ProcureTechSTARS caught up with Heiko Schwarz, CEO & Founder of riskmethods, the intelligent way to manage risk.
During the conversation, Heiko shared his thoughts on AI based risk intelligence, self-fuelled engines, closed-loop risk experiences, becoming the go-to brand, Shazam and G&T…
1. What’s riskmethods‘ mission and USP?
riskmethods’ mission is to enable companies of any size to master supply chain risk, by helping them turn risk into competitive advantage.
“What makes us really different is that our AI based
risk intelligence is a fully integrated part of our delivery”
Which means we are not the traditional software technology that allows the customers to operate within a process shell and analytics framework etc, but we also deliver the content in the relevant supply network that our customers operate in.
In combination with the business process analytics, our service acts as an out-of-the-box, ready to go solution. The preciseness of our information feed is what makes us stand out from the rest of the crowd, especially in combination with our ease of use.
I believe riskmethods is excellent at AI powered risk intelligence and being able to hide all the complexity of supply chain risk control in the background and enable a great user experience, which means we are driving adoption correctly.
We typically experience organizations built in a traditional silo, they are not necessarily supply chain risk management experts. We help them to establish new business processes that covers all important topics that procurement departments and supply chain departments are responsible for: sustainability, cyber, compliance and any kind of disruptive events
We’ve also had feedback that our team are great to work with and our customers honour them, recently giving our customer success survey 10 out of 10!
2. What have been the most significant decisions and milestones in the riskmethods journey so far?
Fundamentally, the decision to found riskmethods in 2013 but also…
“choosing to have a holistic perspective on how the product should
develop over time to provide a closed loop process experience to enterprises”
We started with the capabilities to foster risk identification, followed by another milestone in our product development around 2014 when we enabled our customers to enhance the criticality and impact of identified threats to come up with a risk portfolio. Then to understand where to focus the preventive options, and how to drive the business forward.
A milestone back in 2016 was to go into the US market – this means big investments! As of now, the US contributes to a third of our revenues!
In 2020, we set up a strategic partnership with Zurich, where technology meets insurance and risk engineering services to provide a very interesting experience for customers. This enables customers to improve their risk exposure in supply networks and get insurance coverage, otherwise they can drown in processes. Having global risk engineering experts help these customers execute on mitigations, by using flood or fire protection experts in combination with capabilities within the finance, consulting and technology world. Altogether, that builds new solutions for enterprises. This year, we launched riskmethods Supply Risk Network: it’s a new hub that enables enterprises and their supply network partners to collaboratively manage supply risk in order to minimize disruptions, increase resilience, and protect brand reputation.
3. What do you look for in the perfect customer?
“At riskmethods, our mindset is that the customer
is at the centre of everything we do.”
Irrespective of technology, strategy or organizational development, we keep the customer in mind. As for the perfect customer, we are working with a manufacturing company that operates with international suppliers distributed across different countries, yet it has been participating and benefiting from globalisation. With that comes a complex supply chain and supply network with interdependencies across different tiers. Traditionally in manufacturing sectors like automotive, electronics, CPG, chemicals, medical devices and pharmaceuticals, value creation is continuously outsourced to other suppliers leading to further complex and interdependent supply networks.
We’re continuously growing into new domains that traditionally have not been our go to market focus, such as non-manufacturing businesses in the telecommunications space, stock exchanges, banks and service companies that don’t operate through physical supply networks.
Sustainable, ethical behaviour and cyber risk detection are all important factors for making supply bases resilient and eventually operations.
So we have 2 kinds of ‘perfect customer’ profiles.
4. What are the foundations of a great team?
Trust. This is created where there is reliability and team members take ownership, or their teams are kept accountable to perform to deliver what has been promised.
Respect: Act respectfully is one of our values. We value each other’s opinions, celebrate each other’s successes and support each other in all endeavours.
Also, I think fun is an important success factor as well. If you put all that together, you’re poised to be successful which feeds confidence.
“Where there is accountability, reliability and trust,
this acts as a self-fuelled engine, then leaders need to maintain
these factors to fuel each other.”
It’s not hard to set up the right organization for scale or find the great people. It’s really hard trying to make people communicate and collaborate in growing organizations or even challenge you with expectations that are not possible to deliver.
5. As we emerge from COVID what will you be doing differently?
We have been very open with remote working, which was a big opportunity that we missed in the past.
