Firm profiling and competition assessment: A design science approach

Abstract

Extensive efforts have been made by both academics and practitioners to understand the inter-firm competitive relationship owing to its profound impacts on multiple key business goals, e.g., company benchmarking, marketing strategy planning, and talent acquisition. However, it has never been an easy task to fully characterize firms and assess the competitive relationship among them, mainly due to the challenge of information heterogeneity. In this regard, we propose a novel IT artifact for firm profiling and inter-firm competition assessment guided by Information System Design Theory (ISDT). We start by constructing a Heterogeneous Occupation Network (HON) using employees’ occupation details and educational attainments. Then we adopt a Metapath2vec-based heterogeneous network embedding model to learn firms latent profiles (embeddings). Using the firm features and embeddings as input, we train multiple supervised classifiers to assess the competitive relationship among the firms. Following the principles of design as a search process, we demonstrate the effectiveness of our IT artifact through extensive experimental studies and detailed discussions. Our research has also discovered that the occupation and education specifics of employees are key factors in identifying potential competitors of a focal firm.