Competitive Intelligence Process and Strategic Performance of Banking Sector in Pakistan

Full text

Int. J. Business Information Systems, Vol. X, No. Y, xxxx 1
Copyright © 20XX Inderscience Enterprises Ltd.
Competitive intelligence process and strategic
performance of banking sector in Pakistan
Nadia Hanif*
University of International Business and Economics,
Beijing , China
Email: nadiahanif77@yahoo.com
*Corresponding author
Noman Arshed
Department of Economics,
University of Management and Technology,
Lahore, Pakistan
Email: noman.arshed@umt.edu.pk
Hasan Farid
University of International Business and Economics,
Beijing, China
Email: Hassaanfarid3@gmail.com
Abstract: Resource-based view (RBV) and knowledge-based view (KBV) of
the firm are the key viewpoints of strategic planning for accomplishment of
superior strategic benefits and sustainable competitive advantage via creating
valuable competencies. Competitive intelligence (CI) process is a mechanism
to achieve superior long-term strategic performance leading to sustainable
competitive advantage under the umbrella of RBV and KBV. This study
surveyed 200 banking officials from Lahore, Pakistan using the questionnaire
which was pre-tested for validity both face and content. The instruments used
in the questionnaire successfully converged to desired latent variables entitled
as strategic performance, planning and focus, information gathering, analysis,
communication, cultural awareness and process structure. The results
showed that all the components of CI process significantly affect the strategic
performance of the banks. Top management may consider the implementation
of formal CI unit as this study concluded a positive significant impact of CI
process on strategic performance of banks. In addition, banks top management
can organise CI awareness programs which can improve participation of
employees at all phases of CI process.
Keywords: competitive intelligence process; culture and awareness; process
and structure; strategic benefits; simultaneous equation model; SEM; Pakistan.
Reference to this paper should be made as follows: Hanif, N., Arshed, N. and
Farid, H. (xxxx) ‘Competitive intelligence process and strategic performance
of banking sector in Pakistan’, Int. J. Business Information Systems, Vol. X,
No. Y, pp.xxx–xxx.

2 N. Hanif et al.
Biographical notes: Nadia Hanif is a PhD scholar in the Department of
Business Management, University of International Business and Economics,
Beijing, China. She has earned her MS in Commerce from University of the
Punjab. Her interests include technology innovations, institutions and cross
border mergers and acquisitions in the domain of strategic management,
international business and economics.
Noman Arshed is a Lecturer of Economics at University of Management and
Technology Pakistan. He received his MS in Economics from the University of
Edinburgh, UK. His research interests include econometrics, business
economics, development economics and Islamic economics.
Hasan Farid is a PhD scholar in the Department of Business Management,
University of International Business and Economics, Beijing, China. His area
of interest is cross-cultural human resources and expatriate management system
in international business
1 Introduction
Competitive intelligence (CI) process is a method to measure the competitive advantage
and the performance of a business which comprised of a complete mechanism involving
different phases. CI is an emerging concept in all the business fields and increasingly
acquiring attention all over the world. Meyer (1991) stated “successful business
enterprises have been collecting and using intelligence for centuries but what
differentiates early efforts from those at present is the organized nature of modern CI
process.” Most of the countries are market-based economies where CI is arising as an
international practice. CI is a non-military method to guarantee prosperity and national
peace. In early CI practices Israel, Japan, the USA and Sweden were the leaders. Japan
has been known as a pioneer in maintaining sensitive business information and
innovative technologies over many years. The Japan External Trade Organization is
recognised as an active entity in gathering economic and industrial intelligence. In past
literature, Sweden is frequently prioritised as being a principal country in CI and has a
strong organised CI culture (Calof and Skinner, 1998). Many small Swedish international
organisations collect information towards an effort in intensifying the general competitive
position. According to Global Intelligence Alliance (GIA), Sweden’s banks participate
openly and confess their responsibility in CI race alongside the Swedish Government and
embassies all over the world. In many countries, such as Mexico and Brazil, CI has been
used as a business instrument since the late 1990s. CI implementation has many direct
and indirect advantages. The direct advantages of CI process include: obtaining valuable
information, avoiding redundant information, managing and diminishing the risk,
employing information strategically, transforming information into unique and reliable
knowledge (Myburgh, 2004; Ponis and Christou, 2013). The indirect advantages of CI
process entails: exploiting business opportunities, highlighting important problems to
secure business expansion, speeding up the internationalisation via accelerating new
market opportunities, soliciting the strategies of the competitors, ensuring long-term
survival of the business, enabling improved interpretation of external environment and
assessing customer expectations effectively (Brody, 2008; Guimaraes, 2000; Shih et al.,
2010).

Competitive intelligence process and strategic performance 3
Developing economies suffer from continuous unexpected and undesirable changes
owing to which organisations in such economies could not be able to manage a formal
system to generate knowledge (Nasri, 2011). McGangole (1996) argued that CI is
working as a ‘latest weapon in the world war of economics’ and in this war, almost all
economies consider CI as an instrument to prevail economic hostilities against more
industrialised and developed countries. Calof and Smith (2010) stated that, without a
proper setup of CI infrastructure, a country cannot perform efficiently. According to
Prescott and Gibbons (1993), the main problem in CI implementation is the availability
of complete structure and a system. Further goals and techniques being highlighted
as other obstacle proposed by governments such as Canada, Japan, Sweden and
France (Prescott and Gibbons, 1993). These countries recognised the importance of
industry-government collaborative workings for the development of supportive CI
culture. The term ‘CI’ is not a new business activity in developed economies. However,
its establishment in the developing economies has grown over the last few years to
become an emerging business construct (Heppes, 2006). There have been a number of
studies conducted on banking sector of advanced countries regarding CI process
implementation witnessed in past literature (Armstrong, 2007; Hawkins, 2004; Kahaner,
1997; Pellissier and Kruger, 2011). However, few studies have been found in the context
of developing countries banking sector. Same as other industries banks in Pakistan also
required to plan and implements strategies. Although banks may use a combination of
approaches to stay one step ahead of competitors that can assure their long-term survival.
In this study, we applied resource-based view (RBV) which interprets resources of an
organisation to examine its sustainable competitive advantage, and knowledge-based
view (KBV) which interprets knowledge is the most strategically important part of the
firm’s resources (Grant, 1996).
CI process with the RBV and KBV can achieve sustainable competitive advantage
and superior strategic benefits, in which banks plan and develop intelligence objectives,
collect information to achieve those objectives, analyse the collected information and
disseminate the newly transformed information (knowledge) to the relevant personals
through supportive inimitable, unique and rare structure and culture. Considering CI
process via RBV and KBV not only help the banking sector to effectively deal with the
local and international competition but can also support the banks in attaining a high
share in the market. Under the umbrella of RBV and KBV, CI process preferably ought
to be a formalised (official) activity performed by a committed CI division which should
be tactically located in the corporation (Gilad and Gilad, 1985a). CI process needs proper
procedures, policies and a formal or informal infrastructure so that employees can add
efficiency to the CI activities and obtain information from the process. Since a formal CI
process shaped with a combination of a system, structure, knowledge and diverse people
which when combined strategically, turned into non-substitutable competencies, cannot
be easily copied by any other bank. RBV, KBV and past CI literature supported the
systematic approach and formal structure of CI process to achieve competitive advantage
(Cleland and King, 1975; Cox and Good, 1967; Gilad and Gilad, 1985b; Porter, 2008).
Several studies have been conducted to examine CI activities by means of explanatory
and descriptive methods in many developed and developing countries. Whereas, little
research has been done on the application of CI process through a mechanism in
developing countries (Du Toit, 2013). Ahmed et al. (2014) showed that CI process is
significantly important to gain marketing effectiveness. They took competitor risks,

