“One Intelligence. The Elevator talks to MD Yannick Poivey about what it could do for your business.”

One Intelligence managing director Yannick Poivey is interviewed by quarterly review The Elevator (www.the-elevator.com) – Summer 2010 – Article PDF

Question:
To the untrained ear, business intelligence sounds like something involving secret agents and spying to accrue business acumen. In reality this isn’t the case – but what are the key points to understanding business intelligence ?

Answer:
Business Intelligence is a process through which an economic operator will gather and analyse information that is essential to his business interests. Of course, this process applies to corporations but not only. Indeed, law firms too, banks, investment funds and even high net worth individuals might be confronted at some point to issues where critical information is badly needed. We are obviously not talking about Google information, but intelligence that can be obtained essentially through interviews and various investigative techniques – I’ll come back to that point later on.

Let me give you some examples: let’s say that a company is in the process of signing a distribution contract with a local conglomerate in a Middle East country. However, it has come to the management’s ears that a branch of this conglomerate was already working for one of their key competitors. The company decided to launch a Business Intelligence assignment with the purpose of investigating the alleged conflict of interest. In such a case, Business Intelligence is understood as a tool that will prevent the company from making the wrong move and help make an informed decision. This is basically a risk-management tool.

Question:
The process seems to involve quite a lot of time and in depth study of a firm to ascertain exactly what is going on under the surface. What are the key stages of Business Intelligence?

Answer:
Business Intelligence is not a concept but a discipline that is supported by a well-defined methodology. To us, Business Intelligence consists of collecting and analysing hard-to-find business information for a well-defined purpose. Therefore, screening the Internet and reading press archives is not sufficient. A first methodological step consists of reviewing all the information that is publicly available. This should not be mistaken for on-line information: local courts, registries of commerce, real estate registers and other public offices provide a wealth of information on paper. You just have to know where to look. It is common sense to say that a lot of key information is stored in the minds of human beings and not aggregated in electronic or paper format. Finding smart and collaborative ways to talk to interlocutors allows for fruitful information exchange.

Question:
While companies streamline due to the economic downturn and struggle to find ways to cut costs, how essential is business intelligence to a successful corporation?

Answer:
It is often stated, but hard to prove, that corporations which invest substantially in Business Intelligence sustain higher growth levels than companies that don’t. I am convinced that Business Intelligence offers attractive returns on investment, but the nature of those returns depends on your business activity.

Let me take the example of a manufacturing company: Business Intelligence, or more specifically Competitive Intelligence, is a formidable tool in order to anticipate the competitors’ projects and strategy. Also, risks associated with a new business partner or an acquisition can be minimized through a proper assessment of the partner’s reputation and integrity. Along the same lines, a venture capital or private equity firm will take advantage of Business Intelligence in order to assess the weaknesses of a prospective portfolio company. What is the senior management’s reputation and track record? What are their main failures and achievements? How is the target company perceived by suppliers, competitors, clients…? Business Intelligence will provide answers. In the case of private banks – a well-known product of Switzerland, investigating the profile of a prospective client from a risky country is part of the usual compliance practices. Business Intelligence contributes to developing a comprehensive view of the potential client’s reputation and sources of income, and will help the bank assess properly the level of risk associated with a wealthy prospect. Finally, law firms gain a competitive edge over the opposite party by using Business Intelligence. Gathering proofs or critical information that disqualifies the arguments of the opposite party can be very convincing in front of the judge.

Question:
The entire endeavour does sound quite costly – possibly prohibitively so for small businesses trying to survive in a big world. Is it just as important for these smaller business as it is for big corporations?

Answer:
Yes indeed, Business Intelligence matters for small business as well as big corporations, and even to individuals in some cases. The question is not so much the size of the business as what’s at stake: a small acquisition made by a large multinational company might not justify a full blown Business Intelligence research on the target’s reputation and associated risks. However, for a mid-size company involved in a lawsuit with a distributor in a key market, investing in litigation support, Business Intelligence definitely makes sense. It all boils down to a question of proportionality: the higher the risks, the more necessary to mitigate risks through an appropriate assessment.

Question:
We can’t open a newspaper, turn on the television or browse the internet without being bombarded with news about cuts and curbed spending. What are the burgeoning growth markets for BI?

Answer:
In times of burgeoning economy, corporate agendas focus on acquisitions and penetration of new markets. As a consequence, demand for Business Intelligence services most often relates to reputational due diligence research and other risk-mitigation investigations in the context of growth projects. But in times of recession, such fancy expenses are obviously significantly cut. However, the financial crisis increases tensions between business partners and generates a rising number of lawsuits. A case in point relates to the Madoff scandal: numerous Business Intelligence firms were hired worldwide by law firms on behalf of defrauded investors. Therefore, litigation support projects and asset searches rise to the top of the agenda. Also, corporations and banks increasingly pay attention to the integrity of their workforce. A number of large companies and banks have developed pre-employment background screening processes for candidates. Some Business Intelligence firms are hired in order to conduct these so-called know your employee (KYE) investigations. Finally, concerns about compliance increase both within multinational companies subject to the US Foreign Corrupt Practice Act (FCPA) regulations, and financial institutions. This triggers repeat due diligence research on counterparties.

Question:
How prudent is it to invest in Business Intelligence during a recession and how can it help us out of it?

Answer:
As stated above, Business Intelligence provides a competitive edge but must be proportionate to the stakes. Therefore, if necessity calls for it, there is no reason not to invest in Business Intelligence in a time of recession. For instance, cheap assets might be available on the market as a result of the financial crisis. This might provide opportunities for companies wishing to make acquisitions, but risks should be assessed as a proportion of the prospective investment. Which calls for reputational due diligence research on the prospective acquisition targets. Business Intelligence can also help out of a recessionary period, to some extent. Swiss private banks were affected by the erosion of bank secrecy. However, opportunities of growth are strong in Asia, the Middle East and some African countries. Business Intelligence can help such banks determine which business models were successfully applied by competitors in order to tap the growth of emerging markets. Also, once a development on a new market has been decided, market entry Business Intelligence can help understand the local dos and don’ts. For instance, I remember this private bank asking itself: how is the best way to take benefit of the growing market in Angola? Should we establish a representative office or handle everything out of Geneva? Answers are generated by careful Business Intelligence research.

Question:
Can you tell us what your staff are doing at One Intelligence to innovate in the Business Intelligence field?

Answer:
First, as a demand-driven company we stick to the needs of our clients. That does not mean that we are reluctant to innovate. But one must recognize that demand from clients revolve around a number of Business Intelligence services which have not fundamentally changed over the years. That includes reputational due diligence research, competitive intelligence, support to litigation, asset searches and background screenings on potential job candidates.

That said, many operational aspects of our jobs have changed across recent years. For instance, the amount of information recorded by the Internet and press aggregators has increased dramatically. Some service providers have developed automated research tools that crawl the Internet and aggregate data in an organised way. Firms like One Intelligence, as a response, need to focus increasingly on high value added information. This can be obtained only through inquiries with human sources and ad hoc investigative techniques. Our motto is to offer the best of craftsmanship at a sensible price. Remember, investment into Business Intelligence must always be proportionate to the stakes – otherwise client satisfaction completely vanishes. The return on investment must be tangible for clients.

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