Powering your future in commodity trading How digital transformation can better fuel the way you operate in the energy market 1
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Powering your future in commodity trading The market is in flux Never before have we experienced such pressure on the way that we source, supply and consume energy. Political changes, such as growing tensions in Korea and the Middle East, Brexit and policy shifts in the USA, are forcing market participants to become more agile and adaptable. The question is not whether to take advantage of these trends but how to embrace the promise of tomorrow while maintaining and maximising the systems that keep the lights on today. It s a challenge that we re working with the biggest players in the energy market to solve. Here we ll share what we ve learned along the way and show you how we are helping to super-power the future of energy trading. What you need While challenging, a more volatile market presents opportunities to get ahead of the rest if you understand what drives competitive advantage today. From our deep understanding of the energy sector, we ve identified the three fundamental traits of businesses primed to thrive in today s market: Efficiency: Your traders need to be able to turn on a dime, free from cumbersome and time-consuming systems and processes that increase costs and slow the introduction of new products and services. Agility: Rapid changes in the market require you to adapt constantly, which is tough when teams are working from different systems. You need the maneuverability of a speedboat, with the engine of an oil tanker. Data-driven: All that data you have is pointless unless you can make sense of it. Advanced analytics made possible by automation and machine learning can give your traders the right information at the right time, so they can make faster, better-informed decisions. How we do it We help organisations across the entire energy value chain, including three of the four major integrated oil and gas companies, some of the largest utilities in the world, transmission and market operators, marketleading energy data providers and cloud commodity trading platform providers. It s a varied bunch, but they all have one thing in common; we re working with them to digitally transform their businesses and improve efficiency, agility and analytics across the organisation. 3
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Powering your future in commodity trading Efficiency Help us to maximize uptime while scaling at speed An integrated, international energy company with major interests in energy production, supply and storage throughout the UK, Ireland, and North America had ambitious plans, yet faced operational issues with its trading and risk management platform. This negatively impacted trading, slowed the introduction of new products, and increased costs across the business. How did we help? We provided a team of over 120 people, based on- and offshore, to help stabilise the end user environment, keep the systems available and surface data quickly. We then delivered a major upgrade to the company s Commodity Trading and Risk Management (CTRM) platform from OpenLink. CTRM platforms are used by many of the world s leading energy organisations, and are essential to their daily ability to trade they re the workhorse of any trading team. At the time, the industry was awash with horror stories of major overruns during platform upgrades. However, we delivered in just nine months, making Avanade the first in Europe to successfully execute a CTRM system within this timeframe. What did we achieve? Over six years we ve helped the company improve uptime, reduce incidents and increase trading volume by a factor of 10. The client is now preparing for a further 30% growth in trading volumes. Our work together means: Traders can trade for an extra 17 minutes each on average per day. The speed of trade consolidations has increased by 43%. New product introduction has been automated, allowing our client to introduce over 60 new products. Incidents have reduced by 64% and platform uptime and system availability are now both over 99.9%. IT used to be the bottleneck on anything that needed to get done. Since working with Avanade, we have a track record of meeting business needs. It is now an asset that gives the business confidence to explore opportunities. Avanade client 5
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Powering your future in commodity trading Agility Help us respond to customers quickly and effectively One of the largest and most successful energy trading organisations in the world faced challenges due to different customer management applications across the business, which didn t work together. This created confusion over customer records and master data, and a lot of wasted time entering and re-entering data. How did we help? We helped the business to change how it responded to customer demand, creating consistency across all of its customer channels. We also deployed a single global customer relationship management (CRM) solution based on Microsoft Dynamics to improve visibility of its customer relationships across its business. As well as providing one unified source of customer data from over 20 countries, the new solution allowed it to record every interaction across a variety of touchpoints, enabling better, faster service to customers. What did we achieve? At one point teams were separated by departments and geographies. Now the company works as one global team. The system has also helped the company to better understand its customers, through a detailed contact map that displays all the ways customers have engaged. Traders are now able to capture customer interactions and analyse stored data. This has helped them to better understand and grow customer relationships and created new opportunities to proactively win additional work. What I really appreciate is the agile way we are working with the CRM project team. As we are learning more about what the solution can do, we are able to continuously develop it and improve our functionality. Dynamics CRM allows us to implement changes in a very flexible and dynamic way. Avanade client 7