4 N. Hanif et al.
market opportunities, technological intelligence, competitor threats and strategic
intelligence as sub-measure of CI process and concluded that all the sub-indicators of CI
are significantly important for effective marketing (Ahmed et al., 2014).
This study investigated the process of CI while focusing structure, culture and
awareness as pre-cursor of CI process and the four factors including planning and focus,
information gathering, analysis and dissemination of new knowledge as stages of CI
process in the banking industry of Pakistan. This is the first study to the best of our
knowledge in which we investigated CI process stages through a process and its impact
on strategic performance of banking sector of Pakistan under the umbrella of RBV and
KBV as a source to achieve sustainable competitive advantage and strategic benefits. A
structured questionnaire was used to conduct the survey. In developing countries such as
Pakistan, banks are facing competition from local banks as well as international banks. CI
process formal application provides an edge to local banks to maintain and assure their
sustainability through legally implementing the CI process in the form of a unit. In
addition to strategic benefits, CI also ensures long-term continuance of the business.
We begin by reviewing the literature on CI factors and their impact on firm
performance while discussing hypothesis. Secondly, we discussed the theoretical
framework of CI process allied with past literature, RBV and KBV of the firm. Next, we
explain the research design and methodology adopted for the study. Finally, we discussed
the results of the study and concluded with its theoretical and managerial implications.
2 Literature review
According to López-Robles et al. (2019, p.22) “the critical factors in the big data era are
collection, analysis, and dissemination of information to improve an organization’s
competitive position and enhance its products and services.” Chawinga and Chipeta
(2017) demonstrated that knowledge management (KM) and CI collectively affect the
success of an enterprises and its competitive position.
Heppes (2006) found that CI system in South American retail banks has turned into a
formal activity. Pellissier and Kruger (2011) found that executives of the developing
economies encountered by the unexpected dynamic environmental changes because they
were not conducting scanning activities. Which were interpreted as the main reason that
the top executives are unaware regarding the importance of CI supportive organisational
structure for implementation of CI process. On the other side, the collection of
information must be an organisation-wide activity (supportive organisational structure)
(Kahaner, 1996). Fulad (1994) stated that owing to the strong global competition, the
profusion of information, volatile market conditions and the rapid velocity of the varying
business environment the world has turned out in to a global village. Companies are
looking for new approaches to gain long-term CI advantages through aggressive
competition strategies. While CI strategies are frequently used by most of the companies
in the USA such as Texas Instruments, Citi Corp., IBM Corp., US Spirit, Douglas Corp.,
AT&T Inc. and McDonnell. But there is a need for proper procedures, policies and
formal or informal settings so that all the factors of CI process can effectively be
incorporated in the system. Which allow organisations to utilise CI procedure to achieve
maximum and comprehensive output. Most of the firms manage CI activity as a
short-term project and do not maintain a systematic ongoing CI unit, which is an
indication of an informal CI process (Prescott and Smith, 1987). Köseoglu et al. (2018)

Competitive intelligence process and strategic performance 5
found that many departments including operations, tactical and strategic in hotel industry
practice informal CI activities in their daily routines. There is no centralised unit for CI
process implementation which may focus on planning, information gathering, data
analysis and communication of final findings. Huge development in infrastructure is
needed in information services and systems to achieve strategic CI monitoring structure.
This could not only assist organisations to achieve high share in the market but also allow
to efficiently compete with the international competition (Pellissier and Kruger, 2011).
Without an appropriate structure which supports CI stages including planning, gathering,
analysing and interpreting, it is difficult for a bank to implement CI process. The review
of the literature suggests the following hypothesis regarding supportive structure for CI
process:
H1 Does the structure of banks positively impact the components of the CI process?
The firms may effectively utilise CI process stages including planning, collection,
analysing and dissemination of intelligence information within its environment. For that
firm should have an appropriate awareness of CI process and intelligence culture at the
organisational and individual level. Wall (1974) stated that a company should have
internal wisdom of competitiveness so that it can achieve the maximum effectiveness of
the intelligence unit. Researchers highly supported awareness and culture to collect
information in the marketing area, specifically, in services marketing (Gelb et al., 1991;
Ghoshal and Westney, 1991; Kohli and Jaworski, 1990; Pole et al., 2000; Slater and
Narver, 2000). The most important element is awareness (which may construct the CI
existence within a firm) of a company’s competitive environment which is one of the
foundations of organisational learning theory. The implementation of ethical standards
and behaviour is also embedded in organisation culture (Beltramini, 1986; Cohen and
Czepiec, 1988; Hallaq and Steinhorst, 1994; Jones and Bryan, 1995). By analysing the
importance of awareness and culture for CI process, we hypothesise that:
H2 Does culture and awareness positively impact the components of competitive the
intelligence process?
Magasa et al. (2014) concluded that the use of CI activities in small and medium
enterprises (SMEs) is a big push to enhance performance. CI process is the main source
of gaining knowledge about the customers, markets, opportunities and competitor’s
strategies. However, the most common benefits of CI process are its ability to build
information profiles that help a company in identifying its competitor’s strengths and
weaknesses, objectives, market positioning and likely reaction patterns (Bose, 2008);
shed light on competitor strategies (Westervelt, 1996); provide the basis for continuous
improvement (Babbar and Rai, 1993); improve the likelihood of company survival;
enhances market share (Darling, 1996); helps in acquisition of new ventures and to aid in
the understanding of external influences. Singh et al. (2012) explored the relationship
between CI practices and the performance of the firms and concluded that high levels of
CI activities employed to accomplish better financial performance. CI might be viewed
through the general business environment and competitor’s actions from publicly
available, non-proprietary data sources and translating that raw information into
knowledge which can be the ongoing process (Blenkhorn and Fleisher, 2005; Singh et al.,
2012). Waithaka (2016) concluded that CI practices have a positively significant effect
on the non-financial performance of firms whereas the insignificant positive impact on

6 N. Hanif et al.
financial performance. Stefanikova et al. (2015) stated that the effective use of
knowledge by an organisation can assist in achieving innovation and sustainable
economic growth. In addition, there is a significant relationship between the extent of CI
activity and trend in market share in the Slovak Republic (Stefanikova et al., 2015).
Maune (2014) highlighted CI as a process and a product. CI plays a role in market
analysis, customer relationship management, product innovation, customer profitability,
regulatory compliance, due diligence in mergers and acquisitions, risk management,
competitor analysis and performance budgeting. Adidam et al. (2012) concluded that
Indian firms which incorporate the high extent of CI practices showed high financial
performance which is totally opposite as argued by Waithaka (2016). Wright et al. (2009)
argued that top management in the UK banks vigorously supports the CI process, and
there is no explicit mechanism used by the UK banks to appraise CI information. Yin
(2018) examined the origin of CI process and its usage at the executive information
system phase to investigate the impact of CI on organisational performance and executive
information system. Yin (2018) used a questionnaire survey and argued that CI positively
impacts the organisation performance and influences decision making of not only at the
executive level but also at the organisation level. Markovich et al. (2019) defined
embeddedness of CI in a firm as the degree to which management and employees
integrate CI activities in daily routines, which consequently allow the actionable
knowledge transfer all over the organisation. They found that CI embeddedness have no
direct effect on the firms’ performance, it is mediated the influence of the customer
satisfaction on performance.
From the review of the above literature, the third hypothesis is formulated as:
H3 Do the components/phases (planning and focus, information gathering, analysis
and communication) of the CI process positively impact the strategic performance
of banks?
3 Theoretical framework
Strategic management recent contribution to the theories of the firm has been the RBV
(Barney, 1991; Mahoney and Pandian, 1992; Wernerfelt, 1984), which put forward that
the firm is a bunch of distinctive capabilities. In this perspective, it is the responsibility of
the manager to nurture these capabilities and position them in product and market
strategies to attain competitive advantage. The RBV proposed that inimitable, rare and
valuable capabilities of the company (Barney, 1991) establish a long-term competitive
advantage. RBV of the firm is one of the key viewpoints of strategic planning for
accomplishment of superior strategic benefits and sustainable competitive advantage.
Whereas, CI process is a mechanism and a technique which generate knowledge and
achieve superior long-term strategic performance leading to sustainable competitive
advantage. Banks can achieve sustainable competitive advantage by employing strategies
and policies to combine the available resources and capabilities in a way that it turned in
to competencies which becomes difficult to copy. Banks further use these combined
competencies into CI process to accumulate new knowledge under the rules of KBV.
Which in turn exploit the bank’s internal potencies by stimulating environmental
opportunities, diminishing and controlling internal weaknesses and external threats.

