Transcript
Confidential to Apple Inc Company
Watch Ltd
“Streamlining Supplier Risk”Data Feeds and Systems Integration
eWorld Purchasing & Supply ConferenceLondon, 4 March 2014
John A. Smith – Client Relationship Director Company Watch
“Hindsight in Advance”
Northern Rock: September 2007
Lehman Brothers: September 2008
Halifax Bank of Scotland: September 2008
The Royal Bank of Scotland: October 2008
When Did It All Start?
Recovery Kills!
Businesses are now leaner, meaner and
hardened, BUT
They are more at risk emerging from a
recession
The Major Risk is:
Overtrading…….
Pressure on finances, staff and systems
Supply Chain/Procurement Teams should
be reviewing their key suppliers NOW
Changes
More Government cutbacks
Thursday, 7th May 2015 – Election Day
The banking industry
Regulations
Europe Referendum
You Need
Better and more timely
information…..
.….with a growing need for mobile
applications across an organisation
“Big Data”
Master Data Management/Data Governance
Data and systems integration
Better quality and more focussed business
intelligence - rather than just data
Single view of a customer/supplier
Two Data Delivery Systems
Browser - direct to users
Data Feeds and APIs (Application
Programming Interfaces)
- direct to users’ systems/computers
CONTRACT CHAIN
COMPANY B£ 150 M
COMPANY C£200 M
COMPANY D£ 250 M
Company m £25 MCompany n £25 MCompany X £20 M
.
Company p £40 MCompany q £40 MCompany X £25 M
.
Company r £70 MCompany s £60 MCompany X £30 M
.
Company t £80 MCompany u £80 MCompany X £35 M
.
.
YOUR COMPANY
COMPANY A£ 100 M
How good are your analytical tools?How good are your analytical tools?
Forward looking
Flexible
Stress-testing & forecasting
Reliable
An indication of how often you are likely
to lose money
Does your ratings provider split up their
success rate by country/business type?
If not, why not?
Can I update the rating if I get
management accounts?
Question 1 – What percentage of companies which failed were flagged up as risky?
Question 2 – What percentage of companies are in your Warning Area or equivalent?
A big warning area decreases the amount of
defaults/failures which are missed, but decreases the
amount of business you can do.
Don’t Be Complacent –
You Need Tools You Can Trust?
Quantity ≠ Quality
Cheap ratings are a false economy
£280 Million debtLess than 7p per pound
Recovered
Is the rating overly sensitive to a particular
input?
Has the company reallocated which SIC code it
files under?
Question 4 – How Stable Are Your Ratings?
You need to be prepared for the
insolvencies of the coming two years
Make sure you have a rating system that
you trust
Separate the zen from the toys!
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