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Conducting Competitive Intelligence in Eastern Europe

It has been 20 years since the fall of communism in Eastern Europe and the former Soviet Union. Since then, a vast land of some [200] million people have been open to the Western consumer markets, thus creating a wave of opportunities for investment. For most US investors, not to that extent for their Western European counterparts, Eastern Europe turned out to be a kaleidoscopic land of culture, customs, and business behavior that is different and for which one needs a Lonely Planet guide for each major city, thus building a shelve of guides for the region.

MM Consult and The Repton Group have partnered to provide solid Competitive Intelligence (“CI”) services in that region.

One subtle issue that does not surprise a local CI professional in this environment is the connotation of “intelligence” in the whole context of Eastern Europe. The word bears the extinct reminiscence of the communist past, as intelligence was applied only by the state apparatus which was part of the state and the military systems. So, any time we mention we are professionals in this field in Eastern Europe, people raise their eyebrows and ask “You are a part of the ex-secret service?”  Indeed, most of the practitioners in the CI field have emerged from the post-communist secret services, thus bringing best practices into the field of competitive intelligence in the region.

However, MM Consult stopped worrying about the issue of presenting myself and simply introduce itself as a finance professional with a very good market understanding.

Now this works. Additionally, a successful operation here requires at least the following steps:

· Be local – have a local research capacity that will help guide you through the local intrigues and be able to help you with the language;

· Be intuitive – data exists in all Eastern European societies and in most cases is unsystematically scrambled. You will need to dig for data. However, it is there.

· Be persistent - data in this region is hard to find. As opposed to the information flow and accessibility that exist in Western societies, data here is often not available or inconsistent with reality. Check, check, double-check is a key to finding the valid, most current information. Additionally, official information is often invalid, making CI work even harder.

· Be resourceful- A key to finding and trusting data in the region is to have as many contacts as possible. This takes time, social skills, psychology, and street smarts, sometimes even cash or other under the table.

· Be systematic in your analysis – all Eastern European societies have gone and grown very much in their business development. Still, it is common to see a local company with annual turnover of more than €100 million. ($131 million.) that does not prepare an annual business plan – not to mention any forecasting for the next  three to five years.  You need to deploy extra research capacities to better understand the realities.

· Be selectively comparable – you will be able to reconstruct the past with forensics approach but you need to be selectively comparable to the patterns that will emerge in these economies vis-à-vis their Western peers. Culture and history have their say while building your forecasts.

Viktor Manev CMC
MM Consult EOOD