We were always set up for remote work with workers across Europe and the US. However, we experienced that the talent pool that we can attract as an employer is even much bigger than we thought with remote setups. That is a big opportunity, as the software industry is highly competitive with regards to key talent. It’s much more difficult in hotspots, for example, our HQ in Munich has a great talent pool, but is challenged by job opportunities from Google across town. Salesforce has its German headquarters in Munich as well as Celonis. The same goes in Boston; the job market is heating up and getting access to certain talent pools outside the country is an opportunity we hope to leverage from.
6. What is the vision for riskmethods for the future and what will be most important to achieve it?
“I envision that riskmethods is the go-to brand
for supply chain risk management.”
We already started to achieve that kind of status in our market where we started our journey. I recently heard at a customer conference that a Chief Procurement Officer said they use our company name synonym to SCRM. That’s where I want riskmethods to be on a global level five years from now.
“That goes together with execution of our strategy to continuously find, maintain and develop the talent we’re working with, as that’s the key ingredient to our success and a capability to execute our growth strategy.”
We’re going to dominate the niche and I think the market behaviour by then will switch from a push to a pull market.
“COVID showed that risk management of supply networks
is no longer a half discipline, but instead a must do discipline.”
The negative impressions and experiences the business made not only related to COVID, but related to supply disruptions in the last few years, were driven by the push from regulators, especially in the field of sustainability and human rights. This is something that we just can’t afford not to do or to not apply a professional approach to.
It’s not only about economic benefits that we provided for our customers, understandably, supply chain disruptions are expensive and you lose revenue and market share if you can’t deliver on the promises that you made to the markets, but there’s also a sustainability and ethical aspect that we can drive with our solutions.
7. How are you doing good for the planet?
“Supply chains act as a massive lever to establish
our standards and ethical and environmental practices.”
If you think about carbon emissions and supply chains, they really influence the fight against global warming, and this is what our customers pay a high degree of attention to when using our solution…how compliant, sustainable and environmentally friendly are the suppliers that they’re working with.
We help them generate transparency about the status quo and continuously monitor their compliance to see if they are having a positive impact to create a better planet. This also drives our employees to drive customers towards those sustainability programmes.
INSTANT HEIKO INSPIRATION
1. What is your favourite book or blog and why?
The hard thing about hard things by Ben Horowitz. It’s about situations for CEOs, entrepreneurs or leaders that are typically not in the management Bibles, as there isn’t a silver bullet, or a recipe to solve them. He addresses the really tough situations when things go wrong, how other leaders behaved, why they behave the way they did and what turned out to be good or bad decision.
2. Who is your favourite inspirational leader and why?
Nelson Mandela. I like his perspective about leadership, he said something like ‘it’s better to lead in the background and put the others into the foreground, especially when things go well’. On the other hand, he also said, ‘when things are going worse or bad, or even when there’s danger, you should be in the forefront’. That way, people will appreciate your leadership.
3. What is your favourite app or piece of technology?
4. What is your favourite cocktail?
No cocktails. Gin and tonic for me!
5. What’s your favourite way to celebrate success?
The most rewarding times are when I feel it really means something for others. For me, celebrating success is more about what it means to others; the ones that are impacted, such as customers, employees, families, sports team, whoever. My intrinsic motivation originates from seeing those people happy with what they have achieved.
1. Be prepared to establish new processes to break traditional functional silos
2. Provide closed loop experiences for enterprises
3. Scale your business progressively, through product, market and partnership growth
4. Place the customer at the centre of everything that you do
5. To be the best team, create an environment of trust and accountability where the team are prepared to communicate, collaborate and challenge
6. Talent is the key ingredient for the successful execution of strategy
7. Use the supply chain as a significant lever for improving supply chain resilience and sustainability
riskmethods empowers businesses with a solution to identify, assess and mitigate supply chain risk. By using artificial intelligence, we help you automate and accelerate threat detection, enabling you to gain competitive advantage with a well-managed approach to meeting customer demands, protecting reputation and reducing total cost of risk.
Our industry is moving forward faster and faster, empowered by innovative, progressive digital procurement solutions created and led by inspiring teams. ProcureTechSTARS are the digital procurement company CEOs and Founders that are leading the change, they are entrepreneurs, engineers and architects collaborating to transform procurement and the enterprise. In an open conversation with these leaders, Lance Younger will be discussing the highs and lows of building the future now, the challenges they’ve faced, their perspective on accelerators and hot topics, and what keeps getting them up in the morning (and keeps them up at night).