Competitive intelligence process and strategic performance 7
While focusing on the importance of firm specific competencies, the RBV has
concentrated significantly on intangible capabilities which are critical to achieve
competitive advantage. The focus on intangible assets and resources has directed to an
expansion of the RBV to the KBV of the firm. In this perspective, knowledge is the most
strategically important of the firm’s resources (Grant, 1996). KBV offers a fresh lens
through which we can understand the principal foundation for a firm’s survival in the
creation, exchange and implementation of knowledge (Demsetz, 1988; Grant, 1996;
Nonaka, 1994; Spender, 1996). Whereas, CI is a mechanism which combines various
tangible resources and competencies to generate knowledge from the transformation of
information with the help of human capital of the bank.
In CI process, banks collect information about the internal and external environment
such as about competitors, suppliers, customers, business processes, technology and
market’s innovations. Bank’s human capital further processes this information in CI
mechanism through a supportive internal organisational structure. Which enable a bank
to accumulate inimitable and unique knowledge that provide opportunities to maintain
sustainable competitive advantage and strategic benefits for long-term business
continuance. The encouraging structure in bank enables the CI process implementation
effective to generate knowledge through combining tangible and intangible resources
under RBV and KBV. Such uniquely processed knowledge becomes an idiosyncratic
bank’s intangible attribute (Porter, 1990). To achieve a sustainable competitive
advantage, a firm needed to develop and own a unique combination of resources and
attributes.
CI culture, awareness and attitudes refer to a peculiar company’s awareness and
knowledge regarding CI process. An encouraging culture is believed to be very crucial if
an organisation is planning to have the utilisation of its CI attempts effectively (Dishman
and Calof, 2007). For example, to guarantee that CI is performing well and that all the
employees must participate. There should be a true competitive ethnicity and information
gathering culture (e.g., it ought to be on everybody’s mind) (Kahaner, 1997). CI process
and structure means availability of proper procedures, policies and informal or formal
settings. So that employees be able to contribute their know-how and understandings
efficiently to the CI scheme, which enables an organisation to achieve maximum strategic
benefits from this activity (Dishman and Calof, 2007). Whereas, organisation’s structure
in the form of a system is necessary to guarantee efficient and effective execution of CI
(Kahaner, 1997). According to RBV and KBV, strong and efficiently managed tangible
assets (structure) and intangible (supportive culture and knowledge about CI activities)
resources can be able to implement and conceive the firm’s strategies. In this scenario,
structure and culture as pre-cursor of the CI process provide the basis for the application
of the whole CI process and make grounds of intelligence at the core of the business. The
informal or rather strategically formal structure and cooperative culture embedded in the
bank environment can provide a platform for implementation and effectiveness of the CI
process.
As discussed above CI process involves the creation of new competitive knowledge
which requires a unique merger of the firm’s different resources. According to RBV, all
the resources have been conveniently classified into three groups (Barney, 1991)
including human capital (Becker, 1994), physical capital (Williamson, 1975) and
organisational capital (Tomer, 1987) resources. Whereas KBV further refers to the

8 N. Hanif et al.
diverse knowledge-bases and skills among firms are the key determinants of efficiency
and productivity differences.
In order to generate new knowledge, intelligence project processes firstly includes
planning and focus such as considering issues of maximum significance to higher
management (Daft et al., 1988; Gilad, 1989; Herring, 1998). Secondly, it involves
information collection, for example gathering and compilation of information from a
number of channels external or internal environments (Collins, 1997; Herring, 1998).
Here, RBV contributes through physical resource-base of banks including geographical
location, technology, equipment and access to raw information. Whereas, KBV supports
banks not only use heterogeneous knowledge skills and capabilities in creating new
knowledge but also use different methods to access knowledge generated in the external
environment (DeCarolis and Deeds, 1999). In the third phase, the CI process includes
analysing the collected information using technology and equipment. For example,
translating information into ‘actionable intelligence’ upon which tactical and strategic
decisions could be geared up through insights, relationships, intelligence, judgement, and
experience by human capital resources (Barney, 1991; Gilad and Gilad, 1985a; Herring,
1998; Kahaner, 1996, 1997). According to KBV, the information transformed into new
competitive knowledge after analysis and when added to the existing knowledge-base, it
becomes accumulated knowledge. Knowledge accumulation efficiency is significantly
improved when knowledge can be articulated in terms of universal language so that it
may be communicated. Statistics is specifically a functional language for accumulating
(and transferring) forms of explicit knowledge; so that knowledge efficiency in this way
is significantly augmented through advancements in information technology. How the
knowledge can be efficiently transferred within the firm is the key discussion point
regarding KBV and knowledge in the form of ‘universal language’ can be easily
disseminated and communicated at all levels of banks. Fourthly, CI also involves
disseminating the transformed information after thorough analysis. For example,
compiling the results (accumulated intelligence knowledge) and communicating those
results obtained from the CI process to those human resources who holds the
responsibility and authority to implement the findings through the use of physical capital
and bank’s resources (Kahaner, 1997). These four phases are the standard stages of
intelligence process can be unique when complimentary with RBV and KBV as just
about the universal implementation of what is usually stated as the CI process.
Banks can use both formal and informal capital resources to implement the CI
process with the broader view of RBV and KBV. Considering CI process at the strategic
level and with the lenses of RBV and KBV, it is a significant process to achieve
a sustainable competitive advantage, improved customer-base, enhanced business
performance and strategic benefits. Based on the past literature, CI process, RBV and
KBV, in this study, authors are proposing the following theoretical model (Figure 1) for
potential strategic benefits of the CI process. This model is adapted from past studies
(Barney, 1991; Dishman and Calof, 2007; Nasri, 2012; Viviers et al., 2005). The CI
practices influence the profitability of banking sector as concluded from banking
employees who were involved in offering daily banking services to customers (Ngugi
et al., 2012). CI process could be used by an organisation to ensure customer’s repeated
buying behaviour. By focusing on the information collected through intelligence
activities, the managers could consider different approaches of the marketing mix (Nasri,
2012). Which in turn differentiation in marketing mix creates new markets avenues, and
also fuel the growth in terms of increase in sales and market share (Safarnia et al., 2011).

Competitive intelligence process and strategic performance 9
CI process implementation advantages arose through knowing customer’s prospective
needs and buying behaviours that assist in offering novel services and products (Cottrill,
1998; Marin and Poulter, 2004). Which cause the banks in avoiding the unnecessary
procedural cost (Nasri, 2012). In addition, CI could help in a well-organised resource
distribution and consequently result in profitable investments (Herring, 1996), such as
marketing differentiation, innovation, new market search, and customer satisfaction
(Nasri, 2012). Only a formal and well-established intelligence unit can release in time
intelligence information (knowledge) to the decision makers so that they can take right
actions at the right time. Strategic performance investigates continuous strategic
improvement as a ‘feedback’ in the CI process (Bose, 2008; Darling, 1996).
Figure 1 CI process and its impact on strategic performance of banks
intelligence Process and its impact on Strategic Performance of Banks
Process and
structure
Culture and
awareness
Competitive intelligence
components
-Planning and focus
-Information gathering
-Analysis
-Communication
Strategic performance
Overall strategic Performance
(financial, marketing, strategic
planning, technological
improvements, innovation and
improved internal system) of
banking sector
4 Methodology
In this section, the methodology will be specified for the theoretical model specified
earlier. This methodology will then be followed for the estimation of the model to answer
the research questions.
4.1 Model
The stochastic form of the theoretical and conceptual model is provided below where the
random error is allowed for using residual terms μ1i to μ5i as shown by Fornell and
Bookstein (1982). All the variables mentioned in equations are explained in the variable
section.
i 1 11 i 12 i 13 i 14 i 1i
PERF PF IG ANA COMM μ=  +  + +  + +
(1)
i 2 21 i 22 i 2i
PF PS CA μ=  +  +  +
(2)
i 3 31 i 32 i 3i
IG PS CA μ=  +  + +
(3)
i 4 41 i 42 i 4i
ANA PS CA μ=  +  +  +
(4)
i 5 51 i 52 i 5i
COMM PS CA μ=  +  +  +
(5)

