Lack of Imagination Problem in Intelligence
Some underrate their competitors because they lack the imagination to envision what they may become. Only getting worse when we outsource our thinking to ChatGPT and Claudie.
“Imagination is the beginning of creation.” — George Bernard Shaw
Your competitor is small, with limited resources and a narrow focus. You may have analysed them and understand the constraints they work within. You know what they can’t do. Specifically, they can’t compete at the higher end of the market. They can’t develop enterprise features; they cannot afford to have a global team. They can’t match your brand. Competitive Intelligence platform logged. Case closed. They didn’t even get a Strengths and Weaknesses matrix.
You have decided your competitor doesn’t pose a real threat. You have classified them as a minor player and therefore assigned only minimal defensive resources.
You have also given up picturing what they might become. We have resisted wheeling out the well-known Nokia example…
What could achieve in three years?
What could a small, well-focused competitor achieve in the next three years if it made decisions completely different from what you would expect?
In the real world, most intelligence analysis relies on extrapolation. For instance, if competitors have acted in a particular manner, they will continue to do so. If they have focused on a particular market segment, they will remain in it. If they have used a particular business model, they will stick to it.
You end up making your predictions based on patterns, while your competitors rely on imagination.
The Constraint Breakthrough
Constraints stimulate the imagination. But since your competitor has these limited resources, they come up with creative solutions. Because the market is small, they look at adjacent markets. With limited technology, they consider alternative architectures.
Because you have many resources, you think only in terms of small improvements. With a big market, you believe you should scale up your current method. And because your technology is well developed, you think only in terms of adding new features. Think backwards too.
When imagination is restricted, it leads to breakthroughs; when it is abundant, it results in incremental advances.
The Path Nobody’s Taking
Intelligence analysis tends to ask, ‘What are our competitors currently doing?’ rather than asking, ‘What might our competitors do if they made different choices?’ We never get asked this question.
Your competitor may move upmarket by partnering rather than developing their own solutions. They could expand globally by franchising rather than by running their own operations. They may compete on price by using AI rather than employing people. They might even develop enterprise features by acquiring specialised software.
They are not impossible. They do not require resources they do not possess; they only need imagination to find alternative routes.
The Blind Spot Problem
Because of what they can see, analysts are limited. Especially when you focus on the next set of tactical intelligence questions your board demands. Competitors, meanwhile, are not limited; they can achieve more. When you see a small competitor, you may judge them to be small, but they see an opportunity and imagine themselves as large.
Your analysis focuses on what competitors can’t do, while they’ve built their strategy on what no one else thinks of.
Disruption exists in the gap between your analysis and their imagination.
When Competitors Escape Categories
As soon as a competitor thinks it possible to move out of their current category, your analysis is no longer valid. You have seen them as a firm focused on a niche market. If they decide to become mainstream, then your view of them as an enterprise-only company is outdated. When they consider adopting a consumer-first approach, your perception that they are direct sellers becomes incorrect. They envisage offering a self-serve option.
The change happens in imagination before it happens in reality; by the time it becomes real, you’ve probably already lost your way.
Why Imagination Matters in Intelligence
The genuine competitive threat does not lie in what competitors are currently doing. It is based on what they can imagine doing. Not something that their present resources permit, but something that their imagination can conceive.
Certain competitors will always remain limited by their present resources and the existing market; they will continuously improve their position in the niche. Others, on the other hand, will imagine themselves breaking out.
The question is this. Are you looking at the constrained one or the imaginative one? Your analysis directs attention on the constrained one, while their strategy focuses on the imaginative one.
The Creativity Tax
Imagination needs to be given the chance to fail. It needs the right to try out things that do not fit into the current category, the right to put its money where its mouth is when it comes to future possibilities, and the right to break its own rules.
Organisations rarely grant permissions of this kind. As a result, competitors remain bound by organizational inertia. However, competitors do grant permission—that is, those imagine themselves breaking free and up becoming a threat.
Scenario Imagination
True intelligence involves asking what we would do if we were in their position. Not what we would do using their resources, but what we would do given their constraints? And what are we not currently imagining?
What would a small competitor, having only limited resources, build? The answer is likely something entirely different from what you are building when you have abundant resources.
The Competitor You’re Missing
The one you should fear most is the competitor with plenty of resources to come up with a new idea, but not so many that their existing systems hold them back. They are free to imagine and can put their ideas into action.
You most likely aren’t keeping an eye on them since they haven’t been successful yet. Imagining something without carrying it out is merely theory, but add execution to imagination, and you get disruption.
Question to consider
What would happen to your smallest competitor if they made three completely different strategic choices than you expect, and would you be ready to compete with them five years from now?
Practical Advice
Run a quarterly “imagination audit” for each main competitor. Instead of wondering what they’re doing now, ask what they might do. Take their key capability and then imagine five entirely different applications for it.
Also imagine five different business models they could adopt and five different customer segments they could target. For each of these ideas, ask yourself: How would we react if they pursued that course? If you can’t answer, you have a weakness. Develop defences accordingly.
Create a “scenario imagination” exercise. Bring together your strategy team and assign each member the role of a competitor. Provide them with that competitor’s resources and limitations. Ask them to develop a strategy that is entirely different from the one the competitor is currently following.
- What would they develop?
- What would they target?
- Where would they move to?
The responses will show you the kinds of moves your competitor might make that you are not prepared for, and you should use them to increase your strategic flexibility.
Stop analysing what competitors are doing and start imagining what they could do. When analysts present intelligence, ask: “What could they do that we’re not expecting?” Force teams to imagine competitor breakouts before they happen.
Build defences against imagined threats, not just current threats. Most competitors become dangerous in the space between imagination and execution. Close that gap before they do.
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