Int. J. Emerg. Sci.

, 3(2), 171-181, June 2013

ISSN: 2222-4254
© IJES

Role of Competitive Intelligence in Multinational

Companies

Noor-Ul-Ain, MehwishWaheed, Amber Jamil

Department of Technology Management, International Islamic University Islamabad, Pakistan.
Department of Technology Management, International Islamic University Islamabad, Pakistan.
Department of Management, International Islamic University Islamabad, Pakistan.

[email protected], [email protected], [email protected].

Abstract. The recent innovations within the organizations have dramatically

increased the competition. In order to survive in such a competitive
environment the organizations need to make effective competitive intelligence
strategy. This competitive intelligence strategy put enormous impacts on the
average growth of the firms, higher quality and overall performance of the
firms. Method; Survey was conducted to find out the role of Competitive
intelligence in the growth, higher quality, and performance of the firm as a
competitive advantage. Total one hundred professionals from the renowned
organizations took part in this survey as respondents. Results; Survey showed
that these companies use competitive intelligence, which is significantly
associated with growth, higher quality and performance. Results indicate that
the use of competitive intelligence impact positively on the growth; however
the quality and performance receives less influence, as a competitive
advantage of the organization.
Keywords: Competitive Intelligence, Higher Quality, Growth, Performance

1 INTRODUCTION AND BACKGROUND OF THE STUDY

Previously organizations kept their eyes on internal operations, when

environments were relatively stable and decision-making was major aspect of
managerial work. The environment become increasingly competitive day by day
due to the advent of technology and certain innovations so as a result, companies
focus on outdoor surroundings and keep on watching and tackling mystification of
warning signs [5].Competitive intelligence examining is key instrument to get
information that is desirable for market adoption [7]. Organizations should focus the
competitive environment and competitive intelligence strategies that are necessary
for their survival in the market and on the other hand managerial work focuses”
what is going on in order to decide what is to be done” .The effective process of
competitive intelligence (CI) must hold two sets of strategic concerns:
- To gather information about the competitive environment

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- To understand the information so that, organization can be aware of the

environment that allows the organization to operate in such a way to build up its
competitive position strongly and to shun the blindsided or grasped surprisingly.
CI is the process that refers to the attractive marketplace competitiveness. It
can be categorized as a learning approach of the firm that deal with the activities
and competences of existing and possible challenger participants and help in
strategic decisions making [2]. Therefore highly intelligent professionals and
renowned organizations carryout CI for setting a strategy towards large and small
companies by making changes in their strategy in competitive landscape. It
concentrates on identification of change and market, rivalry, technology, novelty,
pattern of customer behaviors, and the future prediction trends, which are needed
for competition. It shares intelligence associated with customers, competitors and
any other environment that helps the managers and executives in strategic decision
making for a firm [8].
In fact, CI is a process of figuring out what is happening and decide what
steps and actions should be taken before your competitors is competitive
intelligence. It is also “the art of locating, collecting, processing and storing
information to be made available at all levels in the firm, with a view to shaping its
future, but also protecting against competitive threat” [1].
1.1 Concept of Intelligence
These days competitive intelligence is necessary for organizations for their
survival. If a company underestimates the competitive intelligence and intelligence
strategy, it will no longer remain in the market [8]. Due to such importance,
researchers conducted the present study in order to analyze the role of competitive
intelligence for multinational companies of telecom sector of Pakistan. Analysis has
made on a Pakistani frame of reference. The researchers has attempted to find out
the effect of competitive intelligence on the factors like increase market growth,
higher quality and performance of the firm. Although many companies focus on
these; economies of scale, innovation in IT, just-in-time production techniques,
distribution & support system, marketing skills, still they face a lot of obstacles in
their success.
1.2 Overview of Multinational Companies
The multinational companies working in telecom sector includes Warid
Telecom International, Mobilink GSM and Zong. Warid telecom is an Abu Dhabi
based mobile telecommunication firm providing telephonic services in Congo,
Pakistan and Uganda. Warid Telecom (Pvt.) Limited provides GSM services in
Pakistan. Mobilink GSM is a telecommunication service provider at national and
international level. It started operations in 1994 in Pakistan by Motorola Inc. later it
was sold to Orascom Telecom which is an Egypt based multinational company.
Zong is a first international brand of China Mobile Company launched in Pakistan
in 2008 .The Company is regularly cited as China Mobile Company in Pakistan.

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2 LITRATURE REVIEW

Competitive Intelligence, a marketing tool and sometimes-called marketing

strategy significantly an impact on organizational overall growth and create an edge
for it. Many studies from different researchers showed that CI is important for
companies for their long and short-term objectives. Murphy [4] investigated from
1,025 executives of different Canadian Technology companies and concluded a
framework or salient features required to conduct the Competitive Intelligence
process.

Porter in 1980 proposed that Competitive Intelligence (CI) serves the idea
of Intelligence; that is, to attain the strategic advantage. Therefore, competitive
Intelligence take in competitor intelligence in addition to intelligence gathered on
customers, suppliers, technologies, environments, or potential business relationships
[4]. Scholl hammer, in 1994 went through an extensive literature review and recon
that intelligence is not merely monitoring and examining the rivalry, but also the
whole environment of the business.

