As always when we enter a new year, business and technology trends are announced of what is expected to be next, that will shape the industry, and the industry may need to get ready for. What is in the cards on the technology side ranges from digital transformation, artificial intelligence, virtual reality, and 3D printing and much more. This is further influenced by world and/or market affairs that may impact the business and prompt change. While not all applicable to the commodity trading and risk management industry, let’s consider: TRENDS in 2017 that also apply to C/ETRM Continue reading
Cloud-based Software-as-a-Service has quickly become a compelling and credible delivery model for business applications. If you aren’t converted yet, then realize how you already take part in on-line banking, share your medical records with healthcare providers, and access your retirement investments.
All very personal information that you may think should be equally or more sensitive than the production database of commodity trading companies. Further consider how much your business relies on communicating via the internet.
On-premise installed C/ETRM software would be as equally ‘out-of-service’ as a cloud-based solution when the internet isn’t available. Therefore, for the educated trading professional looking for proven solutions that lower cost and improve operations, there is something Between Heaven and Earth: The Cloud.
There are several definitions but commonly an Enterprise Resource Planning (ERP) system automates and integrates core business processes such as taking customer orders, scheduling operations and keeping inventory records and financial data. ERP systems have been around and made popular by companies such as SAP, Oracle, Microsoft, NetSuite and a slew of lesser-known vendors.
A fully integrated solution promises to deliver operational efficiencies and improve business results. What’s not to like?
It’s no surprise that softs commodity traders were sold on such an established solution. However, when trading is surrounded by risks and volatility, index pricing and non-standard contract invoicing, they may wonder: Is it Nuts to use ERP instead of CTRM?
Whether it is the energy or the commodity market, they reflect a 21st century business climate of on-going and fast change. Low prices and new regulations are main reasons for the latest turmoil. Your current playbook does not help protect your current business, nor does it succeed in getting you into new ones.
It’s Albert Einstein’s definition of insanity: doing the same thing over and over again and expecting different results. Just ask all of those famous companies that missed the next wave, like Kodak and most recently Nokia. Don’t become a “Kodak Moment:” Change your Playbook with a modern C/ETRM system.
In the low-margin business of a retail energy supplier, the timely procurement of sufficient wholesale supply at the best possible price and risk level is critical to its profitability. To answer fundamental questions about supply & demand, portfolio performance, valuations, and profit & loss, requires an integrated system that handles the business processes from supply contracts to settlement, and where the retail sales book is linked to the wholesale sourcing book to facilitate in-depth monitoring and assessment of positions and exposures. Are you able to Parse your Portfolio for Profitability?
Wholesale energy markets have never been easy and when global deregulation started over 20 years ago, energy trading became more complex giving rise to information technology solutions to address the risks with energy trading: Energy Trading and Risk Management (ETRM) systems.
It was essentially the first message that the use of ETRM systems was the prudent way to help market participants manage complex risk scenarios and effectively trade and manage energy transactions from trade capture to delivery and settlement. Following several years of economic hardship due to the 2008 global financial crises, market participants now face an environment of ever-emerging rules, the effects of renewable energy and competitive pressures.
It is with an effective ETRM system that market participants can respond to three main challenges: Increasing complexity and workload, contain operating cost, and regulatory requirements.
As C/ETRM systems advance, delivering the latest technical innovations supporting commodity trading, the successful software vendor will practice what Steve Jobs so famously said: “You’ve got to start with the customer experience and work back toward the technology – not the other way around.”
With C/ETRM systems being such a substantial investment, customers can ill afford failure. Realizing their C/ETRM vision for increased efficiency, cost-effectiveness and happy productive employees, calls for a comprehensive engagement approach that ensures success and delivers a superior customer experience. Prospective customers therefore will be interested to learn from C/ETRM vendors: Is your C/ETRM solution Not Just Capturing Deals, but also the Customer?
Progress always involves risk: you can’t steal second base and keep your foot on first. Decision-makers not willing to get out of their comfort zone will choose a solution based on the old adage “you can’t go wrong with IBM.”
A misguided attempt to secure their jobs. Decision-makers interested in real progress and getting ahead are what management consultant Geoffrey Moore calls “early adopters” and “pragmatists in pain.” They go with disruptors who have a better mousetrap to solve problems that can’t be solved with established products.
Market demand for renewable energy continues to grow due to governmental programs, increasing corporate initiatives as well as households voluntarily choosing to purchase ‘green’ energy. Consequently, the volumes of Renewable Energy Certificates (RECs) guaranteeing that the electricity was produced from a renewable energy resource are swelling.
Apart from the management challenge of tracking RECs and monitoring exposure, those types of certificates that are tradable carry a value and must be settled and reported. This calls for automation of the end-to-end process, from generation to expiration or retirement. Pioneer’s RECTracker provides a robust solution from inventory planning to accounting. Time to ‘renew’ your RECs/GOs management system?
REMIT reporting of trades executed on Organised Market Places (OMP) started on October 7, 2015. All other trades, i.e. bilateral trades, need to be reported from April 7, 2016. While the October deadline was largely covered by the OMPs, or other services to carry out the reporting on behalf of the market participant, the April deadline is more complex and requires implementation of the right system solution to meet this challenge best. Pioneer Solutions’ REMIT module is ready to support your Standard- and Non-Standard Contract reporting as well as Electricity and Gas Transportation Contracts. Are you ready for April 7?