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Competition issues in the implementation of global brands and the system of industrial espionage

Industrial espionage and competition issues in the modern world are becoming more ambitious shapes, thereby affecting all spheres of human activity. Create all things, ideas and services subject to fierce competition, as far as the relationship of competition and economic policies can affect international relations. Competition – inherent in commodity production struggle between entrepreneurs in the market for more favorable conditions of production and marketing of products for getting the highest profit. Research competitiveness of goods and services – one of the main links of research in the market economy, which allows to identify the strengths and weaknesses of the products and services offered. In this regard, relevant today is the creation of a coherent system of economic intelligence on the markets, competitors, partners, contractors, new technologies, legislation, etc., and in addition – the knowledge used in the business of ways to search, access, use of information and also used type of deception and fraud. The fierce competition for markets and products, the scope of application of capital and the pursuit of maximum profits forced executives of major corporations to closely monitor the activities of their competitors. It may be used as economic intelligence and industrial espionage.

International competition has become one of the most important factors to convert many types of business entities. Today, globalization is directly addresses the issue of branding of products and businesses. Growth in revenues  and  an  increase in life expectancy lead to a change in the structure of their consumption. They are starting to travel more and for pleasure and for business, because the competition is getting tougher all price sectors of the market: an expensive, high cost and cheaper. In such circumstances, it is important that producers themselves at the same time the image of a global and a caring company and  be  at  the  expense of the name, if necessary, people all over the world remember the first.

It is believed that China is obliged by its economic breakthrough, especially as industrial espionage [1]. At times, new models of consumer goods in China appear even before their official appearance in retail sales in the country of the developer. "The Chinese collect any information needs in the field that has the demand, and then sorted and bit by bit taken their findings to produce the desired result," – shares his impressions of the security manager of one of the European companies operating in China.

Chinese entrepreneurs as accurately replicate well-known global brands that even the pickiest buyers could hardly be much different from a copy of a fake. Modifications of brand names (eg, Sonny, Panasounik, Nixe, Adidos) Chinese  have  moved to a full copy  of  all  the  technical characteristics of the new models, not yet released into general availability [1].

Despite all the security measures global companies,  Chinese  craftsmen  unfurled  a giant -scale production and sales of new models, which are in fact illegal copies of Western brands. Since the iPhone 4 has been successfully released as Apple, and factories of China. However, a comprehensive sales network in China is already on the iPhone   5, which is Apple's only exists as a working sample of a few copies. The gadget is called hiPhone 5 and presented as a new product from Apple. It, for example, can be purchased from the online store on Taobao relatively low price – from 200 to 800 Yuan (United State $ 30-125).

Still,   that   means   competition   is   inherent in commodity production struggle between entrepreneurs in the market for more favorable conditions of production and marketing of products for getting the highest profit [2].

Research competitiveness of goods and services one of the main links of research in the market economy, which allows identifying the strengths and weaknesses of the products and services 2005 began with the conclusion of one of the largest M & A transactions in recent history. Corporation Procter & Gamble announced the takeover of Gillette – the world famous manufacturer of shaving accessories, batteries, Duracell, Braun appliances and toothbrushes Oral-B. In accordance with the terms of the deal for Gillette shares will be paid 18% more than their real market price – $ 57 billion. With this acquisition, Procter & Gamble has managed to become the world's largest manufacturer of consumer goods, and finally beat his longtime rival and almost enemy – the Anglo – Dutch company Unilever. Corporate wars that are both global giants for decades have long been the talk of the town. In the long history of their competition was even such an interesting page as industrial espionage, had started three employees at Procter & Gamble Unilever companies under the guise of conducting market research.

The main objects are the focus of industrial espionage, patents, designs, trade secrets, technology and cost structure. Economic espionage than trade secrets covered, and  macroeconomic indicators and includes exploration of natural resources, the identification of industrial supplies, in connection with  the  development  of  marketing  increasingly valuable collection of information about the tastes and incomes of different social groups in society.

One of the  most  recent  scandals occurred with the new electric car Renault. French secret intelligence report accusing China run by active industrial espionage, appeared after three employees of French automaker Renault were charged with transferring classified information to Chinese competitors and fired [3].