According to Zangoueinezhad & Moshabaki [8], companies that have

proper modern advanced systems for supervising their competitors’ tricks
demonstrated superior quality, competitive advantage, lower price and general
insight improvement. This literature review makes it quite evident that the
importance of CI for firm is very crucial. As far as the company is up to date with
its competitors, it can help improve its own loopholes or eradicate it.

2.1 Growth of the Firm

Market growth is important for the firm’s position in the market. It helps
in grabbing the market share. It enhances the market value and increase profitability
of the firm. Similarly, the involvement of learning process, developing CI systems,
competitive intelligence and source of information works as important factors to
achieve the relative success in international market as well [3]. Managers should be
aware of growing markets and market segments. CI and growth of the firm are
interrelated with each other and have great importance for firms; that is why
researchers have used this variable as follows:
H1. Use of competitive intelligence is positively associated with growth of
the firm.

2.2 Higher Quality of the Firm

CI focuses on the competitive advantage of the organization. It provides a

company a rivalry advantage. It also enhances competitive advantage for
corporation by permitting the launch of new products successfully, better planning
of business, and development of new products [8]. By using competitive
intelligence information, the competitive advantage is signifying by higher quality
[6]. It is a capability of differentiating position of one firm with regard to its
 Noor-Ul-Ain, MehwishWaheed, Amber Jamil

competitors. As quality, technological expansion, experienced staff, better

supervision and novelty are the basic characteristics in improving the competitive
intelligence (CI) of any firm. Therefore, due to its importance, the researchers have
used this variable as follows:
H2. Use of competitive intelligence is positively associated with the higher
quality.
2.3 Performance of the Firm

CI has three main events includes the gathering and managing the data, to
analyze and interpret it and distribution of intelligence. Competitive intelligence
involves scanning of environment for collecting and dealing with the information
[4].In fact, the significance of inspecting the environment has been associated to the
performance and growth of the firm. It helps in dealing with information and
strategic decision-making, which ultimately lead the organization to grab more
market share. Non-satisfactory competitive practices lead to insufficient market
value. The researchers have used this variable as:

H3. Use of competitive intelligence is positively associated with

performance of the firm.

2.4 Research Framework

Figure 1 Theoretical Framework

3 RESEARCH METHODOLOGY

3.1 Research Design

Quantitative research technique has used in this research study. Survey

technique has used to collect the data via primary source.

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3.2 Population

The highly professional employees of the multinational companies like

Warid, Mobilink and Zong from the Pakistan, are the target population of this study.
Considering the relevancy of data with the strategic and competitive decisions of the
firm, data has collected only from the selected higher-level employees.

3.4 Sample

The sample for this study is the high rank employees of Multinational
Telecom Companies in Islamabad. This study encompass the comparison of three
top ranking telecom companies; Warid, Zong and Mobilink. Data has collected
from Executives, Senior Managers and Assistant Managers of the said companies.
The questionnaires were distributed among the 150 respondents, out of which 110
respondents responded successfully,but out of these 100 questionnaires were
useable. Hence, our sample size is one hundred (100). The questioners were evenly
distributed among three companies; Warid =33, Zong = 33, Mobilink =34 and
equally distributed in their offices at Islamabad.

3.5 Research Tools and Instruments

Questionnaire has used as an instrument .It was designed on five-point

likert scale.

3.6 Measures

All the measures has extracted from reliable source. The scales for the
Competitive Intelligence, growth, performance, higher quality has been adapted
from Steffen (2002) MBA Dissertation and Oxford University Press (1996).

4 RESULTS AND FINDINGS

4.1 Descriptive and Reliability Statistic

The descriptive statistics showed that the decision makers were slightly
agreed to the role and impact of competitive intelligence towards the Growth of the
firm, higher quality and the performance of the firm together with the mean values
2.68, 2.73 2.60 and 2.51. The results of the descriptive analysis highlight the
effective role of competitive intelligence in organizational growth, organizational
higher quality and over all organizational performance.
 Noor-Ul-Ain, MehwishWaheed, Amber Jamil

Table 1: Descriptive statistic analysis

Variables N Mean SD Cronbach’s Alpha

Growth of the firm 100 2.68 0.506 0.643

Higher quality 100 2.73 0.669 0.669

Performance of the firm 100 2.60 0.570 0.747

Competitive intelligence 100 2.51 0.364 0.682

4.2 Correlation Analysis

The analysis for our first hypothesis, Pearson Correlation matrix concluded
that there is a very strong positive relationship exists between the competitive
intelligence and the growth of the firms in Pakistan. The significance of this result is
p < 0.01 and correlation figure for this relationship was found to be 0.744**. Hence,
our first hypothesis that is the use of competitive intelligence is positively
associated with growth of the firm is therefore supported from the Pearson
correlation value. Correlation matrix concluded that there is moderate positive
relationship exists between the competitive intelligence and the higher quality as the
correlation figure for this relationship is found to be 0.428**.Hence our second
hypothesis that is the Use of competitive intelligence is positively associated with
the higher quality is therefore supported from the Pearson’s correlation matrix.
Table 2: Pearson Correlation matrix

