We normally talk about trends, challenges and opportunities in the Commodity and Energy Trading and Risk Management (C/ETRM) space, whether it is technical (Cloud, SaaS, automation, robotization, data analysis, etc), business (Agile transformation, digitalization, intraday trading, physical vs financial etc), or external market (deregulation, data protection, regulatory reporting etc). You’d think reasons enough for market participants to consider equipping themselves with next generation solutions. Well for those luddites that haven’t yet, see if you recognize yourself by Looking in the Mirror: 5 C/ETRM Solution Scenarios
1. Spreadsheet Monkey jumps to Digitalization
| Profile: | Small trading firm that started out with manual processes and spreadsheets |
| Objective: | Recognized its spreadsheets lacked risk controls, near-real time position updates, ability to comply with regulatory reporting, and scalability to support the growth of both its financial and physical trading activities. |
| Solution: | Pioneer Cloud-based Software-as-as-Service delivered via www.trmtracker.com. A modern, flexible yet robust ETRM system that will increase the efficiency of the business and improve trading, risk management and operational processes. |
| Why Pioneer? | TRMTracker.com offers a proven comprehensive set of tier-1 level front-to-back functionality that is built for rapid deployment, cost-effective, scalable, and because is it cloud-based with limited need for IT involvement. Moreover, it provided the ability for self-configuration, thereby reducing vendor reliance. |
| Result: | 100% improvement of risk management controls (trader and counterparty limits, Risk reporting). Real-time position updates increases trading risk mitigation as well as market opportunities. Automated trade capture from Exchange Venues. Ability to automatically report to Trade Repositories and local Authorities. Unlimited reporting capabilities with Excel Add-in tool |
- 2. The one that get the Monkey off his back
| Profile: | Large energy service company |
| Objective: | Replace legacy ETRM system that is unable to meet the changing needs of the Portfolio management function, with a more flexible solution that can handle the unique and evolving needs of the organization, can be rapidly delivered and results in a lower Total Cost of Ownership. |
| Solution: | TRMTracker is a next generation ETRM solution, built on a service oriented architecture, that is a live / real time system, able to model simple to complex processes through configuration without coding, is extendable, provides embedded middleware supporting modern integration formats, and can be implemented following an Agile implantation process for reduced project risk. |
| Why Pioneer? | TRMTracker was best able to model the company’s most complex scenarios. TRMTracker’s flexible architecture enabled Pioneer to commit to quickly building out the necessary capabilities to bridge the few identified project gaps. Pioneers’ product team had demonstrated a superior understanding of the customer’s business problems and requirements |
| Result: | The company could quickly translate their business needs into the system configuration and develop additional functionality without a protracted development process. The new ETRM system improved system flexibility and increased efficiency and effectiveness. |
- 3. Being better with Money than a Monkey
| Profile: | Integrated energy group involved in generation, wholesale and retail |
| Objective: | To realize a strategy as a customer-oriented sustainable energy company, that excels in customer services and can offer smart solutions, therefore requiring state-of-the-art back office automation. |
| Solution: | SettlementTracker is an application that provides exceptional functionality to support settlement of standard and non-standard products/contracts, supports shadow settlement to calculate estimates and checkout/reconciliation functionality, and can create Journal / General Ledger Entries. |
| Why Pioneer? | SettlementTracker provides unparalleled configurability of contract rules and billing determinants that is template-based, and formula driven. Proven integration with other ETRM systems. Moreover, Pioneer engages like a partner. |
| Result: | 100% transparency on charging data to applicable large commercial clients. Substantial savings and efficiency gains, with freed up settlement specialist to account management roles for improved customer services |
- 4. The fast climbing Monkey
| Profile: | Leading commodities trading firm |
| Objective: | To support rapid growth, a robust and integrated CTRM solution is needed to automate processes for improved position and risk management, logistical support for physical transactions, streamline accounting processes, and comply with regulatory reporting. |
| Solution: | TRMTracker, offering a flexible and scalable CTRM solution with support for the various commodity classes, and available as Software-as-a-Service delivery for easy access by international offices and reduced IT footprint. |
| Why Pioneer? | 21st century CTRM platform with state-of-the-art technology and integration capability, and the depth and breadth from front-to-back to add new product offerings, while being available as a true-cloud solution. On top of that, Pioneer engages as a partner and came with a great reputation |
| Result: | 100% improvement of risk management controls. Ability to automatically report to Trade Repositories and local Authorities for EMIR and MIFID II. Straight through processing with other front and back office systems. |
- 5. The 600Lbs Gorilla goes Best of Breed
| Profile: | Tier 1 multi-commodity wholesale energy trading company |
| Objective: | Rapid replacement and improvement of existing hedge accounting functionality within existing ETRM system by the automation of hedge accounting effectiveness calculation, fair-value and M2M accounting, while lowering the total cost of ownership (TCO). |
| Solution: | FASTracker, an integrated derivative accounting and disclosure software package designed to conform to FAS and IAS accounting standards including IFRS-9. A best-of-breed solution given replacement of the full ETRM system was not an option for reasons of cost, time, and sunk investment. |
| Why Pioneer? | FASTracker is available as a stand-alone system that seamlessly can interface to existing systems, supporting state-of-the-art integration capabilities. FASTracker had the capability and a technical infrastructure that could be customized to address the company’s unique requirements |
| Result: | >20% improvement in business process efficiency. An integrated platform. Standard solution across trading organization in different geographies. A better manageable, flexible, and maintainable solution resulting in a lower TCO. |
With Pioneer Solutions as a partner, commodity and energy trading firms have the opportunity to reinvent themselves, transforming their traditional business model to an intelligent enterprise by leveraging Pioneer’s next generation C/ETRM solutions.
