In the world of Corporate Linkage I often hear, “linkage is never finished”.  What do I mean by this statement?  Change is constant in today’s business environment.  Some businesses are starting up while others are closing their doors.  Businesses are acquired and businesses merge.  That is why at Experian we constantly monitor for changes in Corporate Hierarchies that may impact your business. 

Do you do business with Microsoft or Skype?  If you do, you may be interested to know Microsoft announced on October 13^th their acquisition of Skype was complete.  At Experian we started monitoring for this event back in May when Microsoft announced their intention to acquire Skype.  We didn’t make changes to our database upon an announcement.  We waited until the regulators and shareholders approved the acquisition and for the legal ownership change to occur.  This change in ownership is our trigger to update the database and make this information available to you – real time!

The ability to actively monitor for business changes and make real-time database updates is just one of the unique advantages of Experian’s Corporate Linkage offering.  How do we do this?  Well there’s definitely a bit of magic that comes from our technology, but there’s a human touch as well.  Sitting just a few desks over from where I sit is our team of talented Linkage Analysts; the human touch to Experian’s linkage offering. If you have not checked out Experian’s Corporate Linkage recently, you can learn more here.

In my last post I shared some insight on Experian’s Days Beyond Terms (DBT). Today, I’ll answer a question I received following that post – Why is there more than one DBT on a business credit report? The answer is different trade payment types may result in a different DBT. Let me explain what I mean to help pull it all together.

As you may recall, DBT is calculated from trade payment information received from suppliers. We then classify this information into three different categories – new, continuous and additional. 

• Continuous – trade payment information with at least one (1) update in the three (3) months
• New – trade payment information added within the last three (3) months with no previous updates
• Additional – trade payment information not updated within the last 3 months or non-trade accounts (ex: leasing and loans)

New and continuous tradelines provide a timely perspective on how a business is handling its current payment obligations. In addition, the distinction in tradeline type provides visibility into whether an applicant may be paying new vendors better or worse than the old vendors. Additional Payment experiences provide insight into past payment performance and recent experiences with nontrade accounts.

Experian calculates DBT for trade payment information classified as continuous and new. We also calculate a “combined DBT” which reflects the DBT of both continuous and new trade payment experiences. The DBT is available for the current month and historically through monthly and quarterly DBT trends to help identify timeliness of payment experiences over time.

I know that’s a lot of information, but I hope it it helped explain why a business may have more than one DBT. To see this information come to life a real business, check out the BusinessIQ Premier Profile.

In  recent posts I’ve written about the database where Experian data resides and the matching engine that brings it together.  Now, I’d like to write about one of the data elements that resides on the database and is seen on all of Experian’s commercial credit reports —  Days Beyond Terms (DB T).  To many it’s simple and straight forward but if you have questions hopefully I can provide answers.  So, let’s demystify DBT!

• Is DBT a credit score?  No
• Do you need a table to translate the DBT?  No
• Does DBT predict future performance?  Possibly
• Is it a point in time indicator?  Yes

The simple definition of DBT is the number of days beyond the invoice due date a business pays its bills.  So, if a business is supposed to pay its bills within 30 days and the business pays on day 37, the DBT is 7.  If a business pays before the invoice due date, the DBT is 0.

On Experian commercial credit reports, we aggregate the payment experiences from all trade payment suppliers in order to provide a DBT that’s reflective of all payment experiences.  This DBT is the dollar-weighted average number of days beyond the invoice due date that a business pays its bills. 

Experian also provides a DBT for select types of payment experiences such as newly reported (the first time a tradeline is reported to us) or continuously reported (a tradeline  with atleast one update within the last 90 days).  This will help determine if a business pays new suppliers better than others.

I hope this helps demystify the DBT.  If you still have questions, comment on this post.  If you have questions on another data element let me know as well.  Your question just may be the topic for a future blog.

Next week, the Credit Research Foundation’s (CRF) summer conference is in Chicago—and I am thrilled to attend.  Not only is this CRF Forum one of my favorites of the year, the forum is also in Chicago.  What else could be better? 

If you are not familiar with CRF, or have not been involved in a while, I suggest you check them out.  They are a non-profit educational and research organization dedicated to “advancing the understanding, practice and development of techniques and trends in business credit.”  So what does this really mean?  This group digs into issues, monitors trends, and provides recommendations on best practices.  This is done through the feedback of over 4,000 active members and outside experts who are ready and willing to share.

If you are lucky enough to attend the conference next week, I’d love to catch up.  If you don’t want to talk business I’m always up for sharing my thoughts on the best Chicago pizza.  I will be floating around the conference and at the Expo on Tuesday.  My colleague, Ann Skibicki will also be in attendance and leading Experian’s BusinessIQ User Group on Wednesday.  If you have not signed up for the User Group, sign up today!

See you in Chicago!

As the summer heats up many of us are looking to take a break to enjoy our favorite summer activities.   While this break is well deserved (and essential for maintaining our sanity) it’s important to remember that the discipline around our credit decisions can’t take a break.  New applications still come in the door, products must be shipped and services must be performed   

This summer I am spending much of my “office time” working on a new credit report.  It’s my hope this report will help drive more informed decisions while freeing up your time to enjoy a well deserved summer break.   For years I’ve heard . . .

