Value can be subjective. What is precious to one person can be useless to another. For example, a mountaineer attempting to scale Mt. Everest will find more value in a cheap backpack than a Chanel purse that costs thousands of dollars. Likewise, a person stuck in the middle of a desert would prefer a bottle of water over a truckload of diamonds. So, in practical situations, necessity and need overshadows flamboyance and wants. Nowhere is this truer than in the cut and dry field of finances. Here, the bottom line matters. The TRaiCE team understands this. We know that financial institutions are wary about making long-term monetary commitments to us without first assessing the value of our technology. That’s why we offer our prospective clients Proof of Value (PoV) pilots that allow them to test the TRaiCE waters before jumping in.
What is a PoV pilot?
As the name suggests, a Proof of Value pilot is a process that allows companies to assess the value of purchasing a tech solution without outright buying it. A PoV can ask and answer important questions such as: ‘Does this application solve our ___ (insert your company’s #1 priority) problem?’ or ‘Does it save us time and cut costs in the long run?’.
In other words, a PoV can help you look past a software’s marketing jargon and see if there is any substance behind the talk or not.
Why the TRaiCE team goes beyond your average PoC
PoCs have been around since the 1980s. It's been standard practice, then and now, for tech companies to perform Proof of Concept (PoC) demonstrations for prospective clients to showcase the viability of their solution. In our humble opinion, while a PoC is important, it isn’t nearly enough. You see, the important question here is not whether the solution works or not (it probably does). The more crucial query is, ‘Does it work for YOU?’. Your company is unique and comes with its own business quirks and idiosyncrasies. Just because a solution works for another company, does not mean it will work for yours.
This is why we believe demonstrating Proof of Value goes above and beyond your average PoC. While a PoC will show you that TRaiCE works for the lending and the investment sector as a whole, a PoV pilot gives you tangible proof that it will indeed work for your company too. The difference between the two, we think, is so much more than just a couple of alphabets!
How the TRaiCE team conducts a PoV pilot – Our 4-Phase Modus Operandi
The TRaiCE team philosophy revolves around this famous quote by American investor John Doerr: “Ideas are easy, execution is everything, and it takes a team to win.” We know that the value of an idea lies in its execution and not in its inception. It is with this ideology in mind that we developed our Proof of Value blueprint. Our modus operandi is focused on two things: Prove value and prove it fast. There’s no dillydallying or beating around the bush with us!
In addition, our execution plan is iteratively designed. This simply means that, first, our process is repeatable, no matter what environment we are in. That way, we aren’t wasting any time deciding on a course of action and are ready from the get-go. Second, and more importantly, our process is flexible, so we have the room needed to customize our solution to meet your company’s unique needs.
With every pilot, we go in with a mindset of proving value in as little as 4 weeks. To do that, we have 4 important checkpoints or phases that we use to ensure your PoV journey stays on track every time.
Here is a brief overview of our 4-phased approach:
Phase 1 – The discovery phase
Our first step is to ‘discover’ your needs. The TRaiCE team will sit with you to understand your requirements down to the last little detail. This includes scoping the handful of business entities (say, 10) you want to monitor, the TRaiCE elements you want to see in action, or the specific risk metrics you want to see tracked. We also assess all the data that you have internally, and how we can augment it to meet TRaiCE’s data requirements. The team then condenses all this information into a single ‘statement of work’ document that clearly defines the PoV timeline and its end goal or exit criteria.
At TRaiCE, we have an inbuilt culture of transparency and accountability. We will be clear upfront as to what is possible, so you don’t have to worry about getting a mouse when you’re expecting an elephant or vice versa! We only move forward with the PoV once you have seen and signed off on the exit criteria document. As we seek to implement the PoV within 4 weeks, we usually wrap up the discovery phase within a week.
Phase 2 – The onboarding phase
The next step in our PoV methodology is data onboarding. Here, we collect pertinent data on the entities being monitored such that it meets the objectives of the PoV. The duration of this phase can depend on several factors such as the amount of information available, how organized it is, and the data sources integrating with your system. We allocate a maximum of 2 weeks to this phase Given this, we identify and onboard only a subset of the data available. This is still sufficient enough for us to illustrate value, however.
