In a recent set of conversations with Gen10, we discussed the so-called 3D trends of decarbonization, decentralization, and digitalization in commodities. A previous blog dealt with Gen10’s views on decarbonization. In this article, I cover the discussion with Gen10’s Richard Williamson about decentralization and its impacts in the CTRM/CM software category especially in the light of lockdowns and a home-based workforce.
“In terms of resources, hardware, and getting the software to each individual workstation or office location, then Cloud-based SaaS is definitely the trend,” he told me. “ The advantages have long been proven in terms of cost savings in infrastructure, maintenance and support in-house, in terms of security of data and access to it, business continuity and disaster recovery; not only does it deliver on the promises above, but it also creates an environment for accelerated innovation – tapping into services like satellite data and mapping, APIs to leverage and integrate with a wider ecosystem. As an example, it took us around two weeks to provide vessel tracking functionality integrated with Google Maps to our logistics module. Prior to the move to the internet/cloud, such a task would not have been contemplated, let alone feasible. So the value it creates in terms of efficiency and control – keeping a closer eye on your laycans and demurrage risk compared to the cost is just fantastic.”
However, with many workforces working from home and continuing disruptions around lockdowns, he thinks that for the moment anyway, there are other priorities. “However, Innovation right now probably isn’t the priority. It’s the survival and subsistence concerns like business visibility, control, and getting teams to work better together while stuck at home. It’s proving to your finance providers that you have the systems, checks, and balances in place to ensure the safe passage of their cash. This also has an impact on risk and particularly operational risks,” he says. “Operational risk has been creeping into the limelight for a couple of years now but has been shot to the top due to the repercussions of this virus. This is of course a big problem for those CTRM systems that have been more focused on price and counterparty risk, leaving much of the day-to-day business to spreadsheet workarounds and email threads.”
He also sees obvious concerns and issues around managing a home-based workforce. The transition to a home-based workforce basically requires some changes in the way things are done and will drive a move to commercial systems with proper security of access and automated workflow. “The verbal and paper workflows once facilitated by open-plan offices are no longer an option. Spreadsheet controls and email threads are not only now inefficient, but they are riddled with risk,” he said.
In our recent whitepaper, ComTech highlighted some of these trends and focused on the impacts of home-based workforces in particular as well as expressing concerns over training and staff development. The need for more automated workflows and tools is clear and certainly appears to be driving commodity firms to search for solutions to replace paper and spreadsheets. As Richard noted, “the decentralized/distributed workforce/Work-from-home shift, courtesy of COVID-19+, has most certainly been responsible for the surge in demand for cloud-based E/CTRM platforms from both large and small trading firms. Our collaborative tools such as workflows, document handling, and to-do lists are really resonating. And the financial and credit controls we provide are seen favorably by finance providers.”