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Powering your future in commodity trading Data-driven Help us to predict the future of the market The rise of renewable energy sources like wind, hydro, photovoltaics and the development of the smart grid have had a significant impact on power trading. Intraday power trading is becoming increasingly volatile with significant gains to be made, especially when trade signals can occur rapidly and the volume of information available to traders needs to be acted upon almost instantly. We ve been working with a European energy trader to help it make sense of the data at its fingertips. Through real-time automation and integration we are helping the business to find new ways to process data at an application level, quickly and intelligently. How did we help? We re enhancing the way the company trades using a scalable analytics platform alongside machine learning that automates trade. Via APIs with the exchanges, these new platforms allow traders or bots to analyse vast amounts of data at high-speed while continually learning how to better predict what the markets will do next. With our client, we ve designed a working pilot Energy Forecasting model that can be deployed on the Microsoft Cloud. By using agile delivery and DevOps, we ve managed to set this up in quick time and at low cost. Furthermore, the Cortana Intelligence Suite provides advanced analytics tools through Microsoft Azure, such as data ingestion, data storage, data processing and advanced analytics components. These are all essential elements for building a demand forecasting and price optimisation solution. What did we achieve? While it s still early on, initial testing has shown an increase in the speed and accuracy of the demand forecasting models, while traders report a higher degree of confidence in the predictive data. This data is already driving an increase in automated bot trading in the intraday spot markets. The stronger a company s commitment to analytics, the higher that company s performance. Winning with Analytics, Accenture and MIT study, 2015 9
Powering your future in commodity trading Why energy trading organisations choose Avanade Avanade is a successful joint venture formed by Accenture and Microsoft in 2000. We are the world s largest and most successful systems integrator and digital innovator, recognised by Microsoft as its leading Global Alliance Partner in 2017 (and for the previous 10 years). Our work and expertise spans the entire industry value chain, and we have gained unique credentials and in-depth knowledge of helping businesses overcome the challenges facing the energy market. These credentials include: Enabling traders of one of the major integrated oil and gas companies to trade more efficiently each day by implementing a modern trading and risk management platform in nine months. Supporting rapid global expansion by taking over the product development, management and support of a world-leading cloud commodity trading platform. Improving global collaboration in a large supermajor by implementing a single marketing and origination platform, increasing customer intelligence and raising sales conversion rates. Improving customer engagement via a singular digital marketing interface, streamlining the content release process, shortening content release cycles and raising website traffic growth by 160%. Delivering a cloud-based customer experience globally in 30 markets, which provides enhanced modelling to the customer, allowing them to visualise, value and benchmark energy projects and companies more efficiently. Our specialist expertise We ve designed, implemented and managed solutions across the entire energy trade lifecycle and built up a number of deep skills over the last decade, including: Modelling complex bespoke gas contracts. Improving end-of-day valuation performance. Managing end-to-end trade solutions on the Openlink and other Energy Trading and Risk Management (ETRM) platform. Interfacing to internal systems, external data providers and exchanges. Providing deep insights using advanced analytics and machine learning. Using our environment knowledge, proven delivery methodologies and automated DevOps techniques, we have fundamentally changed the pace, quality and consistency of the application delivery model. We are able to deliver a flexible, reliable and scalable trading platform in rapidly changing markets. Working seamlessly as part of your internal team, we provide global 24/7 delivery and support service using a combination of local experts alongside our offshore teams from our global delivery network. With 30,000 people and over 24,000 certifications in Microsoft technology, few vendors can match us when it comes to having the specialist skills and resources needed to deliver large-scale and complex transformation projects. 30,000 skilled professionals 29% of whom are women 46% of Global 500 companies as clients 10,000 projects with 4,000+ global clients 18,500 Microsoft-certified professionals 15 centers of excellence with specializations in Cloud, Dynamics, CRM and more 10
Don t just take our word for it... We pride ourselves on the results we achieve for our clients. Here are just some of the views they have shared with us: Avanade demonstrated a flexible approach, a willingness to work with us and do what it takes to make us successful. Avanade is well placed to help us transform our business and create value over the coming years through new IT approaches. As our partner Avanade will play an important role in managing our product development and maintenance, end-user support, assisting with our roadmap development and future expansion plans. You couldn t tell who was working for whom, they were one team with common goals. And when new or expanded teams were needed, Avanade spun them up quickly. Their determination to hit the go-live date was impressive. Chris Bingham Head of Resources Avanade 30 Cannon Street London EC4M 6XH Phone +44 (0) 7789 543307 christopher.bingham@avanade.com North America Seattle Phone +1 206 239 5600 America@avanade.com Asia-Pacific Australia Phone +61 2 9005 5900 AsiaPac@avanade.com South America Sao Paulo AvanadeBrasil@avanade.com Europe London Phone +44 0 20 7025 1000 Europe@avanade.com Avanade is the leading provider of innovative digital and cloud-enabling services, business solutions and design-led experiences, delivered through the power of people and the Microsoft ecosystem. Majority owned by Accenture, Avanade was founded in 2000 by Accenture LLP and Microsoft Corporation and has 30,000 professionals in 24 countries. Visit us at www.avanade.com. 2018 Avanade Inc. All rights reserved. The Avanade name and logo are registered trademarks in the U.S. and other countries. Other brand and product names are trademarks of their respective owners. 11