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Defend Your Company by Attacking It From Within

Defend Your Company by Attacking It From Within

The team should be charged with, among other things, determining ways to sabotage the company. That is, they should be brainstorming how a competitor could effectively challenge and undermine their company. They will be looking not only at what competing products/services could be coming down the track, but also how outsiders could somehow obtain access to company secrets.

By Theodore F. di Stefano E-Commerce Times ECT News Network
11/15/12 5:00 AM PT

For those who aren't familiar with the acronym SWOT, it means, "strengths, weaknesses, opportunities and threats."

Wikipedia defines this strategy Visit the VMware Tech Center as "a strategic planning method used to evaluate the strengths, weaknesses/limitations, opportunities, and threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective."

SWOT analysis applies especially well to a tech venture, because tech companies have to be constantly aware of the ever-changing threats to their products and to their very existence.

What I am proposing is that tech companies -- and other companies that operate in quickly changing environments -- have an in-house team devoted exclusively to trying to "sabotage" the company. By sabotage, I mean trying to anticipate what competitors could do, in some fashion, to hurt your company. This team should report only to top management.

Creating an Effective SWOT Team

The proper creation and structuring of a SWOT team is absolutely critical if the team is going to be an effective management tool. For this reason, I have outlined several of what I consider key factors to the creation and implementation of such a team:

  1. The team must have unfettered access to the workings of the business.
  2. The team should work in isolation and have very little contact with most of the staff.
  3. Information will be garnered mostly from the executive team that is responsible for reporting to the company's board of directors.
  4. Members of the SWOT team must sign confidentiality agreements and non-compete agreements before they start their work.
  5. The team should be composed of at least four members and no more than six members. Having more than that many usually becomes too bureaucratic and unwieldy.
  6. One person in the team will be designated the lead person. This person will be elected through a vote of the members of the team.
  7. The members should represent the disciplines of technology and business.

The Purpose of the Team

The team should be charged with, among other things, determining ways to sabotage the company. That is, they should be brainstorming how a competitor could effectively challenge and undermine their company. They will be looking not only at what competing products/services could be coming down the track, but also how outsiders could somehow obtain access, either through legitimate or illegitimate means, to company secrets, processes or customer lists.

On a more positive note, the team should also be constantly looking to the future in order to best determine what new products and services will keep the company growing and profitable. This is why, especially for a technology company, the team must include members steeped in the products and services of the company.

For example, if certain company patents are due to expire within a couple of years, the team should be looking at ways by which the company could approach the inevitable event in a proactive way in order to best respond.

Reporting to Management

Ideally, this team should present an annual, detailed report to the board of directors outlining the strengths, weaknesses, opportunities and threats to the company. In a perfect world, the team leader will have annual access to the board of directors without any interference from management, including executive management.

The team should also generate reports on a quarterly basis. These reports can go directly to the top executives of the company and include a complete SWOT analysis.

A monthly report can be created that will enable management to check up on the activities of the team, what the team has done in the prior month and in what direction it is heading.

An Inspired Team

The members of the team should be highly motivated and competitive. They should have specific goals, approved by the team leader, that aim to poke holes in the firewall that protects the company from unwanted incursions and unexpected competition. If the company does not have such a firewall, the SWOT leaders should immediately report this fact to the executive team and ideally help to create one.

Besides protecting the company in a defensive way, the team should be striving to create new products or services. For example, one international technology company I'm familiar with created a SWOT team to both protect and enhance its product offerings. The technology members of this team were given the special title of "research scientists."

I met some of these research scientists and they were among the brightest and most interesting people I've ever met. They were absolutely absorbed in their work and were, understandably, somewhat isolated from the other hundreds of employees who worked for the firm.

I was given the opportunity to take a tour of the SWOT area of this company. This was located in a corner section of an upper floor that had rather tight security. Since I don't have a technological background, I was allowed to walk through this area.

What I noticed was that these people were operating in a highly isolated manner without any obvious supervision. They were on their own and allowed to work quite independently. These individuals seemed to revel in their job, and I sensed a friendly competition among them.

One of them told me that they were having fun playing dual roles: one was to attempt to sabotage the company and the other was to create new products or processes that would bring value added to the enterprise. Additionally, one of the members of the team confided that they would get healthy year-end bonuses if their bifurcated work bore fruit -- either by finding ways an outsider could sabotage their company or developing a major advancement.

Although it would seem that one would need a split personality to have such a job, the people I met appeared quite "together" and reveled in their dual roles.

Assembling an effective SWOT team is a crucial endeavor that can affect the success and longevity of your business. Good luck!


Theodore F. di Stefano is a founder and managing partner at Capital Source Partners, which provides a wide range of investment banking services to the small and medium-sized business. He is also a frequent speaker to business groups on financial and corporate governance matters. He can be contacted at Ted@capitalsourcepartners.com. Follow Theodore F. di Stefano on Twitter.


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