Introduction to Prompt Engineering (Focusing on ChatGPT)
Mtm2 white paper competitor analysis (featuring the four corners)
1. BCG Growth/Share Portfolio Matrix
ITOTW 1
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Competitor Analysis
(Featuring the Four Corners)
Intelligence Collaborative - Mastering the Methods Series
2. Competitor Analysis feat. the Four Corners
This White Paper is #2 in a series of intelligence methods being offered to members of the
Intelligence Collaborative. It was developed by Dr. Craig S. Fleisher to provide a concise
overview of how to apply key intelligence methods to support analysis. Although every
effort is made to ensure that the information is accurate and fit for its purpose, the author
and Aurora WDC make no implied or explicit warranties as to its applicability or use in
your particular work context.
Please direct any questions about this paper to its author at the following:
Craig S. Fleisher, Ph.D.
Aurora WDC
Email: craig.fleisher@aurorawdc.com
http://IntelCollab.com
Other White Papers are available on a regular basis from http://IntelCollab.com. Related
Methods in the series are:
Driving Forces
Industry Analysis
Financial Ratio and Statements
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4. Competitor Analysis feat. the Four Corners
Abstract
The Competitor Analysis (featuring the Four Corners) is a primary method in the competitive and
market intelligence tool kit. It is not a single concept, but rather a deliberate combination of several
techniques (featured here as one of which is Four Corners analysis originally popularized by Harvard’s
Michael Porter) that help the analyst to determine how rivals may affect and influence the success of
their own organization’s efforts out in the competitive marketplace. The managerial focus of this
analysis tool is that important decisions should incorporate knowledge of the relational dynamics
between your company and its market or industry rivals.
The Method’s Primary Value
Competitor analysis featuring Four Corners analysis encourages your company to adopt a confident,
aggressive and proactive position toward competitive strategy and the broader business environment.
The inclusive nature of competitor analysis encourages the sharing of insights and perspectives across
functional boundaries of the company. It helps the company develop a competitor-conscious culture
amongst those involved in its development, thus enabling you to employ your intelligence networks in
support of data and information gathering that can further help you exploit opportunities and
ameliorate threats.
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5. Competitor Analysis feat. the Four Corners
The knowledge provided about competitors allows your company to help shape and define the
parameters of strategy rather than react to unexpected competitive sideswipes.
It creates an efficient and effective approach to strategy formulation. The relevant, timely, concise and
visually accessible presentation formats of this technique are an excellent vehicle to communicate
strategy.
Overview of the Method
Another competitive analysis model that was popularized by Harvard Business School Professor Michael
Porter, Four Corners analysis is a useful method designed for analyzing competitors as well as your own
company. The four corners refer to the four elements that are critical in analyzing a market rival,
including independently and collectively assessing its 1) assumptions, 2) capabilities, 3) current strategy
and 4) drivers/future goals. Unlike (mostly) static models like SWOT that are often inappropriately used
for the purpose of competitor analysis and don’t actually help the analyst understand what would
motivate a competitor to take particular actions, the four corners method was developed to capture
insights about what competitors plan to do from the present forward.
What Drives the Competitor?
DRIVERS – Covering All Levels of
Management
What Can the Competitor Do?
STRATEGY - How the business is
currently competing
MOTIVATIONS
COMPETITOR'S INSIGHT
PROFILE: Is the Competitor
satisfied with its current
position? What likely moves
or strategy shifts will the
competitor make? Where is
the competitor vulnerable?
ACTIONS
ASSUMPTIONS - Held about the company
and the industry
CAPABILITIES – Both Its Strengths and
Weaknesses
Source: Adapted from Competitive Strategy: Techniques for Analyzing Industries and Competitors by
Michael E. Porter, 1980, New York: Free Press (referred hereafter as Porter, 1980).
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6. Competitor Analysis feat. the Four Corners
The drivers/future goals section is derived from the important perspective that
companies have various unique goals and thus pursue unique market-focused moves. For example, a
competitor’s financial goals reflect its current situation or whether it is looking to implement change,
while its operating goals can signal whether it is building capacity or re-orienting along the industry’s
value chain. The background of the top executives offers indications of what goals they prefer achieving
and external constraints often signal whether a company is likely to be more sensitive to certain
stakeholders in the industry, such as public officials like government regulators or advocacy groups
(Porter 1980). From the analyst’s perspective, the rival will likely be focused mostly on these things, and
may not have their “eye” on other developments that your company can leverage in the marketplace.
The assumptions section helps the analyst better understand the competitor and its
strategy. This perspective is related primarily to two aspects: a) the rival’s assumptions about a
competitor company (possibly your company) and b) the competitor’s assumptions with respect to the
industry and the other companies competing in it. This component can comprise questions and
characteristic elements such as perceived industry forces (e.g., Porter’s 5 Forces method) and a
company’s relative position (i.e., attractive or unattractive position) regarding these. Similarly, beliefs
about competitor goals have influence, as well as cultural, experiential, geographic and national
differences, that can be seen as the orientation towards the opponent’s competitive market approach
(Porter, 1980). The key here is to be able to identify any incorrect assumptions your rival might have, or
any blind spots of which you may be able to take advantage.
The next component of the analysis framework is a competitor’s current strategy. Key
aspects included in the analysis here are: 1) its stated (and unstated or implicit) goals; 2) its competitive
posture; 3) its scope; and 4) its recent moves. Others to be considered are its business model, path of
creating value, and the executive team’s statements of future direction. The strategy characteristics can
be simply regarded as built from key operating procedures that a competitor actually employs (Porter
1980). In general, analysts should be looking for those areas where the rival claims they want to be
doing something (goals), but they do not have the appropriate or timely resources or capabilities to
execute it.
