One of the World's Best Brands: the CIA

This week, Politico reported that the CIA has let its analysts trade on the agency's brand to form a consulting firm, "BIA," (Business Intelligence Advisors) that peddles expertise in “deception detection,” i.e., the art of detecting when executives are lying based on clues in a conversation. BIA was formed by ex-analysts, but active-duty agents have moonlighted there. The CIA allows it because letting them earn extra money keeps  talented employees from decamping the agency for more lucrative jobs.

You will see this trend develop over the next few years. Just as corporations are outsourcing, employees who have a brand are unbundling themselves. The U.S. has been referred to as a "nation of freelancers," in the pejorative sense. Some, though, are benefiting from this trend, and that will continue.

This particular instance of unbundling also is a phenomenal example of the power of one of the world's best brands. The story points out that CIA has not necessarily covered itself with glory in detecting threats -- and you can bet the agents aren't going to teach executives how to use their most secret (or successful) techniques (like waterboarding).  What they're selling seems to be pretty mundane stuff.

In an example of BIA's work, the agents listen to an earnings conference call in which a manager is evasive when asked about revenue recognition. The agents tell the client (hedge fund SAC) that there is probably going to be an issue with revenue recognition because of the manager's evasiveness. The next quarter the problem appears. Genius!

But hey, David Einhorn (and other people) do this kind of thing every day. Lie-detecting is pretty much the whole point of listening to conference calls. So while the BIA service may have value, I gather there is quite a bit of sizzle-selling going on as well.

It was also funny (if unintentionally so), that the BIA employees who trained SAC managers in "deception detection" techniques reminded one person quoted in the story of Clarice Starling (Jodi Foster) in Silence of the Lambs. Sending out women trainers who can make men feel like that is worth money in the bank, folks.

The power of a brand can be awesome. I once asked Warren what he thought was the best business on earth. If he could own any business, what would it be. Without hesitation, he said, the Catholic Church. (This was before the pedophile scandals, which also illustrates how the best brands are vulnerable to management hubris and poor judgment.)

Anyway, the CIA is one of the world's great brands. Somebody at Langley has figured that out.