Page 92 - Bouvet årsrapport ENG 2010 ePub

Bouvet annual report 2010 92

Employees

Since the core of Bouvet’s business is the quality, expertise and enthusiasm of its employees, the company depends on low workforce turnover. Its future proftability and market position might be adversely afected if key personnel decided to leave. Continued growth will also depend on the ability to attract qualifed new employees.

Competitors

Competition in the market will be impor-tant for Bouvet’s further development. Te company operates in a competitive industry with many existing players as well as new start-ups. Tat could result in loss of market share and diminished profts.

Client portfolio

Bouvet has a strategy of establishing and further developing long-term relationships with the clients. As a result, a signifcant share of its revenues derive from a relatively limited number of clients. Te 10 largest of these accounted for 49.7 per cent of the company’s turnover in 2010. If one or more of these clients decided to terminate their relationship with Bouvet, it could have major consequences for the company.

Pricing

Part of Bouvet’s revenues derives from fxed-price contracts which commit the company to execute assignments at predetermined prices. Should errors have been made in its pricing, the company’s results would be adversely afected.

Innovation

Bouvet currently ranks as one of Norway’s leading IT consultancies. Tis sector is characterised by rapid technological devel-opment, changes in client requirements and frequent new product updates and enhance-ments. Te company depends on its ability to stay in the forefront of developments in the industry. IT consultancy has also been characterised historically by cyclical fuctua-tions in both profts and revenues.

Third-party suppliers

Te company’s business concept is to delivery consultancy services to its clients. Such services are to a certain extent based on existing software developed by independent third parties over whom the company has no control.

Financial risk is described in note 23 on fnancial instruments. See page 60.

It is neither desirable nor possible to eliminate all risk relating to Bouvet’s business activities. However, the company works actively to ensure that risk is managed in an acceptable and systematic manner in all parts of the business, and regards this as a condition of long-term value creation for shareholders, employees and society. Bouvet will always assess growth opportunities in relation to the risk picture.

Operational risk

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