AkzoNobel is a leading global paints and coatings company and a major producer of specialty chemicals. Calling on centuries of expertise, AkzoNobel supplies industries and consumers worldwide with innovative products and sustainable technologies designed to meet the growing demands of a fast-changing planet.
Headquartered in Amsterdam, the Netherlands, AkzoNobel employs approximately 47,000 people in more than 80 countries, with a product portfolio that includes well-recognized brands such as Dulux, Sikkens, International, Interpon and Eka.
AkzoNobel is also consistently ranked as a leader in the area of sustainability and is committed to making life more liveable and cities more human. The Automotive & Aerospace Coatings division sells car paints (for repairs) and is known to many as the sponsor of McLaren's Formula 1 team, for whom former world champion Lewis Hamilton drives.
During a credit crisis and amidst collapsing markets, repairing car damages may take the back seat. When collecting accounts receivable became critical in the Automotive & Aerospace Coatings division, AkzoNobel turned to long-standing partner, Dun & Bradstreet. As Michael van der Steen, SBU Credit Manager at AkzoNobel explains, "It was at this challenging time that our first need was to get insight into the quality of our customer portfolio. The second was to have a better method to monitor our portfolio, particularly, larger customers. Finally, we wanted an easier way to determine credit limits."
Here is van der Steen's take on his company's successful partnership with Dun & Bradstreet.
How It Works
At AkzoNobel we look at the three C's: Customers, Costs and Cash. With this focus we began to screen our customer portfolio, which is divided worldwide over more than 20 countries. Our goal was to help our country organizations save time. By making work easier for them, they are able to concentrate on collections. Until the introduction of D&B, each country worked with their own tools, which did not comply with standards we had in mind. Another goal was to introduce structure into the assessment process of our credit limits. Thanks to D&B we have more consistent credit decisioning across our global organization.
D&B advised us to use Portfolio Manager to get insight on our customer portfolio. D&B Access for the Internet (DBAI) was then advised to be the most suitable product for monitoring customers. A standard solution was not sufficient to determine our credit limits and a custom solution was required. Ultimately, we chose Global Decision Maker (GDM). We performed a regression analysis to see if a link could be discovered between customers, which is specific for a branch for example. Together we analyzed the portfolio of our customers over the last two years. This showed us which customers had not paid, as well as the signals they had given. The custom solution of D&B has the extra advantage that we can also load the data into our own SAP system. Along with high quality data and specific expertise with scoring models, D&B offers additional insight such as payment experiences, data from public sources such as the Chamber of Commerce, debt collection, concern structures and interviews). We can trust this information thanks to D&B's quality assurance processes.
Results and ROI
Our payment installments have also been reduced by 15 to 20%. Thanks to Portfolio Manager we have access to a system in which we can see what our customers are doing both at group and at branch level. DBAI gives us the opportunity to monitor the top 300 of our customers. 80% of the turnover at AkzoNobel is generated by 20% of the customers. It is therefore important for us to be fully informed about this group. I see Global Decision Maker as the finest result. As a result of the regression analysis a model was built, which makes customer lists with a classification into "good" and "investigate further." We are a separate branch as far as payments are concerned.The results we achieved were remarkable. Dun & Bradstreet contributed to a 60% reduction in our claims in arrears. For this reason, we greatly value our partnership with D&B and I am especially pleased with the solutions they provide. There was the realization within D&B that a standard solution is not sufficient for companies in the Fortune 500™. D&B understands that a standard solution doesn't always work for Fortune 500™ companies and that AkzoNobel is internationally active, requiring innovative products. Their solutions make them suitable as a partner at the highest level.
For more information on AKzoNobel please visit www.akzonobel.com