Episode 13 - ETRM Mini-Series with Inatech

Chris Sass and Martin Hiller (Hosts of the ETRM Mini-Series) are talking to Alok Sharma (SVP Global Commercial & Business Development) of Inatech.

"We combine best-of-breed cloud technologies with our in-depth industry expertise to enable companies to integrate, automate and optimise business processes, driving efficiency and revenue growth.
Our customers benefit from an international delivery model that provides the competitive edge needed to thrive in today’s dynamic markets.
As part of its oil division, Inatech benefits from the knowledge and expertise of Glencore in oil trading, hedging and the management of the entire oil supply chain from exploration and production to retail and distribution."

To get more insights about all the vendors that participated in the ETRM Mini-Series, check out https://insidersguidetoenergy.com/energy-podcast-education/etrm/

If you want to find out more about Inatech, click https://insidersguidetoenergy.com/energy-podcast-education/etrm/inatech/

Transcript

 | Timestamp | Speaker | Transcript

| 13:09.70 | chrissass |  welcome to insider guide to energy ETRM miniseries today we're with Inatech I have Alok Sharma with us. Alok welcome to the program.
| 13:22.80 | Alok Sharma | Thank you very much chris and Martin a pleasure to be here.
| 13:26.70 | chrissass | So look. Maybe you could start by helping our audience understand a little bit about who you are and who your company is.
| 13:33.48 | Alok Sharma | Indeed so Inatech is a global ETRM and provider. We are a small part of Glencore the trading group and we've been around I think in many forms for the past 30 odd years you know as. As the coat hanger changes to merges and acquisitions. But it's in in its current form. We've been around maybe for 8 years and we're active in the hydrocarbon space and increasingly in the renewable space also for the past twelve months in the power and gas space. Really energy. Yeah, urms front to back is our core focus and we're based out of london.
| 14:14.67 | chrissass | True based out of london well fantastic and so I think just to be consistent with the rest of these ETRM Miniseries what I've asked. Our guests is I've gone across the spectrum and said look in my perspective e 2 m is a very crowded space. There seems to be a lot of noise. There seems to be a number of startups. Ah, the big legacy companies all seem to be reinventing themselves or doing something different and so with this premise we put this mini series together and what I asked from your vantage point is have you seen changes taking place in ETRM and if so what kind of changes.
| 14:48.12 | Alok Sharma | Sure so there are few that you know come to mind straight away. Um I'll mention a few I mean the first 1 to me is explosion of data right? Um nearly ninety percent of all data has been created in the past 3 years data saturation is everywhere. Why is it important to us. It's because essentially that's what ETRMs do they? they they analyze process and deliver insights from from data and you know the Rapid rapid rise in our ability to collect and store data. We believe has not been managed by our ability to support filter and filter. And analyzed it. So so for us our solution needs to be ready to accept and adopt new sources of data. You know I'll give you a small example of something that we've just done um the compliance of ships so all energy energy trading companies are using ships. To move oil or other products from or gas from place 1 to another place compliance of ships. Ah the bimco is now containing the ais clause banks are not financing transactions involving a ship that has turned off its Ais. So you know we've just had to literally in the past you know twelve months interface into ais to make sure that we're actually tracking the ship that is carrying the cargo from a to b and that you know Ais has been switched on so there is a kind of compliance angle to there right? So ETRM. Have to be ready to accept vast amounts of data as as a plugin I think that's that's the first trend that we've seen um, moving on I mean I would say kind of the change of markets right? What happened last summer if if we remember was you know wti went negative right. And that mostly broke a lot of valuation models that were and that were based on black and sho black and sh basically looks at you know asset values that are more than zero. So you know immediately? What everyone started doing at that point was responding to the market and say hang on guys. What do we do here in a market that could actually go below zero and then you know we'll perhaps get into it later on in the in the show but those needed to be replaced by. You know, displaced back or or baccale or whatever models. You know the clients chose. Um. The third point I want to make real quickly is a change of the user. You know we are now dealing with what I call because I'm old I call it the uber generation right? folks that have just come out of university you know, really smart people. Ah on the trade of trading floor and they look at.