10 N. Hanif et al.
4.2 Population and sampling
4.2.1 Defining the target population
The target population for this study was commercial and Islamic banks’ employees
in Lahore, Pakistan. Out of total 27 commercial banks including five public and
22 domestic private commercial banks and five Islamic banks operating according to SBP
that exist in Lahore city till 31st December 2017. The banks were selected on the basis of
random strata including public, private domestic, commercial and Islamic banks.
4.2.2 Sample construction
Data was collected from the employees of banks who are working at top positions
including branch managers (34%), operations managers (28.5%), area managers (4%),
customer relations manager (5%), chief manager (2.5%), vice president (2%), regional
branch manager (2%) and others (18%). A total sample size of 200 employees was
collected using the stratified random sampling technique. In his study, Yin (2018)
concluded the impact of CI on strategic performance through analysis of 126 executive
responses. In our sample, 68.5% of the respondents hold master’s degree, 16.5% and 15%
of respondents had a higher qualification and bachelor’s degree, respectively. It was not
possible for researchers to attend the whole population; therefore, they applied stratified
random sampling technique to collect data from banks including public, commercial,
domestic private and Islamic, which ensured the response from each category of bank
declared by SBP. Through this way, researchers achieved the variety and representation
from employees working in the banking sector of Pakistan to explore the CI process
and its impact on strategic performance. In addition, the banking processes are all
homogenous among the type of banks irrespective of banks working in Lahore or any
other city owing to online and offline banking services which forced them to be similar
and synchronised even not only in Pakistan but also in the provision of services globally.
Table 1 Variables and their measurements
Variables
Full name
Measurement
PERF
Strategic performance index
Qs. no. P1, P2, P3, P4, P5, P6, P7, P8, P9, P10, P11
CA
Culture awareness index
Qs. no. CA1, CA2, CA3, CA4
PS
Process structure index
Qs. no. PS1, PS2, PS3, PS4, PS5
PF
Planning focus index
Qs. no. PF1, PF2, PF3, PF4
IG
Information gathering index
Qs. no. IG1, IG2, IG3, IG4, IG5, IG6
ANA
Analysis index
Qs. no. A1, A2, A3, A4, A5, A6
COMM
Communication index
Qs. no. C1, C2, C3, C4, C5

Competitive intelligence process and strategic performance 11
4.3 Questionnaire development
A questionnaire was mainly adapted from Ain (2013), Du Toit (2013), Muller (2004),
Nasri (2012), Viviers et al. (2005), Wright and Calof (2006) and Wright et al. (2009),
initially consisting of 63 questions which trimmed to 41 items in validity test (the
finalised questions are shown in Table 1). The questionnaire was based on seven points
Likert scale from strongly disagree 1 to strongly agree 7. It took 25 minutes to fill the
questionnaire.
5 Results
5.1 Reliability and validity tests
Conventional reliability or internal consistency is checked using Cronbach (1971) alpha
test. Table 2 shows all the constructs within the latent variables have sufficient
variability. Face validity checks whether the constructed questionnaire is appropriate as
compared to study objectives. This appropriateness includes readability, formatting and
language clarity (DeVon et al., 2007). Since the questions used in the study was adapted
from literature, its face and content validity was ensured through discussion with the
participants and experts opinion (Burns, 1996; Salavati et al., 2017). Convergent validity
shows that how well the constructs are correlated with the latent variable. Since all the
values of AVE are above 50% in Table 2 and the cross-loadings are above 0.7 threshold
for all cases and the significant T-values shown in parenthesis confirm their significance
as shown in Table 3 respectively, this indicates that there is convergent validity
(Diamantopoulos and Winklhofer, 2001).
Table 2 Reliability test
Cronbach’s
alpha
rho_A
Composite
reliability
Average variance
extracted (AVE)
Analysis
0.88
0.88
0.91
0.63
Communication
0.89
0.90
0.92
0.7
Culture awareness
0.83
0.83
0.89
0.66
Information gathering
0.90
0.90
0.92
0.66
Performance
0.94
0.94
0.95
0.62
Planning focus
0.86
0.86
0.90
0.7
Process structure
0.87
0.88
0.90
0.65
Discriminant validity checks whether constructs in a particular latent variable are
more related to that latent variable as compared to other latent variables. Since, in the
cross-loadings of the constructs with relevant latent variables are higher and significant as
compared to other latent variables, also the values of Fornell and Larcker (1981)
condition is greater than the correlation values (Table 3). This confirms discriminant
validity as these constructs from a clean group with a particular latent variable.

12 N. Hanif et al.
Table 3 Validity test
Analysis
Communication
Culture
awareness
Information
gathering
Performance
Planning
focus
Process
structure
A1
0.78
(26.38)
0.63
0.72
0.76
0.69
0.69
0.66
A2
0.84
(34.38)
0.44
0.67
0.62
0.65
0.53
0.51
A3
0.82
(26.59)
0.54
0.63
0.68
0.78
0.46
0.65
A4
0.8
(23.42)
0.56
0.65
0.74
0.68
0.59
0.6
A5
0.72
(17.45)
0.6
0.61
0.53
0.56
0.47
0.48
A6
0.79
(23.08)
0.48
0.65
0.65
0.54
0.56
0.56
C1
0.56
0.88
(67.59)
0.7
0.62
0.68
0.6
0.56
C2
0.69
0.82
(37.92)
0.75
0.72
0.67
0.67
0.61
C3
0.54
0.88
(64.10)
0.63
0.65
0.67
0.67
0.68
C4
0.53
0.8
(23.34)
0.6
0.65
0.55
0.71
0.66
C5
0.54
0.8
(24.49)
0.53
0.54
0.58
0.67
0.6
CA1
0.69
0.77
0.82
(40.48)
0.69
0.68
0.72
0.69
CA2
0.77
0.69
0.87
(64.08)
0.7
0.66
0.67
0.69
CA3
0.66
0.55
0.76
(22.03)
0.71
0.52
0.66
0.68
CA4
0.55
0.46
0.8
(24.84)
0.67
0.52
0.63
0.54
IG1
0.6
0.55
0.71
0.83
(33.82)
0.57
0.7
0.66
IG2
0.64
0.62
0.7
0.89
(47.77)
0.68
0.67
0.74
IG3
0.7
0.53
0.6
0.79
(26.07)
0.71
0.49
0.55
IG4
0.73
0.55
0.72
0.78
(21.26)
0.65
0.67
0.68
IG5
0.75
0.77
0.79
0.83
(42.39)
0.76
0.77
0.68
IG6
0.68
0.66
0.65
0.75
(19.99)
0.68
0.5
0.67
P1
0.64
0.68
0.67
0.74
0.79
(22.04)
0.6
0.59

Competitive intelligence process and strategic performance 13
Table 3 Validity test (continued)
Analysis
Communication
Culture
awareness
Information
gathering
Performance
Planning
focus
Process
structure
P2
0.63
0.46
0.63
0.76
0.71
(11.01)
0.62
0.59
P3
0.63
0.42
0.42
0.5
0.71
(11.02)
0.34
0.31
P4
0.64
0.61
0.6
0.67
0.86
(50.88)
0.44
0.42
P5
0.67
0.67
0.6
0.77
0.83
(21.55)
0.5
0.72
P6
0.75
0.68
0.7
0.7
0.86
(34.56)
0.57
0.51
P7
0.59
0.64
0.6
0.65
0.79
(24)
0.57
0.5
P8
0.64
0.65
0.53
0.5
0.7
(13.34)
0.41
0.38
P9
0.63
0.61
0.47
0.62
0.79
(23.41)
0.43
0.57
P10
0.76
0.59
0.64
0.69
0.82
(28.63)
0.51
0.49
P11
0.6
0.47
0.49
0.6
0.8
(32.7)
0.4
0.38
PF1
0.58
0.74
0.63
0.6
0.57
0.79
(30.13)
0.62
PF2
0.52
0.71
0.6
0.64
0.53
0.82
(30.24)
0.58
PF3
0.61
0.59
0.72
0.67
0.48
0.86
(42.14)
0.57
PF4
0.62
0.62
0.81
0.71
0.51
0.89
(37.57)
0.67
PS1
0.72
0.71
0.83
0.74
0.63
0.75
0.82
(38.19)
PS2
0.6
0.56
0.63
0.71
0.56
0.58
0.83
(33.51)
PS3
0.53
0.49
0.62
0.58
0.42
0.53
0.8
(25.85)
PS4
0.46
0.58
0.51
0.63
0.46
0.38
0.79
(25.55)
PS5
0.6
0.62
0.61
0.62
0.47
0.65
0.8
(27.29)
5.2 Estimation model
This study has used the structure equation model in Smart PLS to estimate
equations (1)–(5) simultaneously. The reason for this is that all equations are related to
the same individual decision maker in the banking business; hence, if there is any change

