Eka Digital CM Platform and the changing CTRM technology paradigm

Last week, we had the opportunity to visit with Mr. Manav Garg, CEO & Founder of Eka, to discuss the company’s recent results, announcements and new developments.

Referencing recent Eka press releases, Mr. Garg noted that Eka has already closed deals with 16 new customers in just the first half of the year for their Digital Commodity Management (CM) Platform, with 12 of those sales also including the underlying E/CTRM solutions that works on the platform in the form of apps . To support the growth reflected in those new customers numbers, they’ve expanded their workforce by 70 new employees, primarily in the areas of engineering, technical support and customer services.

In discussing the success of the Digital CM Platform, Mr. Garg indicated that the buyers of Eka’s solution have been looking for something other than the traditional monolithic solutions that have dominated commodity markets for years. With the Digital CM Platform, he notes that those buyers can easily acquire and quickly deploy only those capabilities that they require for their current business – and in doing so, can potentially realize an almost immediate return on investment…and, as their business grows and evolves, customers can add additional functionality and capabilities (from regulatory compliance to business partner connectivity) in the same rapid manner.  He notes that with this approach, which Eka terms “digital commodity management”, buyers can also add significant new capabilities to improve their commercial performance, while leveraging their existing technology investments in ETRM/CTRM/CM solutions (regardless of vendor), internal data sources (other systems or even spreadsheets), and external sources such as price feeds.  He further notes that for those seeking new or replacement core ETRM/CTRM solutions, the currently available E/CTRM solutions from Eka can be deployed and functionality added via the platform to best match any customer’s business requirements, eliminating the potential burden of unwanted or unnecessary functionality that may be part of a traditional monolithic solution.

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We were also provided a demo of the Digital CM Platform and it’s clear to us as a result that Eka has indeed created something quite different – a solution set that leverages the now familiar concept of “apps” to provide a number of discreet and high-value functional capabilities across multiple commodities and industries.  With an API to the underlying transaction capture system (either Eka’s or a competing solution), the cloud-based platform aggregates data into a NoSQL database, enabling rapid processing of all types of data – both structured and unstructured.  It also employs an in-memory database to ensure that calculations are fast. Workflow and audit trailing are fully integrated in the platform.

Eka has already completed connections to more than 15 different systems including ERPs, Market prices, accounting etc, and though connections to other ETRM/CTRM system may require some development, once connected to the Eka platform, the available pre-built apps can be downloaded and immediately deployed. The solution also includes the ability to rapidly build out new connections via the provision of tools for users to map target data structures of their internal systems.

The currently available apps include connections to external data sources such as price feeds, position management and PnL tools, risk capabilities such as VAR and credit risk, pre-trade analytics, raw materials margin analysis, basis analysis, regulatory reporting and traceability…. among about 50 apps developed to date (you can see the list of available apps here – https://www.ekaplus.com/solutions/eka-app-store).

We believe Eka’s Digital CM Platform is well-positioned to capitalize on a trend that we’ve been seeing emerge over the last 12 to 24 months – a push to deconstruct the capabilities of traditional monolithic ETRM/CTRM/CM systems. Under this new deployment model, the relatively common transaction capture/data management capabilities are separated from complex business process modeling and high-level analytics, allowing users to right-size their critical systems and select only the risk and analytics capabilities most valuable to them.

We had previously described this approach as “CTRM as an Architecture” (see ComTech’s whitepaper on the topic here), and a growing number of other vendors, including Generation10 (who have adopted the term “ecosystem approach” to describe their offering and have developed an integration platform and a number of functional modules or apps), are following a similar path.  A related, but somewhat different approach is evident in solutions offered by the “platform” vendors, like Beacon, who provide commodity-specific components that tightly integrate with ERP solutions.  And finally, there are several new cloud-native offerings currently emerging that focus on very specific functional or analytic niches (i.e. risk metrics such as VAR, PnL and others) that involve uploading business data to a web service and receiving analytic reports.

The industry is changing rapidly (as noted in our recent Disruptive Technology report) and firms are clearly seeking to improve the agility and flexibility of their technical infrastructures to more quickly adapt, and even profit, from these changes. Increasingly, our interactions with prospective buyers indicates growing numbers of firms are seeking the increased flexibility to select and deploy agile components – generally commercially supplied, but sometimes supplemented with internal builds of discreet functionality to address any gaps that may exist.  Ideally, this ecosystem of discrete applications and interfaces would reside in the cloud and provide the ability to leverage existing investments in any legacy E/CTRM/CM solutions that may be in use.

Regardless of what term is used to describe it, we do believe that Eka’s Digital CM Platform is advancing this new paradigm. The company’s success to date is tangible evidence that the trend is picking up steam and could cause significant disruption to the traditional ETRM/CTRM solution business model in the not too distant future.

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