Big Industry News? How Do World Class Analysts Respond?

During this episode, Cascade Insights’ CEO, Sean Campbell and SAP Lead Analyst Matthew Sell discuss how world class analysts respond to and analyze big industry news events.

Big Industry News? How Do World Class Analysts Respond?

We cover:

  • Big industry news? How do world class analysts respond?
  • How to balance the immediate need for a reaction with providing meaningful insight.
  • Why context and meaningful insights are so important to getting it right.
  • Why competitive intelligence and market research teams need to focus on stakeholder engagement.
  • How industry experience leads to better insights

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Speaker: Sean Campbell, Cascade Insights’ CEO

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[Modified Transcript]

[Sean:]

This podcast is brought to you by Cascade Insights. Cascade Insights specializes in conducting market research and competitive intelligence studies for B2B technology companies. Our specialization helps us deliver detailed insights that generalist firms simply can’t match. Please check out past podcast episodes and our blog – and don’t forget to sign up for our newsletter.

Today I’m speaking with Matthew Sell, who gets the award for being our first repeat guest on the podcast. There’s a good reason for that. Matthew, why don’t you go ahead and reintroduce yourself.

[Matthew:]

My name is Matthew Sell, I’m an analyst in SAP’s competitive and market intelligence team. I’ve been doing various competitive and market intelligence roles for the last 15 years or so, across a couple of different companies. It’s great to be back on the podcast.

[Sean:]

It’s great to have you back. We brought you back in part because of an article you posted on how to analyze a news event – or really anything, as you noted in parentheses. I think the topic is really germane to a lot of our listeners, because they probably face this challenge quite often.

Our talk today will focus on the news event side. Why don’t we start with why you thought it was important to write about this issue? Obviously, there has been a lot of discussion on how CI teams should report on news and competitor activity, but I think you have a pretty unique perspective on it.

Big industry news? How world class analysts respond.


[Matthew:]

One of the reasons I put this article together is, I’ve noticed one of the traps competitive intelligence analysts, including myself, fall into is to merely report on what happened. If a competitor has a news release, a product launch, or some other market event, as an analyst, you need to do some analysis.

I’ve seen a lot of times when analysts have just reported on what happened. They didn’t go on to provide any real analysis, such as the impact the news event had either on the market or their company, let alone taking the next step to provide recommendations.

There’s a good quote that sums this up very well, which comes from Martin Petersen, a retired CIA analyst. The quote is, “Intelligence analysis starts when we stop reporting on events and start explaining them.” As competitive intelligence analysts, that’s what we should be doing. That’s the value we bring to the organization. It’s not just reporting on what happened. It’s starting to explain why we think it happened and the impact it has on the company and the market. Then, taking it even a step further, giving recommendations on what your company needs to do to react to it.

How to balance the immediate need for a reaction with providing meaningful insight


[Sean:]

I’m also a fan of that Petersen article. We’ve actually talked about it on the podcast before. That quote is something I use to use with my MBA students. I would say, “This is 12 pages of reportage, what’s next?” They would say, “But it’s a great paper.” I’d respond, “The reportage, yes, but it doesn’t actually explain anything.”

It’s funny you mentioned that quote too, because when people ask me to give feedback on a deliverable, I almost certainly will say, “You have 92 slides of reportage and two slides of opinion based on that reportage. You’ve aggregated 32 magic quadrants, and you’ve done a very good job of using control C and control V to put them into this deck. But, there isn’t any insight.”

Especially with breaking news, people often feel the need to comment on the event right away. The desire to do that in a timely manner sometimes gets in way of saying something meaningful. However, the organization probably already knows about the event. It’s unlikely you’re functionally educating the organization. If it’s important enough to know about, most people probably heard about it on their way to work. How do you give meaningful insight into the event when your manager or company is pressing you for an immediate reaction?

[Matthew:]

That’s a good point. I think it comes down to the remit of the intelligence team, within your organization. What’s the value add that you are providing?

I think, like you said, anyone can report on a news event. Anyone can copy and paste that URL and a headline and send it off. Anyone could just say, “Hey, our competitor just made an announcement,” or, “Hey, there’s a new product launch,” or, “Hey, there’s a new conference going on, or a new partner announcement.” You’re never going to win when striving to be first because everyone else in the organization is capable of doing that.

I think it comes down to rethinking what your remit as an intelligence organization is. Your value add should not be trying to report what the news is first, your value add should be the perspective that you provide.

Let’s say an executive gets a notification of a news event. The reaction you want them to have is, “Well what does the intelligence team think about this? What suggestions do they have that I need to do about it?” That’s the reaction you want as opposed to, “Why didn’t the intelligence team tell me about this event straight away?” There is some tension with trying to get that information out there as quickly as possible, and we all want to do that, but I think you need to think about what you provide as an intelligence team within your organization, and how that’s differentiated from what anyone else can do in the organization.

By analogy, think of the difference between Twitter and T.V. as news sources. If you want breaking news, you go to Twitter, not to the news on T.V., because that’s where you get it faster. You’re competing to a race to the bottom if you’re trying to be fast. You need to go beyond just reporting, and provide the insight on what it means to the market, to your company and how your strategy will need to change in light of the event. Do you have tactical recommendations in terms of competitive positioning or strategic recommendations for how the company should react?

