Getting the low-down

Joshua Jampol. Journalist. The Time

23 May 2003

Economic wars have always been with us, down through the centuries. But today’s more complex and rapid-changing world has given economic intelligence an even greater role to play.

Is it economic war, industrial espionage, or a true method of management? Whatever you call it, in an economic world that has shifted from factory production to customized consumerism, the techniques are used more and more.

Experts date the origins of economic intelligence back to the 1960s and ‘70s, when many countries in Europe discovered competition. In the ‘80s came the quality revolution, with Germany, Japan and the U.S. leading the way. The ‘90s ushered in the information age. The techniques of economic intelligence, more finely honed and with widened horizons after these movements, are still very much with us.

Economic intelligence has been described as the ability to mobilize strategic information within the company to better meet customer needs. Its harvest is used by a business to differentiate itself from the pack. It has also been called a systematic management method of knowledge-gathering that produces information used in decision-making on all questions affecting an organization’s performance and value creation.

Today, EI lets companies anticipate moves their competitors will make, thus giving them room and time to prepare. For fundamental to firms today is the power to innovate and the ability to give priority to more offensive strategies. This is particularly true for product quality, which requires an ever-increasing information flow during a product’s life.

One difficulty for CEOs today is that they must protect their company, while opening it up to the outside, forming fresh partnerships and developing new forms of collaboration. Today’s global marketplace has pretty much spelled the death of the go-it-alone firm, one which can do all things without any alliances at all. Yet is has meant more dangerous pitfalls for firms embarking on such alliances.

[*D Economic Intelligence *]

Criminal practices are not new to business. Scandals at Enron and elsewhere have made it clear to some that dishonesty is perhaps more rampant than they thought. Scams have likewise shone the light more sharply on individual company leaders. Using economic intelligence, firms can hire private investigators to get the truth, or the dirt, on the competition.

Thirty years ago in the U.S., the Freedom of Information Act turned certain types of information into accessible and marketable goods.

You can purchase information on an individual or corporation’s fiscal or environmental history from local and federal authorities, chambers of commerce, regional planning bureaux and patent offices. Courts also supply a wealth of information. In Europe, trade unions are good sources of information.

Such digging and fact-finding is easier in the U.S. In the U.K., not all this type of information is publicly available, nor can it be found on any database, making it more difficult to gather. In France, it is illegal to look for information on an individual’s criminal past.

On the other hand, though American companies must yield more information, current laws in many European countries - particularly concerning the environment and security issues – require firms to publish certain types of information that is impossible to unearth in the U.S.


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