A variety of methods and techniques of Chinese copying does not cease to admire. An example of this is the story of how the Chinese real estate market is filled with masterpiece of world architecture. After a visit to Shanghai, the delegation of the Austrian province of Hallstatt, a partnership with the Austrian city, Chinese developers  have  decided  to  build in Guangdong copy of the Austrian countryside, which, thanks to its architecture, is a real tourist attraction and is included in the monuments of cultural heritage. After expressing during the visit of Chinese welcoming his friendly attitude and willingness to cooperate, the Austrian authorities have not yet decided to give a legal assessment of such intentions. Industrial espionage involves not only the theft of other people's secrets, but creating a system to protect its own – in fact, business counterintelligence. After all, now the Chinese and the development of interest to foreign spies [4].

Thus, there was an interesting fact, where an 8- year imprisonment and a heavy fine Beijing court for spying was sentenced American geologist Xue Feng of Chinese origin, who was sentenced to eight years in prison and a large fine for espionage. Arrested him in November 2007 on charges of collecting secret information and transfer of foreign organizations. The idea was that Xue Feng sold the information from the database of China's oil industry that the Chinese police qualify as state secrets. According to the investigation, in his possession were coordinate data and resources of more than 30,000 oil and gas wells, owned Chinese company PetroChina Ltd.

With the development of industrial espionage industrial monopolies carefully guarded the contents of patents, the results of scientific and technical studies, projects and designs all of its products. The organizational structure consists of the so-called Trans Nation Corporation technical centers, whose main task is to develop new products, improve the quality of existing products, develop new technologies, etc. In order to increase profits Trans Nation Corporations seeking to establish  the true value of their own products. This involves a detailed analysis of competitors' products in order to establish the comparative quality of their products [5].

As is well known, large-scale patent war between the above companies who accuse each other of copying technologies and designs, which are built on the basis of mobile devices, erupted in the spring of 2011. Both parties have filed against each other in various states of many lawsuits. During the trial, both sides added to their claims of a new competitive products.

The United State company claims to its competitor emerged after it in 2010 on the market produced communicator Galaxy S. The moment Apple executives turned to his South Korean counterparts to complain that their device strongly resembles the device iPhone [6].

The company Samsung has not changed the design of their own creation, and the next year the market has released a tablet computer Galaxy Tab. After those Jobs was filed with the requirement to prohibit the implementation of competitor vehicles in the United State market. California court took the American side of the company and ordered the South Korean manufacturer to pay compensation billionth. Industrial espionage is illegal, and not only related to the risk of criminal prosecution as including senior executives of the company, and reputational risks. No "spy" information may not be so valuable to the benefits of using it blocked the loss of reputation loss and impairment of trademarks, brands of the company [7].

The task of the unit or department "competitive intelligence" is just part of getting legal, ethically acceptable means of open and accessible sources, through market research, market intelligence, technologies and competitors. Including the information that other market players would like to hide. By the way this desire is also often illegal and unjustified nature.

A  lot  of  fuss  about  the  case  at  the  airport in Chicago, where he was detained a Chinese programmer with luggage confidential documents Motorola, designed for the transfer of Huawei. According to court documents, customs officers also found a woman's military records and directory of European companies producing defense products. Motorola claims that spending on research and development of information that was available to programmers calls more than 600 million dollars.

Along with well – known methods of modern industrial espionage uses the  latest achievements of science and technology. Very often were used various microscopic devices based on various electronic circuits.

Special technology allows you to capture any information indulge verbally, via telephone, fax, computer. Window glass can serve as microphones: they wobble special devices to reconstruct the conversation. The use of electronic technology provides special services of  monopolies,  as well as state security  services,  the  ability  to  obtain the necessary information on the status of the competition, their negotiations, etc. [8].

Last year, Google became the object of a complex hacker attack in China: an attacker to certain codes of search engine Google, a major component of the company's intellectual property. Google later notified more than a dozen other companies, they are  also  victims  of  the  attack. In addition, third-party researchers came to the conclusion that the attack is over 100 companies, including a large investment bank, a manufacturer of high-tech equipment, software makers and defense contractors. Among those who paid attention to the Chinese, – Symantec, Adobe Systems and Northrop Grumman. In all cases, the aim has been attacks intellectual property, including software code design microprocessors [9].

China  is  a  serious  concern  for  those  who are planning to produce equipment. European manufacturers believe that the new technology from China to save hard.

