Competitive Intelligence as a Source of Competitive Advantage: An Exploratory Study of the Portuguese Biotechnology Industry

Regarded as a strategic information management process, competitive intelligence (CI) is defined as the conversion of the data and information, gathered by an organization from its external and internal environment, into intelligence that supports the organizational decision-making process. It is widely accepted that CI provides management with valuable items of information that improve the quality of decisions and has a positive effect on a company's competitiveness. Considering the economic importance of the biotechnology industry for Portugal, it is appropriate to study the level of awareness of CI and to identify and describe CI best practices in this sector. An exploratory study was carried out to examine how organizations in the Portuguese biotechnology industry use CI in order to obtain sustainable competitive advantage. Additionally, this research was designed to create hypotheses that could be tested in further studies. Case studies were carried out in two companies and a literature review was conducted to help develop a theoretical framework that would support further analysis. Research shows that the terminology and concept of CI were not well-known inside the two companies, probably because of the prevailing scientific-technical background of their personnel, as distinct from one of management; they therefore lacked the specific, dedicated infrastructure and personnel to perform CI. Yet, CI is carried out in an informal way, mostly by the decision makers themselves. Additionally, the findings suggest that organizations tend to focus on developing information management processes primarily oriented to internal information assets, such as Business Intelligence or Knowledge Management. The resources provided for these processes tend to reinforce and support the intelligence cycle, thereby improving the overall awareness of CI. Differences in the level of informality of CI activities were also found between the two organizations; the larger and older organization tended to be more formal in its approach to CI activities. Interestingly, recent approaches featured in the strategic management literature (e.g., dynamic capabilities) indicate that an informal and tacit CI process is more likely to generate sustainable competitive advantage than a completely explicit one, since the former is more difficult to imitate or substitute.