Competitive intelligence in China: in decline?
Aqute does not have many Chinese clients. We have attributed that to the catch-all 'cultural differences', or the fact that Chinese companies may see their competitors as being other Chinese companies, in which case why ask a non-Chinese agency to do the analysis.
This recent paper sheds some light on how Chinese companies think about competitive intelligence. From the very beginnings:
In 1980 Xianpei Yuan (Changhuo Bao et al., 2005) published the paper “The Difference and Correlation Between Intelligence and Information”, published in No.1, of the Science and Technology Information Service. This was the first time intelligence appeared in Chinese academic journals.
Key dates include 1994, when the Society of Competitive Intelligence was founded, and 2002 when Baidu launched the first competitive intelligence software.
The late 1990s saw some of the first competitive intelligence companies appear:
At the end of the 20th century a number of Chinese information companies such as Xuanxin CO. Ltd. and Menglong CO. Ltd. tried to develop CI software, but their products were only used by themselves and their customers as an accessory to CI consultation. These attempts did not lead to any great response. Then Baidu, a famous IT company in China and abroad, launched the CI software product eCIS on the Chinese market. This caused a strong reaction to CI and had a major effects. Following Baidu, many companies entered the CI market. At the same time Autonomy, a British search giant, entered the Chinese CI market.
After a short-lived prosperity, in 2006 many CI software companies such as Baidu Co. Ltd. and Tianxiahulian Co. Ltd. dropped out of CI software market. In the meantime people began to cast doubt on CI performance. Chunfeng Wang (Chunfeng Wang, 2006) published online the article “Is Competitive Intelligence the emperor’s new clothes?”. These signals hinted to the instability of the CI market in China. In 2008 CI software developers moved to other industries, switched to other IT business sectors or went silent. Former CI websites such as Huanmen.com and Zoomchina.com were closed. But there were also new CI websites appearing such as chinacir.com.cn and zitview.com.
Chinese thinking around what should drive competitive intelligence has also evolved. In the early days, competitive intelligence was seen as an extension of government activity and likened to JETRO, which some people see as conducting government-driven competitive intelligence:
In early 1989 Qihao Liao and Zuozhi Zhang (Qihao Liao et al., 1989) wrote the paper, “Anatomy of JETRO’s Overseas Technological Intelligence Activities”. It claimed that JETRO’s overseas intelligence activities were a state version of competitive intelligence. The concept of state run competitive intelligence or national competitive intelligence then appeared in the literature. In 2002 Liao held a speech about this topic at the SCIC annual conference. From 2004 Gang Zhao (Gang Zhao, 2004) wrote several papers about this topic to advocate competitive intelligence at a national level.
As Chinese companies gained more market freedoms, competitive intelligence has migrated from a government discipline to one where businesses are the main actors:
With rapid development of a global economic integration, industrial clusters have become an economic entity that governments actively cultivate. In 2008 the China Institute of Science and Technology Information set industry competitive intelligence as one of their research directions. For 3 years Feng Chen (Yanning Zheng et al., 2009) has been guiding colleagues and students in how to study its meaning, scope and characteristics.
Overall, the authors think competitive intelligence in China is in decline:
We think the basic reason for this is that in China CI still do not play an important role for the economic development and strategy support. The scale of CI practices is limited and still underdeveloped. The support and attention given to this area from the government is not sufficient. Government guidance is important for any task in a country such as China, with a strong collectivist tradition.
Analytical methods and technologies used for CI is mainly introduced in China from abroad, and has been lacking in innovation. It seems method and technology is the weak point of CI research. Strengthening CI innovation in this aspect is key to developing CI as a science for academics around the world, maybe especially in China.
The CI market in China is facing a period of decline. The situation is not clearly optimistic. We think the basic reason is that the value of CI has not been developed in depth. As a consequence people don’t know enough about CI and even doubt its value.
A negative summary.