With the development of computer technology and the creation of various kinds as a global computer network (global) and the various local networks, such as bank, there is a problem of protection of information sources in these networks. Any unauthorized intrusion, for instance in banking network may lead to loss of important information in the loss of its privacy and as a consequence – the use of this information in any gain. The development of computers and computer networks with the development of software piracy and theft has forced many governments to apply different measures, for example, in the United States organized a special group responsible for the safety and security of computer networks and computer databases, as anyone with a computer, network access, and a certain intelligence can get access to such computer data  banks  that  contain  strictly  confidential  and sensitive information that is not designed for the average user. As an example, a case which occurred in the United States, where one user can connect to a network of computers of the Ministry of Defense, as a result of his malice was completely destroyed important information is one of the Pentagon's computers [10].

The term "industrial espionage" will mean illegal (secret or force) the removal of information that guides the competing companies would like to hide from strangers. It can be: theft or illegal copying of documents: drawings, plans, calculations, scripts, lists, databases, etc., installation of eavesdropping or scanning equipment, bribery or blackmail competitors' employees to gain access to sensitive information, breach of trust and carelessness of the company's employees in order to obtain sensitive information from them, abuse of carelessness or negligence of employees of a competing company to gain access to sensitive information:

  • "competitive intelligence" we mean obtaining legal: analytical and / or research methods from open sources of information about the market, competition, technology and development, which is essential to the company to make the right strategic decisions;
  • "bench- marketing" we mean learning experience, strategies, solutions, best business practices of companies in the industry to take advantage of this experience, in adapted form, to improve the quality of our work;
  • "ethics of civilized business" we understand this way of doing business, the practice of economic activity according to which not only violated the laws of countries of stay, Codes and voluntary standards adopted by the participants of the market, but have not been contacted and followed the rules and regulations of conduct companies to meet the legitimate interests of the companies and other market participants (competitors, suppliers, resellers, service companies) of consumers and the public [11].

Many of the actions that qualify as "industrial espionage" are criminal offenses. In addition to the criminal prosecution of individual employees found guilty of industrial espionage, a company involved in this, expect (in the West) multiple punishments, from a very imposing fines in favor of the injured party, and the state (as it is believed that these actions are detrimental to all society), and ending the ban on output similar to the one that she had been "attacked by spyware" and the forced disclosure of classified information and its own development.

Allactionsareclassifiedas"industrialespionage" unequivocally condemns the ethical point of view. Including – and the professionals working in the departments of "competitive intelligence",  many of which have come in these departments work of special services like the Central Intelligence Agency (CIA), Federal Bureau of Investigation (FBI), The Department of Internal Affairs (DIA) [12].

 

References 

  1. 1 Hasanov R.M. Industrial espionage in the service of the monopolies. Moscow: International Relations.2006, – p.190, P.78-99. 2 Seidel. X., Temmen. R. Fundamentals of the economy. //M: Business LTD. 2009, – p.400, P.217.
  2. 3 Makonnell. K. Bru. C. Economics : Principles, Problems and Policies. //M. Republic. 2002. Volume 1, – p.794, P.381-383. 4 Porter. M. International competition. M.: 2004, – p. 581, P.15.
  3. J. The economic theory of imperfect competition. M. 2008, – p.352, P.93-105.
  4. G.I. Foundations of a market economy. Moscow: UNITY . 2006 . – p. 423, P.103-171. 7 Tolkachov . C. Imperfect competition. / / Economic Journal. 2003. N.5. – p.220, P.134.
  5. Materials: http://sapienti.kiev.ua/categories/history/_adidas_puma/ Sapienti, port information Adidas vs. Puma (10.09.2012)
  6. Berezin President of the Guild of Marketers, //Summary of Remarks at the 1st All-Russian Conference on benchmarking, Russian Organization for Quality ( EQA ) and the club's " Business Excellence " 24-25 June 2005, the city of Cheboksary ., The magazine "Practical Marketing » № 7, 2005) – p.107, P.57-60
  7. Bredy A. Industrial espionage / / Commercial and industrial rolls. – M. - 2004. – № 5 . – p. 222,95-113. 11 Skrypnyk F. Economic espionage and intelligence / / Chief Financial Officer. – C. – 2003. – № 4. – p.12-15. 12 Materials: http://www.it2b.ru / Technology for Business Intelligence (14.12.2013 г.)

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