Oracle Analytics: Business Intelligence and Analytic Applications - The CIO's Guide to Oracle Products and Solutions - page 62

Step 2. Information meeting : At this meeting, each attendee will
receive an allotment of time to present his or her information to the
group.

The group will then perform a relative strengths/weaknesses
analysis. This will be done for all areas of interest uncovered by the
information obtained by the group. The analysis will seek to draw
conclusions about two criteria. First, is a competitor stronger or
weaker than your company? Second, does the area of interest have
the potential to affect customer behavior?

Combustion Engineering rules dictate that unless the area of
interest meets both of these criteria, it should not be pursued fur-
ther either in analysis or discussion. Since managers do not always
agree on what areas to include or exclude, it is frequently necessary
to appoint a moderator who is not part of the group.

Step 3. Cost analysis : At this point, with areas of concern isolated, it is
necessary to do a comparative cost analysis. The first step here is to
prepare a breakdown of costs for each product. This includes labor,
manufacturing, cost of goods, distribution, sales, administrative as
well as other relevant items of interest.

At this point, compare the competitor's cost for each of these fac-
tors according to the following scale:

• Significantly higher

• Slightly higher

• Slightly lower

• Significantly lower

Now, translate these subjective ratings to something a bit more tangible,
such as slightly higher is equivalent to 15 percent By weighting each of
these factors by its relative contribution to the total product cost, it is now
possible to calculate the competitor's total costs.

Step 4. Competitor motivation : This is perhaps the most intangible of
the steps. The group must now attempt to analyze their competitor's
motivation by determining how the competitor measures success as
well as what its objectives and strategies are.

During the research phase, the senior manager and/or his or
her staff gathered considerable information on this topic. By using