•  Do you have a fraud check right on the credit report?
• Do you have a credit limit recommendation on your credit report?
• How did the credit score look six months ago?
• What’s the NAICS code for this business?

Well, I’m happy to report we’ve listened!  The BusinessIQ Premier Profile answers all of those questions in one spot.  The report provides information needed to assess credit risk as well as the information to perform background checks.   Take a look and let me know what you think.  Will this report help you make more informed business decisions?  Did we free some time up for you to hit the beach or enjoy another fun summer activity?

Which comes first – BizSource or TrueSearch?  It’s a bit like the chicken and the egg – without one you can’t have the other.  BizSource is the repository where all the information coming into Experian’s commercial database is housed.  This repository holds the information that’s essential for creating the credit story – trade payment, public record, collection experiences and firmographic information.  The true magic happens when TrueSearch, our search match engine, sifts through millions of records and assigns a unique identification number to each unique business found.

Each time a new identification number is assigned, we look to identify if the business is linked to other businesses within our database.  What do I mean be linked?  In this case I’m referring to businesses legally connected.  This connection is often referred to as Corporate Linkage.  The linkage may be simple – as in the case of a small business with three operating locations.  The linkage may be complex – as in the case of Experian which is made up of multiple linkage entities.  Rather simple or complex visibility into corporate family is essential. 

BizSource and TrueSearch are the foundation for all products and services we offer.  So let’s just say that like the chicken and the egg, both BizSource and TrueSearch are critical to delivering superior business credit data, which always comes first in my opinion.

In my first blog posting I mentioned credit reports were the credit story of a business.  In this posting I’d like to provide you with some insights on the raw materials that are brought together to become the chapters within the credit story.

You may think it’s simple to compile information to create the story.  However that’s far from the reality.   There’s no tool that easily links payment information, public record filings or collection experiences from thousands of suppliers.   There’s no magic tool that scrubs and standardizes all the information.   If you’ve ever tried to combine data from multiple customer databases where there’s not a common link you’ve experienced the painful reality of what it takes to create the story.   The story is in the data but putting it together is the challenge.

At Experian, a team of magicians (a.k.a. data analysts and technology experts) come together and create tools that sift through information.  Through these tools and a bit of magic we determine what can be brought together to begin the story for a new business or add a chapter for another.  At Experian this process occurs within our BizSource^SM database using our TrueSearch^SM matching engine.    In my next blog I’ll share my thoughts on these powerful tools.

Doing business internationally is much simpler today than it was 10 or 20 years ago, but the need to mitigate risk while expanding globally has not changed.  That is why I’m so excited to launch our new international offerings through BusinessIQ .  We now provide access to a suite of products that provide global credit information on 225 countries.  The world’s not getting smaller —but information is getting closer through BusinessIQ.

 This is launch week, a crazy, yet exciting week in the life of a product manager.  If you’ve already logged on and accessed our international services, leave me a comment.  I would love to hear your feedback.

I am back home and have a moment to reflect back on NACM Credit Congress 2011.  Everyone was engaged – ready to learn and ready to share.  I experienced this first hand when I co-presented with Jessica Ford during a presentation focused on credit and fraud trends and ways credit professionals can help improve the bottom line.  For all of you that attended, thank you for making it such an interactive session.

Now I ask myself . . . What I do with the knowledge I gained?  As a product manager I’m looking for ways to bring better services to the market, ways to better articulate the value of a services Experian can bring to help credit professional positively impact the bottom line.  I can’t do everything.  Here’s a few questions I’m using to get started.  I suspect you are asking similar questions. 

• What are the immediate and long term needs?
• How do initiatives with other departments/products align?
• What’s the area of greatest need?
• What initiative will see the biggest return first?
• What initiative can I implement first?

Conferences are a great place to learn, it’s how we integrate what we learn that matters most.

Let’s catch up over a cup of coffee at NACM Credit Congress next week in Nashville.  We’d love to get your industry insights and share what’s new at Experian.  Hearing from businesses is the best way to understand what’s really going on in the industry, and we always appreciate the chance to chat with you. We’ll be in booth 501.

 We have a lot going on at NACM this year:

• Check out Mike Myer’s BusinessIQ^SM live demo on Tuesday, May 24 from 1-3PM. He’s passionate about this offering and will share a wealth of knowledge on the value it’s bringing to over a thousand businesses!  Click hear to sign up. 
• I’ll be presenting along with Jessica Ford.  We’ll share insights on the overall heath of small business in the US and discuss credit and fraud trends.  We’d love to see you at our session – Protecting Your Company From Credit Fraud. (Educational Session 19054, Wednesday, May 25 from 10:30-12:00).
• We’re also sponsoring Tuesday morning’s book giveaway and author signing so don’t miss Joe Calloway, author of Becoming a Category of One.

So stop by booth #501 to grab your cup of coffee (or latte, cappuccino or espresso), and be sure to attend  our sessions.  We look forward to catching up!