Keeping Competitive Intelligence Ethical (And Legal) for peace of mind
In 2016, Anthony Levandowski moved from Google’s self-driving car company, Waymo, to Uber. Before leaving Waymo, Levandowski downloaded over 14,000 confidential files. All on autonomous vehicle technology and handed them to Uber. Uber welcomed him, seemingly unfazed by the theft. Repercussions ensued. Waymo sued Uber for trade secret theft and won $245 million in damages. This high-profile case underscores the importance of conducting competitive intelligence ethically and legally. When SCIP was the voice of competitive intelligence, it had a code of ethics for everyone to work under. Not sure who to turn to now, but here is some advice on staying on the right side of the line:
Ethical Competitive Intelligence
Monitoring competitors’ strategies is smart for your business. However, unethical or illegal methods will lead to reputational damage and legal troubles. It’s important to understand the boundaries of ethical competitive intelligence. Legal and ethical tracking of competitors helps gain valuable insights without resorting to underhanded tactics. Read more: Market Surprise is Reduced With Competitive Intelligence.
When Competitive Intelligence Crosses the Line
Unethical competitive intelligence usually involves accessing non-public information. It often violates competition law and trade secrets. This isn’t competitive intelligence; it’s corporate espionage. Practices like bribing employees, hacking, or digging through bins are illegal and unethical. Avoid these tactics at all costs to maintain integrity and avoid legal consequences.
Avoiding Legal Pitfalls When Hiring from Competitors
You can unintentionally cross the line even if you avoid obvious illegal activities. When hiring from a competitor, ask the candidate if they have signed a non-disclosure (NDA) or non-compete agreement. These agreements prevent them from sharing confidential information or working for competitors for a period. Request copies of any signed agreements to understand the restrictions in place. Failing to do so could result in legal action from your competitor. Read more: What is a benchmark analysis? The Power of Competitive Benchmark Analysis.
Preventing Accidental Data Security Breaches
New hires may accidentally bring confidential information from their previous job on their devices. Ask if they have any documents or data from their old job on their devices. This practice is a security risk and can lead to accidental breaches. 90% of security breaches result from human error. It’s our responsibility to prevent them. It is good business practice to take reasonable steps to prevent a breach. Ensure new employees securely dispose of any confidential information from their previous employer.
Leveraging Primary Research
Primary research can also provide valuable insights that aren’t publicly available. Surveys, interviews, focus groups, and the like can all yield a deep understanding of markets, customer preferences, and competitor strategies. Never pay a person for information. Pay them for their time; if they choose to reveal insight, that’s up to them. Focus on legitimate firsthand information to gain unique insight without compromising ethics. Read more: What are the main points of competitors analysis?
Keeping Competitive Intelligence Ethical (And Legal) in 2024 and beyond
Competitive intelligence is vital for staying ahead but must be done ethically. By relying solely on publicly available information and ethically conducted primary research, you can gain valuable insights without risking reputational damage or legal troubles. It can allow you to improve your strategy and competitive advantage or improve your social media strategies. Stay ethical, stay informed, and stay ahead.
We are Octopus. The Global People-Powered Competitive Intelligence Agency.
Outsmart your competition. Make the unknown known. Octopus helps you gain clarity in complex markets. With clients and tentacles around the world, we deliver sharp, actionable competitive intelligence through a blend of deep primary (HUMINT) and secondary research. If you’re looking to make smarter decisions, beat the competition, and reduce uncertainty, we’re the partner you want on your side.