14 N. Hanif et al.
to the decision making of the individual, it will affect all equations at the same time, thus
estimating equations simultaneously will help to incorporate these dynamics and correct
the coefficients accordingly. These models are adopted from the simultaneous equation
model (SEM) which was based on the idea that sometimes equations do seem unrelated
to each other, but when we analyse the effect of a shock to equations, we will note that
they are inter-related (Zellner, 1962, 1963; Zellner and Huang, 1962). For the case of
survey-based studies in finance, SEM in which Smart PLS provides a flow diagram
mechanism to construct the model to estimate and provide equation level goodness of fit,
direct and indirect effects (Enders et al., 2006; Rabe-Hesketh et al., 2004; Wooldridge,
2010). The following diagram (Figure 2) shows that the process structure and culture
awareness effects planning focus, information gathering, analysis and communication
which in turn impact the strategic performance.
Figure 2 SEM model
0.790
0.806
0.635
0.697
0.699
Culture
awareness
Process
structure
Planning focus
Information Gathering
Analysis
Communication
Performance
0.18 (0.04)
0.36 (0.21)
0.34 (0.11)
0.19 (0.04)
0.67 (0.52)
0.57 (0.51)
0.67 (0.52)
0.49 (0.24)
–0.31 (0.15)
0.43 (0.20)
0.41 (0.25)
0.38 (0.25)
Information gathering
Notes: Parentheses show f2 and path coefficients.
Circle shows R2.
5.2.1 Estimation results
Table 4 shows the structural equation model SEM estimates of equations (1)–(5).
In equation (1) which has the performance as the dependent variable and all the
pre-requisites of CI as independent variables shows that all the significant variables show
a positive impact on the performance except planning and focus, Waithaka (2016) argued
that CI practices have a positively significant effect on the non-financial performance of
firms. Here, 1 unit increase in the information gathering index, analysis index and
communication index shows 0.44 unit, 0.42 unit and 0.38 unit increase in the
performance, respectively, keeping other factors constant. In their study, Singh et al.
(2012) concluded that Indian firms which show high levels of CI activities really

Competitive intelligence process and strategic performance 15
accomplish better financial performance results. While 1 unit increase in planning focus
index decreases performance by 0.32 units this may be because for the case of the
banking sector where there are SOPs for operations, here planning for extra might lead to
inefficient usage of time. Here R-squared of 0.81 shows that these independent latent
variables collectively explain the 81% of the change in the performance of the individual,
which is the role of quantified framework CI in explaining performance. For the case of
size effects, where f2 value less than 0.1 shows small size effect, between 0.1 to 0.3 are
moderate size effect and more than 0.3 shows strong size effect. For the case of
performance model, all the variables have a moderate effect.
Table 4 Coefficient estimates
Variable
Coef. (std. error)
T (P > |t|)
f2
Model 1 – dependent variable – performance
PF
–0.32 (0.06)
–5.01 (0.00)
0.15
IG
0.44 (0.06)
7.21 (0.00)
0.20
ANA
0.42 (0.04)
5.69 (0.00)
0.25
COMM
0.38 (0.04)
8.61 (0.00)
0.25
R-squared
0.81
Model 2 – dependent variable – PF
PS
0.19 (0.05)
3.65 (0.00)
0.04
CA
0.68 (0.05)
14.42 (0.00)
0.52
R-squared
0.69
Model 3 – dependent variable IG
PS
0.36 (0.03)
10.50 (0.00)
0.21
CA
0.57 (0.04)
16.02 (0.00)
0.51
R-squared
0.78
Model 4 – dependent variable ANA
PS
0.19 (0.05)
3.88 (0.00)
0.04
CA
0.67 (0.04)
16.17 (0.00)
0.52
R-squared
0.70
Model 5 – dependent variable COMM
PS
0.34 (0.04)
9.58 (0.00)
0.11
CA
0.49 (0.04)
11.54 (0.00)
0.24
R-squared
0.64
Indirect effects on performance
PS
0.31 (0.04)
7.08 (0.00)
CA
0.51 (0.04)
11.51 (0.00)
Sample size
200
In equation (2) where the planning and focus is dependent to process structure and
cultural awareness have been estimated. 1 unit increase in the process structure index and
cultural awareness index significantly increased planning and focus index by 0.19 unit
and 0.68 unit, respectively. These two variables collectively explain 69% of the change in

16 N. Hanif et al.
the dependent variable as depicted by R-squared. Here, process structure has small while
culture awareness has a strong effect.
In equation (3) where the information gathering index is dependent and the process
structure and cultural awareness indices are independent. 1 unit increase in the process
structure index and cultural awareness index increases the information gathering index by
0.36 unit and 0.57 unit, respectively. These two collectively explain 78% of changes in
information gathering index. Here, process structure has moderate and culture awareness
has a strong effect.
In equation (4) where the analysis index is a dependent variable and the process
structure and cultural awareness indices are independent. It is shown that 1 unit increase
in the process structure index and cultural awareness index increases analysis index by
0.19 unit and 0.67 unit, respectively. These two collectively explain 70% of the changes
in the analysis index. Here, process structure has small while culture awareness has a
strong size effect.
In equation (5) where the communication index is dependent to process structure and
cultural awareness index, 1 unit increase in the process structure index and cultural
awareness index increases communication index by 0.34 unit and 0.49 unit, respectively.
While they contribute 64% changes in the communication index. Here, both process
structure and culture awareness had a moderate size effect.
Following is the SEM structure in which we can see that process structure and
cultural awareness index do not directly influence the performance index, but SEM does
provide the marginal indirect impact. Here, we can see that 1 unit increase in the process
structure and cultural awareness index significantly increase the performance index by
0.31 unit and 0.51 unit, respectively. In Figure 2, all the path coefficients are statistically
significant as shown in Table 4 while the relevant f2 values are mentioned in the
parenthesis. The R2 of each model is mentioned in the circle of each dependent latent
variable.
6 Discussion and conclusions
This study is an attempt to identify the strategic benefits of using CI process in an
organisation. For that reason, we focused on the banking sector of Pakistan and collected
data for several questions which become constructs to the indices. After data collection
through survey, exploratory factor analysis method was used to form indices for
analysing strategic performance, planning and focus, information gathering, analysis,
culture awareness, communication and process structure. Questionnaire ensured the face
and content validity as adapted from past studied (Ain, 2013; Du Toit, 2013; Muller,
2004; Nasri, 2011; Wright and Calof, 2006; Wright et al., 2009), in addition, the
questionnaire was also discussed with some professionals from banks and academia. This
study proposed an estimation of five equations where the first four were the effect of
process structure and cultural awareness indices effect on the indices of CI process one
by one. The last equation used the four indices of CI process on the strategic performance
of the banks. Since all the variables are characteristics of the same individual, thus
theoretically, all equations are interrelated. For this purpose, the study has utilised the
SEM approach (Wooldridge, 2010). The constructs formed were valid according to
convergence and discriminant tests. This approach is expected to be more efficient as it
uses the extra information which is the interrelation between the variables.

