DATE=7/29/1999 TYPE=BACKGROUND REPORT TITLE=CORPORATE INTELLIGENCE NUMBER=5-43978 BYLINE=BRECK ARDERY DATELINE=NEW YORK CONTENT= VOICED AT: INTRO: Spies have been gathering intelligence for governments for centuries. Now, as VOA Correspondent Breck Ardery reports from New York, there is a growing use of intelligence experts in business. TEXT: Just as nations are at a disadvantage when they do not know what their rivals are doing, businesses can have serious problems without extensive knowledge of the competition. The desire for accurate and timely business intelligence has spawned a new specialty in the consulting business. John Nolan is Chairman of the Phoenix Group, a firm that concentrates on gathering information for its corporate clients. Mr. Nolan, a former intelligence officer for the U-S government, says a usual starting point in any intelligence operation is the gathering and analysis of publicly available information. ///Nolan act/// We go about that increasingly by using the internet and receiving clippings from subscription services and then analyzing what these various pieces of information tell us about the project. Sometimes we can satisfy most of what we need to know by what is publicly available. We are also able to increase our understanding of the specific business environment better than we did when we started. ///end act/// However, Mr. Nolan says publicly available information has a serious limitation because some of it may be outdated or unreliable. In most assignments, he says, it is necessary to talk to people with direct knowledge of the company he is investigating. Mr. Nolan says a surprising number of current and former employees of a business are willing to talk. In some cases, Mr. Nolan and his associates will disclose who they are and why they are asking the questions. In many instances, however, a ruse will be adopted such as pretending to be a potential customer or employer. He says there are several ways to find people who are willing to talk. ///Nolan act/// We go to a chat group on the internet. For example, we could put in a search criteria looking for Dell Computer and electrical engineering. We might find 12 people who now work or recently worked at Dell computer. Then we search for their names somewhere else and may find they are also involved in backpacking or sailboating and perhaps through that interest we will develop a relationship with a person. That is just one example. We also attend professional meetings, survey literature and examine organizational charts that always give us sources of information. ///end act/// John Nolan says his firm, and all legitimate corporate intelligence consultants, draw a firm line against committing any illegal acts such as burglary, wiretapping or bribery. But, even if they operate entirely within existing law, some critics say corporate intelligence experts do engage in unethical behavior, especially when they use false identities to obtain information. In addition to gathering information about a company's future product or marketing plans, Mr. Nolan says intelligence consultants often design psychological profiles of top corporate executives. ///Nolan act/// We produce psychological profiles of corporate leaders much as we did those of foreign leaders when we worked for the government. We get our information from former superiors, former and present peers, people he plays golf with or serves on charitable boards with or people from his university days. Then, we give a prediction of the way a person will act in a merger or joint partnership agreement. ///end act/// Of course, the other side of gathering intelligence on business competitors is advising a business on how to keep its confidential information confidential. Mr. Nolan says one critical step that companies should take is to limit the number of people who have access to confidential business information. ///Nolan act/// Let us say that I know something very sensitive and I talk about it to my friend Bill in another department, not because he needs to know it but just because he works for the company. Now, say you start talking with Bill, well he does not have the same understanding of protecting the information because it has nothing to do with his job. He may feel that if I shared the information with him, it is o-k to share it with you. ///end act/// Mr. Nolan says companies can also try to create a culture in which employees are careful about what they say and to whom they say it. John Nolan expects the business of business intelligence gathering will continue growing as more companies realize that knowledge is power and often an important competitive tool.(Signed) NEB/NY/BA/LSF/PT 29-Jul-1999 17:53 PM LOC (29-Jul-1999 2153 UTC) NNNN Source: Voice of America .