Variables Growth Higher Quality Performance of Competitive

firm Intelligence

Growth of firm 1

Higher quality 0.512** 1

Performance of firm 0.295** 0.447** 1

Competitive intelligence 0.744** 0.428** 0.313** 1

**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

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For our third hypothesis the correlation matrix concluded that there is moderate
positive relationship exists between the competitive intelligence and performance of
the firm. The significance of this result is found p < 0.01 and correlation figure is
0.313**.Hence our third hypothesis that is the use of competitive intelligence is
positively associated with the performance of the firm is therefore supported from
the Pearson’s correlation matrix.

4.3 Regression Analysis

The results have measured using SPSS for the regression analysis, are
mentioned in Table 3. It was required to measure the comparison of three
companies; the linear regression is applied separately for each company’s data to
get the beta values. For that purpose the data is distributed on three columns, 1st
column is for Warid, 2nd column is for Zong and 3rd column is for Mobilink. The
beta values for each company are shown in Table 3.
Table 3: Regression Analysis

Beta (β) for Warid Beta(β) Beta (β) for

Mobilink
for

Zong

Competitive Intelligence 0.815*** 0.707*** 0.708***

& Growth of the firm

Competitive intelligence 0.617*** 0.338* 0.269

and the higher quality

Competitive intelligence 0.389* 0.147 0.512**

and the performance of the
firm

The result of the regression analysis shows that Competitive intelligence is

significantly associated with the growth of the firm having β= 0.815*** in Warid,
β=0.707*** in Zong and β=0.708*** in Mobilink and proving the high significant
level for all the three companies with the P value <0.001. It shows that the
competitive intelligence is playing a key role in the growth of the firm.

The favorable association is found between the Competitive Intelligence

and the higher quality of the firm especially in the Warid as the β=0.617***, as the
level of significance is p<0.001. There is less favorable association between the
Competitive Intelligence and the higher quality of the firm in Zong as the β=0.338*
together with the significance level of p<0.05 and with negligible significance in
Mobilink as β= 0.269. It is showing that the Competitive Intelligence is playing
 Noor-Ul-Ain, MehwishWaheed, Amber Jamil

significant role in the Quality and competitive intelligence in case of the Warid
telecom and least in case of Zong. However, Mobilink have negligible level of
Competitive intelligence impact on Quality aa a competitive advantage.

The association of competitive intelligence and the performance in case of

Warid was found to be less as the β=0.389*, the level of significance for this case is
p<0.05. In case Zong this association was found to be negligible together with the
negligible level of significance and a moderate relationship was found in case of
Mobilink as the β=0.512** with level of significance of p < 0.01.

5 Discussion

It has proved from the results that the competitive intelligence is positively
associated with the growth of the firm, higher quality and performance of the firm
from the correlation matrix. The competitive intelligence and its association with
growth of the firm is very high as the percentage beta value in the cases of Warid,
Zong and Mobilink touches the peak of 81.50%, 70.70% and 70.80%. The
association of competitive intelligence and the higher quality is moderate as the
percentage beta value in the case of Warid, Zong and Mobilink is 67.10%, 33.80%
and 29.90%. The percentage association between competitive intelligence and the
performance is 38.90% in case of Warid, 14.70% in case of Zong and 51.20% in
case of Mobilink.
Table 4: Companies Comparison

Warid Zong Mobilink

Competitive intelligence and Growth 81.50% 70.70% 70.80%

Competitive intelligence and higher quality 67.10% 33.80% 26.90%
Competitive intelligence and Performance 38.90% 14.70% 51.20%
The result of the regression analysis among Competitive intelligence, Growth,
Higher quality and Performance is showing the beta values of the three targeted
companies is shown in Table 4. The table 4 is showing the comparisons of beta
values of three companies in percentage form. These results have also represented
in the following chart.

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 International Journal of Emerging Sciences 3(2), 172-181, June 2013

Chart1: Percentage relationship among the growth, higher quality, performance

and competitive intelligence

The overall results are showing that the Competitive Intelligence strongly
effect the growth of the firm but it effects a little on the performance and quality as
a competitive advantage.

7 Conclusion

We have selected the multinational companies, which includes Warid, Zong

and Mobilink because of their tough competition in the market. These companies
use competitive intelligence, which is positively associated to growth, higher quality
and performance as a competitive advantage. The results indicates that use of
competitive intelligence have high impact on growth and less on higher quality and
performance. The results of the research have based on a limited sample, therefore,
these results cannot be generalized. After comparison, it has shown that CI plays an
important role in the growth, higher quality and performance of the firm to attain a
strong position in the market and to meet with competences against its competitors.

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 Noor-Ul-Ain, MehwishWaheed, Amber Jamil

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