Abstract:

This study aimed to reveal the contributions of game theory to competitive intelligence process in the formulating of business strategies. For this purpose, firstly, conceptual links between game theory and competitive intelligence are revealed and then, basic strategy analysis and equilibrium concepts are introduced in static and dynamic games. Implications are made regarding different perspectives that can be considered by decision makers in strategy analysis as part of the competition intelligence process. Game theory allows decision makers to explore games that create higher value so that they can seize cooperation opportunities within the competitive structures and generate higher profits. For rival companies, it is indicated that the long-term gains of cooperation can be preferred over the short-term high earnings of competition. Additionally, it is theoretically indicated how implausible strategies is determined with credibility criteria regarding the competing strategies and how the first mover advantage arises. Game theory, with its analysis tools and modeling infrastructure, is a tool that can significantly contribute to the goals of competitive intelligence. This study contributes to the competitive intelligence literature by addressing the role of game theory in strategy formulation from the perspective of competitive intelligence.

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