I moved home this weekend. To say it was stressful is an understatement. The amount of ‘stuff’ accumulated by two full grown and three small humans was almost embarrassing. But I looked for a silver lining and I found it. This was an excuse for my family and I to ditch the junk and take stock of our personal belongings – what do we have and what can we trash?
The same thing could be said for data. How it’s managed is crucial to its validity. Across many industries, data has become an exceptionally precious and challenging resource to manage. This is especially true in the commodities industry, where big data has created new opportunities, delivering benefits to small and large trading companies and the customers they serve. But it’s also brought on another set of challenges through an increase of data silos.
Users of older risk management software have done well in extracting data into Excel for analysis. These users have created bespoke workarounds, which eventually get the answer they seek. However, in the current world of big siloed data, extreme volatility, and supply chain disruptions, are these types of Band-Aid solutions giving any company the edge?
If data was consolidated, cleansed, analysed and reported quicker with increased accuracy, would there be more opportunity for commodity traders to increase the number of profitable trades? Would risk managers be able to further minimise risk whilst ensuring maximum profitability? Would logistics professionals be able to further optimize routes, storage and modes of transport? If the answer is yes, even if it’s a 1% improvement, think about the impact it could have on the business.
Data and CTRM Solutions
Companies that leverage internal and external data are able to make quicker and more accurate decisions and will gain significant competitive advantage. It is no longer acceptable to expect CTRM solutions to offer the standard system of record capability for companies with commodity risk exposure. Whilst capturing of data is a core part of CTRM solution, that’s just scratching the surface. Today’s CTRM solutions are equipped with advanced analytics, AI, and machine learning, enabling faster adaptation and long-term and automation of tasks to reduce risks and increase profitability.
As the world becomes more volatile, margins tighten and environments get more challenging, users, management, and boards within the commodity trading and risk industry need technology to work harder for them to keep pace with market changes, without missing a beat.
On a side note, we’re settling into our new home and everything is well organized. My kids know where their Lego sets are and I finally found that hedge trimmer I misplaced years ago.
CTRMCloud offers CTRM as a service, allowing for data to be collected, analyzed and reported in near real time from all areas of the business. Contact us to learn more.