BizTech Law Blog
The term "competitive intelligence" is the process of legally gathering information about one's competitors to gain a strategic advantage in the marketplace. Large corporations will have strategic intelligence experts as a part of their marketing department. These experts specialize in discovering promotional activities, sales figures, and other information about the company's competitors. Ideally, strong competitive intelligence enables a company to predict the strategy of a competitor and adapt with a strategy of its own that will result in an advantage in the marketplace.
The good news is that small and medium-sized businesses are not usually the targets of professional competitive intelligence experts. However, a business owner would be wise to protect itself from amateur intelligence gathering by its competitors. Competitive intelligence gathering begins by identifying the strategy of your own business and how your competitor's strategy will interfere. Then the intelligence gathering begins.
Competitors may send someone to one of your stores to strike up a casual conversation with a manager, friend your employees on Facebook or track them on LinkedIn, call from a blocked phone number or email from a fake identity, or post fake job openings in hopes of interviewing your former employees.
One competitive intelligence expert suggests four steps business owners can take to protect themselves. First, owners should improve their workplace culture to lower the possibility that its workers feel mistreated. Those who feel mistreated are more likely to divulge sensitive information to competitors. Non-disclosure clauses in the employment agreements of all employees with sensitive information are also helpful, but can be hard to enforce. Second, businesses should be wary about being contacted by a blocked phone number or an email address that is not readily attributable to a person or entity after a brief web search. Anyone can dial *67 to block their cell phone number and it is common for competitors to make up a fake identity in hopes of gathering information from a competitor. Third, businesses should ensure that their website is not a source of sensitive information. Clean up your webpage and then contact your IT provider to have them install a file called "robots.txt" in your web domain so the site Archive.org will delete the archived version of the website. Finally, remind your employees to be careful about what they post on social media. Employees may be disclosing more than they should on their profiles, and it is easy for a competitor to find this information quickly.
ShareholderMike is a business and estate planning lawyer in the Grand Rapids office of Foster Swift and is the current leader of the firm's Agri-Business sub-practice group. His area of expertise is business succession planning. This involves ...