Why context and meaningful insights are so important.


[Sean:]

One little addition goes back to your point about news organizations. People usually respect news organizations that do good analysis. In general, people don’t tend to respect “tabloidesque” reporting. Good communication requires good analysis. A point that leads naturally to the 2 by 2 grid featured in your article. I think you’ve got a unique perspective here; one that hasn’t been seen before.

Image used courtesy of Matthew Sell.

On the Y-axis you’ve got the level of analysis, low to high. On the X-axis you’ve got the time frame with immediate and reflective. The lower left corner has low and immediate combined with a shallow reporting on the news, as we’ve just been discussing. Then on the upper left you’ve got, basically, a high level of analysis with an immediate time frame. You say, “Analyze the news.”

Talk a little bit about that quadrant, and then we’ll go through the other two as well.

[Matthew:]

Analyzing the news is where you start going beyond just reporting what happened, and start answering questions about why it happened and the impact it will have.

As I said before, this is where you start to have some value add. Once you start examining why the event happened, it helps establish the importance of the event. One of the downsides of simply recapping the news is you leave it up to the reader or the consumer to determine whether it is significant or not.

The cause and the impact of the event can point to how much you need to pay attention. This helps you decide who to send your analysis to in your organization and the level of importance to communicate. That’s the top left quadrant.

The timeframe is more reflective in the bottom right quadrant, “Relate and provide context to the news.” Here, you start putting news items into context with other events, other pieces of a competitive strategy, other trends in the market, and other sign posts that support that trend. You start relating the news event to other comparable things.

Added context can be as simple as the news of a market trend or a particular competitor over a particular time frame. That’s what you see in most intelligence newsletters, they’re really aggregating news over a certain period of time.

Once you move up the axis on the level of analysis and start adding context, where you want to be is in that top right hand corner to provide insights on the news. This is where you’re going beyond reporting, beyond analyzing to putting the news into context of the wider, bigger, picture and to then offer explanations and recommendations accordingly.

For example, if one of your competitors makes an announcement, you should put that announcement in context of the competitor’s strategy.

For example, if one of your competitors makes an announcement, you should put that announcement in context of the competitor’s strategy. Does the new announcement support their existing strategy? Do they have a new partnership, a new product they’ve launched in a new market, etc., that could signal a strategic shift? As you move from the bottom left to the top right quadrant you’re adding increasing levels of analysis and increasing levels of added historical context, whether it’s market trends, competitive strategy, or anything relevant to the news event you’re analyzing.

Why competitive intelligence and market research teams should focus on stakeholder engagement.


[Sean:]

I think on that same continuum from lower left to upper right, from reporting to providing insight, there is a relationship between volume of activity and actual engagement. In the lower left, “reporting the news,” there is a tendency to say, “I’m doing well because I’m broadcasting a lot. I have a lot of activity.” Frankly, that’s the wrong measurement. You should have some understanding of your activity level, but it’s the engagement that really matters for an analyst team.

As you go into that upper right quadrant of providing insight, you should see increased engagement, but you’ll have lesser activity. As long as you’re getting the engagement, and you’re impacting decisions, or, at a bare minimum, impacting thinking, it’s a much better place to be.

[Matthew:]

I agree. You’re also filtering out what’s really important as you move up and to the right. Being in the top right hand quadrant, providing insight, forces you to have an existing, well thought-out perspective on the market, trend, competitor or whatever you’re following. You have to have that background available to put this new event into context. You won’t produce as many reaction pieces, but you’re increasing the depth of the analysis you’re providing, which, in my opinion, is more valuable.

It’s much harder to do that. You’ve got to work to have that existing perspective. You’ve got to work to do that kind of analysis and explanation. The insight you will be able to provide will be highly specialized, the kind you wouldn’t be able to get elsewhere.

How industry experience leads to better insights

[Sean:]

One last point to make is that it’s not that reporting is inherently bad or is something that an analyst team should never do. I think it’s just an issue of being very concrete and very intentional about the level of insight needed.

A junior analyst, for instance, may spend a quarter, a year, a portion of their career in the lower left quadrant, reporting the news. There’s always going to be a certain amount of reportage that the CI team ends up being responsible for, but it’s a matter of bucketing and aligning reportage with a better strategic vision. You can structure the rest of the team, the bulk of the team even, to be focused in the upper right quadrant, providing insights on the news.

[Matthew:]

Absolutely. Experience over time leads to being able to make good insights. If there’s a particular market, sub-market, trend or competitor that your team needs to follow, you’ll build a background following that particular area over time. At the beginning, you may just be reporting because you’ve got no context. As you build up experience following that particular trend or competitor, you get to know what their strategy is, the nuances of that trend and where it’s going.

Experience builds context, so the longer you focus on a particular area, the deeper you get to know it, the easier it is to analyze it in context and provide deep insight.

[Sean:]

That’s a good summary Matthew. With that, I want to thank you for being on the podcast again, and thanks to our listeners for following this episode. If you have any suggestions or topics you would like us to cover on the podcast, feel free to email me at sean@cascadeinsights.com. Also, don’t be shy to review the B2B Market Research Podcast on iTunes, Stitcher or other podcast repositories.

Thanks again for listening, and hope to have you along on the next episode.

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