Competitive intelligence process and strategic performance 17
Resources and capabilities create the grounds for the foundation of sustainable
competitive advantage. RBV realises the firm as a bundle of capabilities and resources
that combined to create competencies. Capabilities can be explained as the skills a bank
needs to take full benefit of its assets. Assets are of little value deprived of such
capabilities. While combining RBV and CI prerequisites the structure and culture are
bank’s tangible and intangible resources which together create a capability for the bank to
utilise the CI process effectively to attain a competitive edge and enhanced business
performance. The results of the study are supportive of RBV that structure and culture
and awareness as a unique capability are positively affecting the CI process environment.
RBV stated that strong and efficiently managed tangible (CI structure) and intangible
(supportive culture) resources can be able to implement and conceive the firm’s strategies
for implementing CI process to attain high strategic performance and sustainable
competitive advantage. According to Dishman and Calof (2007), an encouraging culture
and motivated employees be able to input their know-how and understandings efficiently
to the CI scheme. Supportive CI structure and culture is crucial for an organisation who is
enthusiastic to have the utilisation of CI attempts efficiently.
The environment which includes other components of CI itself leads to the overall
improvement in the strategic performance of the banks. The present study concluded that
there is a positive significant impact of CI process on the performance of banking sector
of Pakistan, all the factors positively influencing the strategic performance of banks
except planning and focus which should remain measures as per the operational controls
of the bank. KBV is focusing the generation of new knowledge by collecting and
transforming existing available knowledge in the internal and external environment of the
bank. As CI (planning, gathering information, analysing and communication) is a process
which takes the view of KBV in which new knowledge is accumulated into existing
knowledge-base with the use of other tangible and intangible resource capabilities in this
intelligence knowledge creation process. Adidam et al. (2012) studied the influence of CI
practices on the Indian firm’s performance taking emerging market context, and came up
with the similar findings, that Indian firms which incorporate high extent CI practices
appeared with high financial performance.
Though, the present study applied RBV and KBV of the firm are the key viewpoints
of strategic planning for accomplishment of superior strategic benefits and sustainable
competitive advantage via creating valuable competencies. CI process is a mechanism to
achieve superior long-term strategic performance leading to sustainable competitive
advantage under the umbrella of RBV and KBV.
7 Theoretical and practical implications
This study adds to the existing body of CI literature through utilising the complete
procedure of CI activities in the form of mechanism which is implicated through SEM
technique. This study is also first in its nature because we took RBV, KBV and CI
process as complementary to each other. In addition, we investigated the impact of CI
process on strategic performance of banks which is studied by only a few researchers
(Ahmed et al., 2014; Waithaka, 2016). In developing countries like Pakistan banks, either
SMEs, private or public are facing competition from international banks. CI can provide
an advantage to local banks to maintain and confirm their long-term sustainability

18 N. Hanif et al.
through legally implementing the CI unit in their workplace to act proactively in the
market and industry. There can be a great role of academia to offer CI degree programs to
provide the highly qualified professionals to the service and manufacturing industry.
There is a need for coordination between the industry and academics to identify the
industry and market benefits of long-term formal implementation of CI unit. The top
management of banks may establish the CI unit formally (as most of the banks in
developing countries are using all the stages of intelligence informally), that must be
undertaken by the highly educated CI professionals. As this study, indicated a positive
significant impact on achieving better strategic performance. Banks can organise
seminars, workshops, conferences and motivational programs to encourage the active
participation of employees in the CI process which will lead to supportive culture for the
CI process.
8 Limitations and future directions
This study focused on the banking sector of Pakistan; future researchers can investigate
the model proposed in the present study on other sectors. For example, the CI process can
be further investigated in manufacturing industry so that the importance and potential
benefits of the CI process can be highlighted for any business type. This study evaluated
the only non-financial performance of banks, future researchers can study the role of CI
process for financial performance. The present study was operationalised through
the survey; future studies may additionally use in-depth interviews while considering
comparative case study.
References
Adidam, P.T., Banerjee, M. and Shukla, P. (2012) ‘Competitive intelligence and firm’s
performance in emerging markets: an exploratory study in India’, Journal of Business &
Industrial Marketing, Vol. 27, No. 3, pp.242–254.
Ahmed, R., Ahmad, N., Khoso, I., Arif, K. and Palwishah, R. (2014) Competitive Intelligence and
Marketing Effectiveness of Organizations: An Investigation from Pakistan, Vol. 13, No. 10,
pp.342–353.
Ain, N.U. (2013) ‘Role of competitive intelligence in multinational companies’, International
Journal of Emerging Sciences, Vol. 3, No. 2, p.171.
Armstrong, S. (2007) ‘The intelligence behind CI: the Royal Bank of Canada’s CI efforts’,
Proceedings of CALL Conference, Toronto, Canada.
Babbar, S. and Rai, A. (1993) ‘Competitive intelligence for international business’, Long Range
Planning, Vol. 26, No. 3, pp.103–113.
Barney, J. (1991) ‘Firm resources and sustained competitive advantage’, Journal of Management,
Vol. 17, No. 1, pp.99–120.
Becker, G.S. (1994) ‘Human capital revisited’, Human Capital: A Theoretical and Empirical
Analysis with Special Reference to Education, 3rd ed., pp.15–28, The University of Chicago
Press, USA.
Beltramini, R.F. (1986) ‘Ethics and the use of competitive information acquisition strategies’,
Journal of Business Ethics, Vol. 5, No. 4, pp.307–311.
Blenkhorn, D.L. and Fleisher, C.S. (2005) Competitive Intelligence and Global Business,
Greenwood Publishing Group, MA.

Competitive intelligence process and strategic performance 19
Bose, R. (2008) ‘Competitive intelligence process and tools for intelligence analysis’, Industrial
Management & Data Systems, Vol. 108, No. 4, pp.510–528.
Brody, R. (2008) ‘Issues in defining competitive intelligence: an exploration’, IEEE Engineering
Management Review, Vol. 3, No. 36, p.3.
Burns, W.C. (1996) ‘Content validity, face validity, and quantitative face validity’, Fair
Employment Strategies in Human Resource Management, Boston, MA, pp.38–46.
Calof, J.L. and Skinner, W. (1998) ‘Competitive intelligence for managers: a brave new world’,
Optimum, Vol. 28, No. 1, pp.38–43.
Calof, J.L. and Smith, J.E. (2010) ‘The integrative domain of foresight and competitive intelligence
and its impact on R&D management’, R&D Management, Vol. 41, No. 1, pp.31–39.
Chawinga, W.D. and Chipeta, G.T. (2017) ‘A synergy of knowledge management and competitive
intelligence: a key for competitive advantage in small and medium business enterprises’,
Business Information Review, Vol. 34, No. 1, DOI [online] https://doi.org/10.1177/
0266382116689171.
Cleland, D.I. and King, W.R. (1975) ‘Competitive business intelligence systems’, Business
Horizons, Vol. 18, No. 6, pp.19–28.
Cohen, W. and Czepiec, H. (1988) ‘The role of ethics in gathering corporate intelligence’, Journal
of Business Ethics, Vol. 7, No. 3, pp.199–203.
Collins, R. (1997) Better Business Intelligence: How to Learn More About Your Competitors,
Management Books 2000, Oxford.
Cottrill, K. (1998) ‘Turning competitive intelligence into business knowledge’, Journal of Business
Strategy, Vol. 19, No. 4, pp.27–30.
Cox, D.F. and Good, R.E. (1967) ‘How to build a marketing information system’, Harvard
Business Review, Vol. 45, No. 3, pp.145–154.
Cronbach, L.J. (1971) Test Validation, American Council on Education, Washington, DC.
Daft, R.L., Sormunen, J. and Parks, D. (1988) ‘Chief executive scanning, environmental
characteristics, and company performance: an empirical study’, Strategic Management
Journal, Vol. 9, No. 2, pp.123–139.
Darling, M.S. (1996) ‘Building the knowledge organization’, Business Quarterly, Vol. 61, No. 2,
pp.61–66.
DeCarolis, D.M. and Deeds, D.L. (1999) ‘The impact of stocks and flows of organizational
knowledge on firm performance: an empirical investigation of the biotechnology industry’,
Strategic Management Journal, Vol. 20, No. 10, pp.953–968.
Demsetz, H. (1988) ‘The theory of the firm revisited’, Journal of Law, Economics, & Organization,
Vol. 4, No. 1, pp.141–161.
DeVon, H.A., Block, M.E., Moyle-Wright, P., Ernst, D.M., Hayden, S.J., Lazzara, D.J.,
Kostas-Polston, E. et al. (2007) ‘A psychometric toolbox for testing validity and reliability’,
Journal of Nursing Scholarship, Vol. 39, No. 2, pp.155–164.
Diamantopoulos, A. and Winklhofer, H.M. (2001) ‘Index construction with formative indicators:
an alternative to scale development’, Journal of Marketing Research, Vol. 38, No. 2,
pp.269–277.
Dishman, P.L. and Calof, J.L. (2007) ‘Competitive intelligence: a multiphasic precedent to
marketing strategy’, European Journal of Marketing, Vol. 42, Nos. 7/8, pp.766–785.
Du Toit, A.S.A. (2013) ‘Comparative study of competitive intelligence practices between two retail
banks in Brazil and South Africa’, Journal of Intelligence Studies in Business, Vol. 3, No. 2,
pp.30–39.
Enders, C.K., Hancock, G. and Mueller, R. (2006) ‘Structural equation modeling: a second course’,
Analyzing Structural Equation Models with Missing Data, Information Age Publishing, Inc.,
Charlotte, North Carolina, pp.313–342.
Fornell, C. and Bookstein, F.L. (1982) ‘Two structural equation models: LISREL and PLS applied
to consumer exit-voice theory’, Journal of Marketing Research, Vol. 19, No. 4, pp.440–452.

