on the rise. In fact, PwC has found that 76% of CEOs expect global economic growth to improve in the next 12 months. This cautious optimism is likely to lead to pent up demand being released, as management teams focus on the acquisitions likely to support post-pandemic growth. Inevitably, some of the activity will have occurred through hostile takeover attempts. Whether an economic winner or loser from the past eighteen months, businesses may find themselves being targeted for acquisition.

In a more uncertain and fast-moving M&A market, having ongoing insight into the behaviours of key stakeholders and potential ‘enemies’ is key. While human intelligence strategies such as in-depth investor interviews will no doubt continue to play a role, many businesses have started to invest in other ways to keep their ears to the ground.

 

"Combining the in-depth insight of human intelligence with the speed and accessibility of open-source intelligence will be vital for any business that needs to navigate the complex and nuanced aspects of the current marketplace"

Targeted OSINT techniques are being increasingly used to put a ‘watching remit’ on key stakeholders. Automated intelligence gathering, expertly analysed, can provide a timely warning if an investor’s behaviours start to deviate from the opinions they presented in the most recent earnings call, for example. This can be especially valuable, if the stakeholder is a key player that a would-be acquirer needs to sway.

As the world of business itself increasingly blends digital and real-world communications, so too do corporate intelligence techniques need to be combined into a holistic strategy. Combining the in-depth insight of human intelligence with the speed and accessibility of open-source intelligence will be vital for any business that needs to navigate the complex and nuanced aspects of the current marketplace.

Corporate intelligence becomes an ongoing risk management tool

In addition to the use of corporate intelligence to safeguard operations and business stability during the pandemic, there has also been a rise in companies using OSINT techniques to safeguard their reputations. While the rise of digital access to information has no doubt democratised corporate intelligence, it has also massively widened the group of stakeholders that a business needs to monitor and engage with. These can range from activists using online maps to expose corporate wrongdoing, to disgruntled ex-employees sharing incorrect information on social media. Any of these can prompt an intelligence alert.

"After the disruption of the Covid-19 pandemic, many businesses are waking up to the fact that they need to move from a reactive to a proactive use of corporate intelligence"

The key here is to introduce the correct processes and techniques that quickly refine down a large quantity of information to define what is contextually relevant and will deliver actionable insight for an individual business. Without this, management teams can suffer from ‘analysis paralysis’ and feel confused rather than directed by corporate intelligence. However, with the correct ‘filters’ on intelligence in place, such an approach allows a business to detect early warning signs and start proactively managing an issue sooner.

After the disruption of the Covid-19 pandemic, many businesses are waking up to the fact that they need to move from a reactive to a proactive use of corporate intelligence. While the techniques themselves are constantly evolving to keep up with the new technologies and communications platforms constantly emerging, what has really changed in the past eighteen months is how corporate intelligence is being used. As we move into a ‘new normal’ that arguably is not entirely like the world we knew before, continually adapting our application of corporate intelligence will be a defining factor of how businesses build resilience.

Application through insight

So, what does that correct application look and feel like? Corporate intelligence needs to be seen through the lenses of relevance, context, and insight. This is vital to ensure businesses are focusing on the right issues and can understand them more fully. Good corporate intelligence which follows these principles helps leaders to make informed business decisions, which ultimately build resiliency. The Covid pandemic has been the proof and the test of this maxim.