5 Benefits of Modern CTRM Software
October 28, 2019
To say that commodity markets are volatile is to understate just how unpredictable commodity trading can be. Constantly shifting trade agreements, political upheaval and climate change are just three drivers of volatility. Trading partners change rapidly as political situations shift, shipping prices soar as oil prices increase, commodity prices plummet as refineries come online, bumper crops drive oversupply of products – and profits evaporate.
The cost of using legacy CTRM
Legacy CTRM software was designed to handle the complexities of commodity trading 20 years ago using the technology available at that time. Decades later, technology has evolved. You now have access to real-time data, machine learning, AI, mobile, blockchain, and more. Today’s computers can analyze data in seconds, so you can run reports instantly instead of waiting for reports to run all night. This enables real-time insight, but only if you take advantage of it. Commodity trading companies need to take advantage of modern technology to thrive in challenging markets.
There are significant benefits of replacing your old commodity trading and risk management system with a modern, technology-rich CTRM system.
Get up to speed fast with rapid implementations and user-friendly interfaces
Modern CTRM software is cloud native, enabling exceptionally short implementation times without sacrificing functionality. Many companies hang on to their outdated legacy CTRM software because they fear the long, painful implementation of a new one. They work around the gaps in functionality and adjust their work processes accordingly. But this is a waste of time, resources, and opportunities.
Today’s cloud-native CTRM software can be implemented in half the time of traditional on-premise systems, delivering exactly the functionality you need quickly so you can gain efficiency, insight, and business improvements fast. You get the customization you need without purchasing new hardware or requiring extensive work from internal IT teams.
Not only are modern CTRM systems able to go live fast, they are designed to be easy to use, with intuitive, straight-forward interfaces. With tools like natural language processing, users quickly learn how to use the systems so they can quickly take advantage of all the new features to enable smarter trading decision.
Use more data to create accurate insights
A modern CTRM system aggregates and analyzes data from multiple data sources, which is a huge shift from legacy CTRM software that uses only data created in the CTRM system. Modern systems automatically collect data from across your entire value chain – real-time, historical, structured, and unstructured data from ERP, accounting, spreadsheets, weather forecasts, and more – to create more accurate insights and enable you to make better trading decisions.
With real-time data, you can analyze the impact of dynamic market movements quickly, gain a clear understanding of your business, identify areas of concern, and plan accordingly – doing in minutes what used to take days or weeks. Automated data streams eliminate errors in collecting and aggregating data for analysis, so you spend less time creating reports and gain insight faster, enabling you to capitalize on opportunities.
Increase efficiency with automation
The power of connected data isn’t just creating better insights faster, it’s also about gaining efficiency. With automated systems, modern CTRM software aggregates data without manual intervention. Trading companies no longer spend hours, days, or even weeks collecting data and manually inputting that data into spreadsheets to run reports.
The time saved by automating data collection is time that can be spent doing other, more valuable tasks – evaluating trends, exploring new markets, etc. Time spent collecting data is time wasted when automated systems can do it better, faster, and without mistakes.
Improve risk management
Modern CTRM systems provide a current, accurate, and complete view of exposure, pricing, market conditions, and more, enabling more effective risk management. Real-time data, analyzed quickly, ensures that commodity trading companies stay on top of risk drivers.
Solutions like Eka’s provide real-time alerts, so you can get notified instantly when risk limits are breached and take immediate action to address problems.
Improve data security
Years back, the idea of cloud services caused many companies concern. How could your data be safe when it’s not tucked behind your company firewall? Over time, companies realized that services like AWS employ the most powerful security possible, enabling a level of safety impossible to achieve in your average company data center.
At the same time, cloud-based services deliver 100% redundancy, so your data can never be lost or made inaccessible because of an outage or disruption in one location. If one location goes down, another has a duplicate of your software and data to ensure you can keep working.
There are many more examples of the advantages of using modern technology for commodity management, including how AI and machine learning improve decision making and how you can drive profits by customizing the perfect CTRM system for your business. If you want to compete in today’s volatile markets, it’s time to take advantage of modern technology.
Mary DeFilippe spends her days creating engaging content – blogs, white papers, articles, and more – that helps readers better understand new technology. She can frequently be found walking around the office listening to heavy metal music while pondering ideas for her next blog.