20 N. Hanif et al.
Fornell, C. and Larcker, D.F. (1981) ‘Evaluating structural equation models with unobservable
variables and measurement error’, Journal of Marketing Research, Vol. 18, No. 1, pp.39–50.
Fulad, L.M. (1994) The New Competitor Intelligence: The Complete Resource for Finding,
Analyzing, and Using Information About Your Competitors, John Wiley & Sons, Inc.,
New York, USA.
Gelb, B.D., Saxton, M.J., Zinkhan, G.M. and Albers, N.D. (1991) ‘Competitive intelligence:
insights from executives’, Business Horizons, Vol. 34, No. 1, pp.43–47.
Ghoshal, S. and Westney, D.E. (1991) ‘Organizing competitor analysis systems’, Strategic
Management Journal, Vol. 12, No. 1, pp.17–31.
Gilad, B. (1989) ‘The role of organized competitive intelligence in corporate-strategy’, Columbia
Journal of World Business, Vol. 24, No. 4, pp.29–35.
Gilad, B. and Gilad, T. (1985a) ‘A systems approach to business intelligence’, Business Horizons,
Vol. 28, No. 5, pp.65–70.
Gilad, B. and Gilad, T. (1985b) ‘Strategic planning: improving the input’, Managerial Planning,
Vol. 33, No. 6, pp.10–14.
Grant, R.M. (1996) ‘Toward a knowledge-based theory of the firm’, Strategic Management
Journal, Vol. 17, No. S2, pp.109–122.
Guimaraes, T. (2000) ‘The impact of competitive intelligence and IS support in changing small
business organizations’, Logistics Information Management, Vol. 13, No. 3, pp.117–125.
Hallaq, J.H. and Steinhorst, K. (1994) ‘Business intelligence methods – how ethical’, Journal of
Business Ethics, Vol. 13, No. 10, pp.787–794.
Hawkins, D.B. (2004) ‘Competitive intelligence in New Zealand’, Journal of Competitive
Intelligence and Management, Vol. 2, No. 4, pp.42–52.
Heppes, D.W. (2006) An Assessment of the Level of Maturity of the Competitive Intelligence
Function within a South African Retail Bank, University of Johannesburg.
Herring, J.P. (1996) Measuring the Effectiveness of Competitive Intelligence, Scip, Alexandria.
Herring, J.P. (1998) ‘What is intelligence analysis’, Competitive Intelligence Magazine, Vol. 1,
No. 2, pp.13–16.
Jones, W. and Bryan, N. (1995) ‘Business ethics and business intelligence: an empirical study
of information-gathering alternatives’, International Journal of Management, Vol. 12, No. 1,
pp.204–204.
Kahaner, L. (1996) Competitive Intelligence: From Black Ops to Boardrooms: How Businesses
Gather, Analyze, and Use Information in the Global Market Place, Simons & Schuster,
New York.
Kahaner, L. (1997) Competitive Intelligence: How to Gather Analyze and Use Information to Move
Your Business to the Top, Simon and Schuster, Touchstone Rockefeller Center, 1230 Avenue
of the Americas, New York, NY10020.
Kohli, A.K. and Jaworski, B.J. (1990) ‘Market orientation: the construct, research propositions, and
managerial implications’, The Journal of Marketing, Vol. 54, No. 2, pp.1–18.
Köseoglu, M.A., Chan, E.S.W., Okumus, F. and Altin, M. (2018) ‘How do hotels operationalize
their competitive intelligence efforts into their management processes? Proposing a holistic
model’, International Journal of Hospitality Management, DOI [online] https://doi.org/
10.1016/j.ijhm.2018.11.007.
López-Robles, J.R., Otegi-Olaso, J.R., Gómez, I.P. and Cobo, M.J. (2019) ‘30 years of
intelligence models in management and business: a bibliometric review’, International
Journal of Information Management, Vol. 48, No. 1, pp.22–38.
Magasa, L., Mphahlele, M. and Awosejo, O. (2014) ‘Utilization of competitive intelligence to
enhance firm performance: a case of South African small and medium enterprises’,
International Journal of Advanced Computer Research, Vol. 4, No. 2, pp.555–557.
Mahoney, J.T. and Pandian, J.R. (1992) ‘The resource-based view within the conversation of
strategic management’, Strategic Management Journal, Vol. 13, No. 5, pp.363–380.

Competitive intelligence process and strategic performance 21
Marin, J. and Poulter, A. (2004) ‘Dissemination of competitive intelligence’, Journal of
Information Science, Vol. 30, No. 2, pp.165–180.
Markovich, A., Efrat, K., Raban, D.R. and Souchon, A.L. (2019) ‘Competitive intelligence
embeddedness: drivers and performance consequences’, European Management Journal,
DOI [online] https://doi.org/10.1016/j.emj.2019.04.003.
Maune, A. (2014) ‘A conceptual analysis of the role of competitive intelligence in Zimbabwe’s
banking industry’, Journal of Governance and Regulation, Vol. 3, No. 2, pp.125–137.
McGangole, J. (1996) Competitive Intelligence: From Black Ops to Boardrooms – How Businesses
Gather, Analyze and Use Information to Succeed in the Global Marketplace, in Kahaner, L.
(Ed), 288pp., Wiley Online Library, Simon & Schuster, New York.
Meyer, H.E. (1991) Real-world Intelligence: Organized Information for Executives, Storm King Pr,
West Hollywood.
Muller, M-L. (2004) ‘How to make your competitive intelligence ventures work’, SA Journal of
Information Management, Vol. 6, No. 2, pp.1–6.
Myburgh, S. (2004) ‘Competitive intelligence: bridging organizational boundaries’, Information
Management, Vol. 38, No. 2, p.46.
Nasri, W. (2011) ‘Investigate competitive intelligence process: an exploratory study in Tunisian
companies’, International Business Research, Vol. 4, No. 4, pp.62–73.
Nasri, W. (2012) ‘Conceptual model of strategic benefits of competitive intelligence process’,
International Journal of Business and Commerce, Vol. 1, No. 6, pp.25–35.
Ngugi, J.K., Gakure, R. and Mugo, H. (2012) ‘Competitive intelligence practices and their effect on
profitability of firms in the kenyan banking industry’, International Journal of Business and
Social Research, Vol. 2, No. 3, pp.11–18.
Nonaka, I. (1994) ‘A dynamic theory of organizational knowledge creation’, Organization Science,
Vol. 5, No. 1, pp.14–37.
Pellissier, R. and Kruger, J-P. (2011) ‘Understanding the use of strategic intelligence as a strategic
management tool in the long-term insurance industry in South Africa: original research’,
South African Journal of Information Management, Vol. 13, No. 1, pp.1–13.
Pole, J.G., Madsen, E. and Dishman, P. (2000) ‘Competitive intelligence as a construct for
organizational change’, Competitive Intelligence Review, Vol. 11, No. 4, pp.25–31.
Ponis, S.T. and Christou, I.T. (2013) ‘Competitive intelligence for SMEs: a web-based decision
support system’, International Journal of Business Information Systems, Vol. 12, No. 3,
pp.243–258.
Porter, M.E. (1990) ‘Why are firms successful’, Paper presented at the Fundamental Issues in
Strategy Conference, Napa, CA.
Porter, M.E. (2008) Competitive Strategy: Techniques for Analyzing Industries and Competitors,
Simon and Schuster, New York.
Prescott, J.E. and Gibbons, P.T. (1993) Global Perspective on Competitive Intelligence, Society of
Competitive Intelligence Professionals, Diagonal Road, Suite 520, Alexandria.
Prescott, J.E. and Smith, D.C. (1987) ‘A project based approach to competitive analysis’, Strategic
Management Journal, Vol. 8, No. 5, pp.411–423.
Rabe-Hesketh, S., Skrondal, A. and Pickles, A. (2004) ‘Generalized multilevel structural equation
modeling’, Psychometrika, Vol. 69, No. 2, pp.167–190.
Safarnia, H., Akbari, Z. and Abbasi, A. (2011) ‘Review of competitive intelligence & competitive
advantage in the industrial estates companies in the Kerman City: appraisal and testing of
model by Amos graphics’, International Business and Management, Vol. 2, No. 2, pp.47–61.
Salavati, M., Waninge, A., Rameckers, E., Steen, J., Krijnen, W., Schans, C. and Steenbergen, B.
(2017) ‘Development and face validity of a cerebral visual impairment motor questionnaire for
children with cerebral palsy’, Child: Care, Health and Development, Vol. 43, No. 1, pp.37–47.
Shih, M-J., Liu, D-R. and Hsu, M-L. (2010) ‘Discovering competitive intelligence by mining
changes in patent trends’, Expert Systems with Applications, Vol. 37, No. 4, pp.2882–2890.

