Page 26 - DMGT401Business Environment

Unit 1: Indian Business Environment

Corporate Intelligence: Corporate Intelligence (CI) can be described "as a technique of adopting Notes
industry/research expertise to analyse the information available on competition from public
sources and to draw conclusion based on this data." A typical CI activity involves collection,
organization, analysis and utilisation of business-related data of competitors to make informed
decisions.

Example: Some of the major companies that use CI include: Microsoft, Motorola, P&G,
HP, GE, IBM and Xerox.
Spying: Corporate espionage can be defined as 'spying' on business competitors to acquire
proprietary information such as product design, research projects, marketing plan, trade secret,
source code for new software, intellectual property and research information and other business
strategies. In 1996 the US government passed the Economic Espionage Act to restrict espionage.

Did u know? Once GM alleged that Volkswagen stole its trade secret by luring its head of
production. GM won case against Volkswagen and obtained a hefty compensation.
Similarly, in 1943, a P&G employee reportedly bribed an employee of Levers Brothers to steal
a bar of soap that was under development.

Deciding Priorities

Various changes take place in the environment and it is difficult, cumbersome and a costly affair
to keep a regular eye on every aspect of these changes. So it is essential for a strategist to rate the
environmental factors on the basis of criticality and then invest time and resources in
environmental analysis. The Nine-cell Matrix is one method of deciding priorities regarding
environmental issues.
The issues that are critical need maximum attention of the management and quick action or
preparation. On the other hand issues of low priority need just monitoring at regular intervals.
Issues of high priority need attention standby plans in case and also need regular observation.

Figure 1.3: Identifying High Priority Environmental Sector

Probability of Actions Critical High Priority Low Priority High
High
Medium
Low

Low Priority
High Priority
High Priority
Medium
Low Priority
To be Watched Low Priority
Low
Methods Environmental Analysis

Environmental Analysis can be divided into two methods
1. Environmental Evolution: There are three components that are useful to describe changes
in the environmental segments:
(a) Type of change

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