Other conditions such as monitoring duration and the scope of implementation can also affect the timeline here. For example, if all you want is to monitor an entity’s basic metrics, we can accomplish this data onboarding in a handful of days. Conversely, if you want the whole gamut of TRaiCE features such as the Probability of Default calculations, the onboarding timeline will depend on the time taken to integrate our system with the necessary data sources.
Phase 3 – The processing phase
Once we have onboarded the necessary data, the next step is to input, process, and run this through the TRaiCE engine. Apart from determining tangible risk-monitoring insights, we also provide value to your company by automating the end-to-end flow of data.
Then we sit back and watch as the TRaiCE system organizes the data, investigates it, and establishes credit risk data relationships to produce default-predicting inferences.
As an additional advantage, TRaiCE’s predictions are all backed by solid logic and are explainable to boot.
Phase 4 – The testing phase
In our final phase, we test and validate the results. We do this by backtesting the outcomes and insights displayed in the TRaiCE web application. Our PoV pilots are run using historical data. This way, you can clearly see if our application was able to predict adverse financial events that happened in the testing time frame or not. If the system was running as it should have, it would show increased watch levels corresponding to future payment defaults by the monitored entities, all of which you can easily corroborate.
With future testing, the PoV timeline will be different. This is because we need to run the TRaiCE system for at least 3+ months and monitor a statistically significant number of customers. This will train the models sufficiently enough to prove the value TRaiCE brings to your investment monitoring.
Once these 4 phases are complete, we hand over our pilot implementation to you, so you can test it out yourself for the next 15 to 30 days or so.
A case study to prove it all
An Asian payment-mediation company approached us with the intention of bolstering their financial risk monitoring process. Like a lot of other financial organizations around them, this company was using the manual method of financial risk monitoring. They were heavily reliant on a team of analysts that did extensive market research and time-consuming data analysis to ensure the risk profile of the entities they were doing business with. They had an inkling that employing an AI-augmented system would make their risk monitoring process faster and more efficient and, therefore, approached us.
The client wanted us to monitor 25 of their partnering entities. These partnering entities were mostly banking organizations using our client’s payment mediation infrastructure. The client’s additional requirements were that we go back in time for a period of 2 years and that we showcase the default-risk levels and early warning alerts that TRaiCE produces for that time period.
Our TRaiCE Proof of Value
As our client wanted to see early warning alerts for potential financial risk, we needed the TRaiCE engine running at full power. Accordingly, we collected relevant financial data from annual reports along with regulatory disclosures of the participating entities for the previous 8 financial quarters. We then mined data from external sources such as newsfeeds and social media. In addition, we collected stock market data on the entities that saw trading action from various stock exchanges.
Our team onboarded all the data from these sources and ran it through the TRaiCE system, back-tested it, and then handed it over to the client for testing, all within the space of four weeks.
Interestingly, some of our client’s customers had had very poor quarters within the 2-year time frame given to us. TRaiCE was able to comb through these entities’ digital footprint and catch early warning signs of this. What’s more, our application caught and waved these red flags a good 3-6 months before the negative events actually took place.
After the completion of our PoV, the client recognized the value of the TRaiCE solution to their organization. They were also cognizant of the fact that without it, they were exposing themselves to higher levels of financial risk and were, therefore, keen to augment their financial risk monitoring process.
Conclusion - The proof is in the pudding!
You may not be as confident as we are of TRaiCE’s capability to provide an enterprise-level credit monitoring system at speed. That's alright. We get it. But, if you are a lending organization or an investment organization looking to augment your portfolio monitoring process, but are unsure of how, or if, it will work in your unique business environment, then why not engage us to deliver Proof of Value? The proof, as they say, is in the eating of the pudding. We promise conclusive validation at lightning speed. We also promise you won’t be disappointed!