When organizations fall behind the competition, we often hear people describe how the enterprise had become increasingly insular in recent years. Managers focused on enhancing operational efficiency, and they fixated on internal processes and procedures. As a result, they did not recognize key trends and changes in the marketplace. They did not spend enough time learning about new types of competitors. How can we become better at scanning our external environment? Here are four key steps that can enhance your efforts:
1. Make time for environmental scanning on your agenda. Carve out space on your calendar each week to learn about new technologies, products, or competitors. Dedicate some time each year to attend a conference, speaker, or workshop that falls outside of your normal routine. If you don't make time for scanning, it's easy to allow other duties to crowd out this key activity.
2. Identify some young people in your organization with whom you can connect on a regular basis. Talk to them about social and technological trends. Compare and contrast how they use their smartphone, computer, television, automobile, and other devices differently than you do. Inquire as to how their consumption patterns might differ from yours (currently or when you were their age).
3. Make it a habit to read the major SEC filings of your competitors. Don't just read the articles that appear in the Wall Street Journal. Dig into the details found in those financial reports. Read what analysts are saying about the competition as well. Consider listening to a few earnings calls from your rivals. It's amazing how many managers have never actually dug into these types of documents. They rely on journalists to tell them about major events taking place in their industry without studying the competition more closely.
4. Take a look at what your suppliers are doing. Many environmental scanning efforts focus on customers. That's important, naturally. However, you can also glean a great deal of information from your partners and vendors in the supply chain. How is their business changing? Are they selling to different people? Have their portfolios of products and services changed? Have any of them started to vertically integrate? Suppliers must adapt as they see changes downstream in the value chain. Watching for those adaptations can tip you off to key trends in your market.