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November 20, 2008

 

Open Ratings Alert: A New Business Model?

I found this press release early this morning that suggests D&B / Open Ratings might be getting into the flip side of the supply risk management business by letting suppliers publish their rankings in the system (I have no idea if this specific case was authorized by D&B or not). The main problem I have with this model is that an Open Ratings rating or alert can change anytime (that's the power of it, after all). A press release is permanent, and could mislead customers or analysts in a month or quarter from now, because it's out in the public domain, but dated.

As important, I have at least a small issue with any supply risk management business model which also takes funds from suppliers to help on the marketing front, given the potential conflict of interest in the combined sets of activities and revenue models. Open Ratings is a risk management pioneer of sorts -- and they've got a very significant market opportunity with their core business model. I sincerely hope they don't get sidetracked with additional sources of potential revenue which might potentially call into question the objectivity of the rankings which procurement and operations organizations pay for.

- Jason Busch

Comments
Open Ratings has been in this business for many years - at least five. It's called "Past Performance Evaluations" and they are primarily purchased by companies doing business with the government. You can <a href="http://www.openratings.com/services/Services_PastP...">see an example on their website.
# Posted By Sean Devine | 7/12/06 12:21 PM
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