22 N. Hanif et al.
Singh, R., Seshadri, D., Adidam, P.T., Banerjee, M. and Shukla, P. (2012) ‘Competitive
intelligence and firm’s performance in emerging markets: an exploratory study in India’,
Journal of Business & Industrial Marketing, Vol. 27, No. 3, pp.242–254.
Slater, S.F. and Narver, J.C. (2000) ‘Intelligence generation and superior customer value’, Journal
of the Academy of Marketing Science, Vol. 28, No. 1, p.120.
Spender, J.C. (1996) ‘Making knowledge the basis of a dynamic theory of the firm’, Strategic
Management Journal, Vol. 17, No. S2, pp.45–62.
Stefanikova, Ľ., Rypakova, M. and Moravcikova, K. (2015) ‘The impact of competitive
intelligence on sustainable growth of the enterprises’, Procedia Economics and Finance,
Vol. 26, No. 1, pp.209–214.
Tomer, J.F. (1987) Organizational Capital: The Path to Higher Productivity and Well-being,
Praeger Publishers, Connecticut, USA.
Viviers, W., Saayman, A. and Muller, M-L. (2005) ‘Enhancing a competitive intelligence culture in
South Africa’, International Journal of Social Economics, Vol. 32, No. 7, pp.576–589.
Waithaka, P. (2016) ‘Competitive intelligence practices and performance of firms listed on the
Nairobi Securities Exchange, Kenya’, European Scientific Journal, ESJ, Vol. 12, No. 19,
pp.107–126.
Wall, J.L. (1974) ‘What the competition is doing – your need to know’, Harvard Business Review,
Vol. 52, No. 6, pp.22–38.
Wernerfelt, B. (1984) ‘A resource-based view of the firm’, Strategic Management Journal, Vol. 5,
No. 2, pp.171–180.
Westervelt, R. (1996) ‘Gaining an edge: competitive intelligence takes off’, Chemical Week,
Vol. 158, No. 25, pp.29–31.
Williamson, O.E. (1975) Markets and Hierarchies: A Study in the Internal Organizations, Free
Press Amazon, New York.
Wooldridge, J.M. (2010) Econometric Analysis of Cross Section and Panel Data, MIT Press,
Cambridge.
Wright, S. and Calof, J.L. (2006) ‘The quest for competitive, business and marketing intelligence:
a country comparison of current practices’, European Journal of Marketing, Vol. 40, Nos. 5/6,
pp.453–465.
Wright, S., Eid, E.R. and Fleisher, C.S. (2009) ‘Competitive intelligence in practice: empirical
evidence from the UK retail banking sector’, Journal of Marketing Management, Vol. 25,
Nos. 9–10, pp.941–964.
Yin, C-Y. (2018) ‘Measuring organizational impacts by integrating competitive intelligence
into executive information system’, Journal of Intelligent Manufacturing, Vol. 29, No. 3,
pp.533–547.
Zellner, A. (1962) ‘An efficient method of estimating seemingly unrelated regressions and tests
for aggregation bias’, Journal of the American Statistical Association, Vol. 57, No. 298,
pp.348–368.
Zellner, A. (1963) ‘Estimators for seemingly unrelated regression equations: some exact
finite sample results’, Journal of the American Statistical Association, Vol. 58, No. 304,
pp.977–992.
Zellner, A. and Huang, D.S. (1962) ‘Further properties of efficient estimators for seemingly
unrelated regression equations’, International Economic Review, Vol. 3, No. 3, pp.300–313.

Competitive intelligence process and strategic performance 23
Appendix
Questionnaire on CI practices in banks
Process and structure
PS1
Our bank has appropriate policies and procedures to contribute effectively to competitive
intelligence.
PS2
We use information management tools (e.g., data mining, data warehousing, ‘business
intelligence’ software, etc.) to understand customers.
PS3
We train/prepare our employees before they go to (e.g., trade shows, exhibitions,
conventions, etc.) about information they look for.
PS4
Our employees attend intelligence seminars/training seminars.
PS5
Key decision makers are surveyed/interviewed to verify that intelligence products
produce for them, satisfy their needs.
Culture and awareness
CA1
Understanding and awareness of competitive intelligence activity is a significant factor
for the effectiveness and success of the bank.
CA2
New competitive intelligence projects are agreed with the consultation of our senior
managers/strategic units.
CA3
Our managers/strategic units specifically develop new projects themselves.
CA4
We are concerned about the plans and intentions of our key competitors, alliances,
suppliers, distributors and other stakeholders.
Planning and focus
PF1
In our bank, we meet with executives to identify their intelligence requirements.
PF2
Senior managers use competitive intelligence in their planning and decision making.
PF3
Our bank develops profiles on emerging technologies to better understand their
characteristics, potential applications and market advantages.
PF4
For competitive intelligence activity our main purpose is (strategy and planning,
understanding markets trends and competitors, etc.).
Information gathering
IG1
Our bank collects information about banks own sources and capabilities.
IG2
Our bank has a variety of methods for collecting information (e.g., trade shows,
websites, industry reports, etc.).
IG3
Our bank gathers information about banks external environment.
IG4
We maintain a comprehensive map or inventory of internal information and knowledge.
IG5
There is a central coordination point for receiving competitive intelligence information.
IG6
Results from exit interviews/job interviews are used in our intelligence system.
Analysis
A1
Our bank produces intelligence reports and assessment on emerging technologies that we
believe are most important.
A2
Our bank produces assessment that addresses several possible outcomes of our
competitor’s actions that might be threats or opportunities for our bank.
A3
Our bank analyses our competitor’s plans and strategies to predict and anticipate their
actions.

24 N. Hanif et al.
Questionnaire on CI practices in banks (continued)
Analysis
A4
Our bank uses basic competitor’s analytical models (e.g., SWOT, ratio and gap analysis,
best practices, competitor analysis, industry analysis, etc.). Also, tick the option bank
use.
A5
We evaluate our competitive intelligence findings.
A6
We evaluate the reliability of our sources of information (e.g., persons, publications,
internet, etc.).
Communication/dissemination
C1
Our intelligence findings are widely distributed within the company.
C2
We have a variety of ways to present intelligence findings (e.g., briefings, newsletters,
competitor’s profile, etc.).
C3
In our bank, the bank’s intelligence needs are communicated to employees.
C4
We report our intelligence findings to our senior managers and CEO.
C5
Our bank culture encourages information sharing.
Strategic performance
P1
Our bank has good understanding of its global market potential.
P2
Our bank copes with rapid changes in traditional areas of its business.
P3
Competitive intelligence has impact on the financial performance of our bank.
P4
Competitive intelligence helps in improving our bank’s position in market.
P5
Competitive intelligence works as long-term investment for our bank.
P6
Competitive intelligence helps in enhancing strategy and planning of our bank.
P7
Competitive intelligence helps in understanding markets and its trends.
P8
Competitive intelligence helps in improving the quality of our employee’s skills.
P9
Competitive intelligence helps in improving the quality of our bank’s service design.
P10
Competitive intelligence assists in improving internal operational process of bank.
P11
Our bank developed strategies to compete its competitor with respect to quality,
performance and market growth.