Simon Sole is the Chief Executive Officer of Exclusive Analysis. Exclusive Analysis, recently acquired by IHS, is a specialist intelligence company that forecasts commercially relevant political and violent risks worldwide. Leveraging a unique global source network of over 1,000 human sources and a highly systemized intelligence methodology, Exclusive Analysis delivers accurate, decision-ready forecasts to business leaders across the world.
Q: What one fact that sets you apart from the competition would you like the market to know?
Simon Sole (SS): We forecast. These forecasts are precise and take a transparent position. We draw on our core methodologies for influence mapping, indicator identification, intelligence collection, qualitative forecasting for political risk, scenario analysis and modelling to deliver tailored solutions for clients’ specific needs
Q: How much of your political risk analysis work is associated with investment in the planning stage, as opposed to existing ventures?
SS: Our analysis work is used at a variety of investment levels. We have been involved in the due diligence, initial country entry planning and scenario planning stages. Sometimes this analysis requires 5-10 year forecasts or even over the proposed lifetime of the project. Our bespoke work for existing ventures could include business continuity planning, strategic planning around potential regulatory or political risks changes such as elections or event violent risk assessments.
We draw on our core methodologies for influence mapping, indicator identification, intelligence collection, qualitative forecasting for political risk, scenario analysis and modelling to deliver tailored solutions for clients’ specific needs.
Q: What does it mean when you say that your forecasts are “decision-ready”? Can you give an example? When you say that “forecasting is all we do” does that mean that you do not recommend courses of action to your clients?
SS: We do not recommend any course of action to our clients. We provide the information as an independent unbiased third party. It is up to the clients to make the business decisions. Unlike a think tank, we have no political agenda either. Clients trust us as we are not trying to sell any other services, nor do we trade on our own accounts. Our independence allows us to access areas of intelligence that others cannot.
Our forecasts are aimed to provide actionable information for our clients. They are written in a concise, accessible language. Client should be able to read them and be informed enough to make a decision. That means we pay attention to how we phrase things. Terms like ‘clash’ or ‘tension’ do not provide clarity to a situation. We believe that the language of risk should be precise because that adds the most value for clients. We deliver precise forecasts to our clients and enable them to make important business-changing decisions. We take transparent positions rather than hedge our views.
For example: Egypt – CURRENCY RISKS – The IMF is unlikely to grant Egypt a loan before June 2013, without which there is a severe risk of uncontrolled currency depreciation.
Q: In the intelligence field, dissemination, not collection, collation, or analysis, is often the greatest source of failure. In your experience as political risk advisors, is that also the case? How can you make sure your advice gets to the right people in client firms?
SS: We wholeheartedly agree. Dissemination = value. Our streaming facility, for instance, enables clients to select what they want to receive and when they want to receive it. Clients can use all of the advanced metadata in our online intelligence platform, the Foresight Suite, to create their own forward-looking intelligence updates, and to choose when they want to receive them. They are in control, and have full and transparent access to all of the advanced flagging we use.
There are also many means of dissemination. The market needs integrated solutions and that is what we provide. We map forward-looking intelligence. We enable clients to upload and visualize their assets and exposures in a mapping interface that has risk ratings for war, terrorism, civil unrest and overall political violence for every 500 square meters on the planet, and to interrogate geocoded analytical content at the same time. We maintain over 4000 dynamic metrics that can be embedded within in-house risk management systems and processes. Our forthcoming portfolio analytics application enables clients to perform instant analytics on an entire portfolio of assets in a browser.
Q: What are some indicators that tell you it is time for a client to simply shut down and flee from a site rather than try to maintain a defense against physical threats? Have there been cases where the security situation is so severe that you advised a client to close down operations and flee?
SS: We do not recommend any course of action to our clients. We provide the information as an independent unbiased third party, and our forecasts are clear, specific and actionable. We also scale the delivery of intelligence through asset-specific risk ratings and peril-specific metrics, in order to enable clients to assess our forward-looking intelligence against their own internal risk tolerance. But it is up to the clients to make the business decisions.
Q: How do you know when a country’s long-entrenched political order is about to crumble?
SS: Our analysts always try to see what we call “the red car.” If someone is looking at a traffic jam, then they see lots of cars. By focusing on the entity, the traffic jam, many analysts miss the indicator of change hidden amongst the general noise. This indicator is what we have dubbed “the red car.”
By making sure that analysts have resources such as sources on the ground, country and sector expertise as well as an understanding of not only one country but the region, our team has been able to pick out red cars around the world.
Our correct forecast in October 2010 that Mubarak would be ousted by civil unrest was something only Exclusive Analysis was saying at the time. It is because we were in the cafes of Cairo and not the palaces of Mubarak that we were able to arrive at this forecast. The MENA team was able to find the red car and therefore successfully forecast a long-entrenched political order about to crumble.
Q: What are the hardest risks to see coming?
SS: To see something coming you have to make sure it is in your line of sight. The idea that a given risk was “impossible to see coming” tells us more about the analyst and the analysis community making the statement than about the risk. It tells us that they missed the indicator of change hidden amongst the general noise. That is why we focus on forecasting and dedicate our global intelligence infrastructure to identifying indicators of change.
More about Exclusive Analysis:
Since 2003, Exclusive Analysis has been at the forefront of developing cutting edge political risk forecasting methodologies, intelligence tools, and above all a unique team of global forecasters bound by a core ethos: Be Trusted and Be Right.
Foresight is a suite of customizable online political and violent risk forecasting products. Key features include a global database of over 500,000 risk relevant incidents and over 12,000 briefs reported against specific risk indicators; intelligence driven sub-sovereign risk scores that can be integrated with in-house systems and powerful geo-streaming and customizable risk types that reduce information overload.