Finally, a risk management and opportunity discovery workbook for Small and Mid-Size Enterprises (SME) that offers self assessment tools that are highly effective and easy to use.
The SME|360 helps managers assess and score opportunity risk factors to mitigate risk, determine capital allocation requirements and prepare for raising finance from banks and other lending institutions.
The SME|360 helps managers understand and prepare for the stringent credit scoring and decision metrics used by lending institutions.
The SME|360 is modeled after recommendations developed by bank working groups formed to address best lending practices following the introduction of Basel II Capital Accord and the proposed Capital Requirement Directive (Basel II / CRD).
Objectives of the SME|360
To detail the main business and risk management practices that lenders generally look for when assessing and rating an SME
To provide SME with awareness of what is regarded by lenders as good corporate governance
To assist SMEs to meet the likely business information requirements of banks, private equity and investment banking institutions
Stringent credit analysis should not be considered as a compliance or regulatory imposition but as a catalyst for improving and embedding good risk management practices and business governance
Financial intermediaries and suppliers of funding can foster SME best practices GRC principles
Application of sound risk management practices enables SMEs to enhance sustainability, performance and shareholder value
Though there are no universally agreed and applied standards or similar benchmarks for SME risk management, the SME|360 provides a robust framework of GRC best practices that are industry agnostic.
The assessment framework is based primarily on materials obtained as a result of a general survey provided on a confidential and non-attributable basis by specific banks, consultants and SME representative organizations.
Design and Contents of Modules
The modules are designed as a self-reference guide. The modules are compiled around the typical information that SMEs use to manage an effective business. In turn, it should assist you to capture the required information about the rationale, capability, prospects and risks of your business, and to communicate this to banks and other providers of finance.
This information should help them to understand, assess and risk-rate your business for credit purposes in line with their own internal guidelines.
SME|360 is divided into five main sections:
1. Business Strategy & Targets
2. Business Market & Competition
3. Business Capability
4. Business & Financial Planning
5. Business Risk Management
Self Assessment Scoring Methodology, Calculation of Risk Budget and Enterprise View of Aggregated Risk
The modules contain descriptions of self-assessment techniques using the templates included in this document.
Product and Market Dynamics Assessment:
Product Risk / Customer Risk / Supply Chain / Competition / Market Dynamics
Business Function Assessment:
Operations / IT / HR / Facilities / Sales & Marketing / Management / Accounting,
Critical Success Factors / Risk Factor Assessment / Business Ratio / Business Plan Checklist / CFI/ (Macroeconomic Risk only in digital product)
This assessment exercise will provide you with easy and consistent reference data for completing and updating business and risk management plans. This information will aid transparency and facilitate communications with your bank and other funding providers.
Document is in PDF format. A complete set of fully digitized assessment templates can be ordered from Sum2.