Trendsetters Recognize the Value of Competitor Information
According to recent research from PricewaterhouseCoopers Trendsetter Barometer, 31% of fast-growth CEOs report that business information about major competitors is more important today than it was a year ago. Another 65% rate it as having equal importance, and only 4% say it is somewhat less important. Moreover, companies that put a premium on competitor information outperform their peers on key performance measures, including sustained revenue growth and gross margins. At the top of their want-to-know list: changes in pricing, new product initiatives, and changes in corporate strategy. Operating information was also of high importance for those that rated competitor information as very or critically important.
The study consisted of interviews with CEOs of 407 products and services companies identified in the media as the fastest-growing U.S. businesses over the last five years.
Virtually all of the CEOs surveyed (84%) see competitor information as important to profit growth of their company; 42% see it as very or critically important, and another 42% see it as somewhat important.
Over the past 12 months, CEOs characterized as trendsetters and that rate competitor information as very or critically important grew faster14.2% revenue growth, versus 11.8% for others. These same advocates of competitor information expect even better results and faster revenue growth over the coming 12 months: 16.9%, versus 13.3% for others.
Steve Hamm, managing partner of PricewaterhouseCoopers middle-market advisory services, cites additional information which indicates that trendsetter companies whose CEOs rate competitor information as very or critically important are more dynamic than the other fast-growing companies in several ways:
The three most valuable types of competitor information [pricing changes, new product initiatives, and changes in corporate strategy] are time sensitive, noted Hamm. With some advance notice, they can be used to shape a counter-approach.
Eighty-two percent of the trendsetter companies report relying on their field
sales force for at least some of their competitor information. Searches of
published sources and involvement in trade associations were cited by 76%
and 75% of respondents. Information from competitors former key employees
(51%), industry analysts (49%), and market research among customers of competitors
(49%) is also used. Only 11% of respondents seek information from public officials.
Fifteen percent of fast-growth CEOs employ one or more outside consultants to help collect competitive information. Even among those that rate competitive business information highly, only 20% seek the help of outside contractors. When used, these outside resources typically provide 33.7% of key information gathered, which may indicate that they play an important but complementary role.
More information is available from www.barometersurveys.com.
The CPA Journal is broadly recognized as an outstanding, technical-refereed publication aimed at public practitioners, management, educators, and other accounting professionals. It is edited by CPAs for CPAs. Our goal is to provide CPAs and other accounting professionals with the information and news to enable them to be successful accountants, managers, and executives in today's practice environments.
©2002 CPA Journal. Legal Notices
Visit the new cpajournal.com.