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7. Competitor Analysis feat. the Four Corners
The fourth component is labeled capabilities. These underlie and determine a
competitor’s ability to respond to strategic moves or industry changes. This “corner” often includes a
lengthy list of characteristics to be used as bases for analysis. Some examples are its human resources,
intellectual assets and capital, marketing prowess, and of course, their financial wherewithal. SWOT
analysis approaches are often used to gather and organize this information, which is then incorporated
into this section (Porter, 1980). The idea is to make an assessment about external issues to which the
rival could easily respond – for example it might have great long-term staff it can rely on to drive the
business forward. You also need to make an assessment about competitor weaknesses – for example, it
might not be financially viable enough to survive another global economic downturn.
Where the Method Fits in Planning and Strategy
Unfortunately, a number of surveys by the (former) Society of Competitive Intelligence Professionals
(and now the Strategic and Competitive Intelligence Professionals - SCIP) done as recently as 2005
suggest that Four Corners analysis does not feature in the list of the most commonly used tools in the
analysis methods tool-kits of their respondent companies. Competitor analysis featuring Four Corners
can support several important business and planning needs, including but not limited to the following:
1. Generate a profile about strategy changes a competitor is making and likely to make and to help
the analyst better gauge how successful these moves may be.
2. Help determine how different competitors will react to one another’s market moves.
3. Gauge how rivals will most likely respond to environmental, industry and market trends.
When completed, the competitor analysis framework is used to plot the offensive and defensive “game
plan” of a competitor. Alternatively, if the analysis is intended for company self-assessment, it focuses
on creating robust strategic positioning scenarios (Porter 1980).
Cautions with Applying this Method
The primary criticism of competitor analysis relates to the temptation for companies to make it the
cornerstone of their competitive strategy. In attempting to become an industry leader, a company will
eventually become a follower if it defines leadership too closely in respect to current competitors
because comparisons to competitors must always relate to the notion of customer value, and thus this
should complement and further enlighten your competitor analysis.
Constantly referencing a company’s strategy to existing competitors will eventually blind a company to
innovative approaches of potential new competitors from outside the periphery of the industry who
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8. Competitor Analysis feat. the Four Corners
deliver superior customer value. Thus, it is important to keep an eye on potential new competitors from
seemingly unrelated sectors and industries.
The copycat nature of outpacing the competition may prevent any competitive advantage from
becoming sustainable – companies should focus on generating real customer value, not ‘me-too’
imitation, in their search for profitable innovation.
Many of these limitations can be overcome by 1) astute analysis and 2) using this tool as a complement
with additional tools of competitive analysis. See our section on complementary tools below about this.
Applying the Method
1. Agree with your executives and colleagues about who your competitors are.
2. Determine who your competitors may be in the future.
3. Decide what information you need about these companies; acquire it.
4. Build the four corners map for own company; we recommend doing it visually using a four corners
grid.
5. Draw conclusions in the form of a Competitor Insight Profile (CIP) per rival, across your four corners
in parallel. Ask questions such as “how satisfied is this rival with its current position?” “What are the
likely moves or tactics is it likely to use in response to developments?” “Where can we attack the
rival where it is most vulnerable and least able to respond to our action?” and “Are there areas so
sensitive to the rival that they will surely retaliate against one of our actions?”
6. Develop your response strategy, and further refine it based on additional analysis.
7. Continually monitor the competitor set and scan for potential competitors.
Complementary Methods
• Competitive Simulations/War Gaming
• Enhanced SWOT analysis
• Executive Profiling
• Financial Ratio and Statement Analysis (FRSA)
• Functional Capabilities and Resources analysis (FCRA)
• Industry analysis
• Red/Blue Team analysis
• Shadowing
• Strategic groups Analysis
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9. Competitor Analysis feat. the Four Corners
Additional Resources
See chapter 4 (pg. 45-62) on Competitor Analysis featuring Four Corners in the (2013) book Analysis
without Paralysis: 12 Tools to Make Better Strategic Decisions, 2nd
Ed., by Babette E. Bensoussan and
Craig S. Fleisher, Upper Saddle River, NJ: FT Press.
Business and Competitive Analysis: Effective Application of New and Classic Methods by Craig S. Fleisher
and Babette Bensoussan, 2007, Upper Saddle River, NJ: FT Press.
Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter, 1980,
New York: Free Press.
Strategic and Competitive Analysis: Methods and Techniques for Analyzing Business Competition by Craig
S. Fleisher and Babette Bensoussan, 2003, Upper Saddle River, NJ: Pearson/Prentice Hall.
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10. Competitor Analysis feat. the Four Corners
Additional Resources
See chapter 4 (pg. 45-62) on Competitor Analysis featuring Four Corners in the (2013) book Analysis
without Paralysis: 12 Tools to Make Better Strategic Decisions, 2nd
Ed., by Babette E. Bensoussan and
Craig S. Fleisher, Upper Saddle River, NJ: FT Press.
Business and Competitive Analysis: Effective Application of New and Classic Methods by Craig S. Fleisher
and Babette Bensoussan, 2007, Upper Saddle River, NJ: FT Press.
Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter, 1980,
New York: Free Press.
Strategic and Competitive Analysis: Methods and Techniques for Analyzing Business Competition by Craig
S. Fleisher and Babette Bensoussan, 2003, Upper Saddle River, NJ: Pearson/Prentice Hall.
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