Ethics in the Competitive Intelligence Industry
Competitive Intelligence (CI) can be defined as coordinated research of an organization’s competition within a specific industry. CI assesses those who compete for market share and attempts to guess the actions of competitors before those actions are introduced in the marketplace. The vision of Strategic and Competitive Intelligence Professionals (SCIP) is, “Better decisions through competitive intelligence” (Vision & Mission, n.d. para. 1). SCIP’s mission, in part is to, “be the global organization of choice for professionals engaged in competitive intelligence and related disciplines” (Vision & Mission, n.d. para. 2). Competitive intelligence, as provided by companies like SCIP, could be particularly important for a large organization contemplating a major product change or price increase. A good example of such a company that would have benefitted tremendously from such CI is Netflix. As you probably know, Netflix is a provider of movie rentals and rents its movies worldwide to customers through distribution of DVDs via the mail and via online streaming. In October 2010, Netflix’s executives announced that they had decided to split these services into two separate product lines and that their customers would have to choose one type of service over another. Coupled with news of a major price increase, the company lost over 800,000 customers in one month and, as a result, decided not to force its customers to choose between either DVD rentals or online streaming. “Netflix prides itself on its analytical, data-driven approach to making decisions. But it made a classic business misstep. In its reliance on data and long-term strategy, the company underestimated the unquantifiable emotions of subscribers who still want those little red envelopes” (Wingfield & Stetler, 2011, para. 7). Netflix’s CEO, Reed Hastings, quizzed a friend about the planned product split and the friend told him not to go through...
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