| 17:34.74 | Alok Sharma | Some of the systems that have been around and you know sort of cry right? I mean why are these gray screens looking at us and you know ninety percent of the real estate is something that I can't even use and you know then you press to save go on to the next step I mean it could be quite mind numbing so we have to Respond. You know we have to respond to that particular need and we have to make sure that our design is is is user user, friendly and the last thing I'll say here is is what I guess everybody is talking about which is the decobonization. You know the the fit for 55 a lot of the companies are now beginning to. Get into renewables and bio and that vastly changes the operations and the risk you know and the accounting framework. So to me all those changes are what make the market more exciting probably more than ever before and you know that's the market in which. We we. We sort of thrive.
| 18:34.47 | chrissass | So so it sounds like that. There's there's a number of changes and I appreciate your your stepping back and looking that um, let's let's walk through them a little bit. You started with data and you gave us an example which. Didn't sound like creates a doubling of data. You said hey here's here's an example right? you need this information from the ships and you had to integrate into something so the doubling a data. What's driving that where we're you know? So I think you said in 3 years perhaps it's doubled or it's it's some incrementally larger number of data.
| 19:02.58 | Alok Sharma | Sure it's It's the user needs. You know it's we all know that trading. Ah you know historically is has been well you know low margin right? I'm just generalizing here but essentially.
| 19:04.83 | chrissass | Which would specifically cause us that.
| 19:20.91 | Alok Sharma | What is happening is that the the window. But as as let me put another way most of the producers are now also traders right? They they realized you know that the the traditional role of a trader being the sort of you know connector between the producer and the consumer is largely. Not there anymore. Most producers trade most consumers have a trade at a trading desk as well. What then happens is that the that the trading window for a trading organization is narrow and you need to then probably hunt for those opportunities so they are now looking at was streams of data. Be able to spot the trend either ahead of everybody else or be able to find that window of opportunity so that they can trade so you know 1 of the 1 of the paradoxes of energy trading and etrm systems is I don't think I've ever seen a trader use an etrm right. Um, it's generally you know you start with deal capture and and guess what's happened when you've had deal capture. You know the trader's job is largely finished. So so you've got to so you know so we've got to push the envelope and say what is it that would make. Somebody who is trading use a trading and risk management system. So all the data is probably coming you know from there. Ah, the market side of things and then of course as you go across the value chain. You know you start to get operational data. You know you start to get ah you know risk data. You know. Market risk operational risk currency risk all of that there are various data sets that folks want to plug in just to be able to see their position versus the market and that's where you know an etrm um can help because it has the workflow built into it. You know it can be the the sort of. You know the the fish bone on which everything else hangs.
| 21:13.21 | chrissass | Got it.
| 21:14.52 | Martin | So Yeah, that I will completely subscribe that data is more and more important in trading activities. But in that context I'm a bit curious Now how um in a tech solution works I mean usually what I've seen and what is I think quite common in. In trading organizations that they have for the purpose of data management. Potentially a separate system Maybe In-house built or a different vendor that provides them with a data management solution. Um, so is it then. The case that the Inatech Etm solution Also acts at a data management solution that can not just consume like time series Data Deal Data static data but also store or collect store capture validate those kind of data. And then distribute those data.
| 22:11.38 | Alok Sharma | Correct I mean that's that's where we're going. You know where are we there yet 1 hundred percent probably not but what we can see is that you know certainly for 1 of our customers. We've got this and I'm not a technical guy but this data lake concept right? You know where you've got.
| 22:26.77 | Martin | This is.
| 22:30.34 | Alok Sharma | Pools of data sort of coming into 1 place and then they run their I s there. You know the the tableau the clickpuw you know the sort of farbi. Whatever tool you've got they run that on top of that data lake because silo data just creates inefficient. You know, inefficient decision making yeah and at the end of the day and this is perhaps another month or of hours you know, effectively an etrm um started as a workflow system right? So that you could bring somebody fresh off the university and train them. Into doing the various steps but has evolved into a decision support system right? right? Now we are very different. Maybe maybe you know 2 decades or 3 decades on from commodity trading. We are a different level of sophistication and and and what people require.
| 23:13.24 | Martin | Yeah.
| 23:27.76 | Alok Sharma | Is not just don't just tell me what to do but also offer me some insights right? The system should be intuitive enough so you know that the classic case of let's just create a system and then bookend it with some reporting on 1 side on and on the other is just. Is not exciting anymore because no 1 wants to look at an excel report at the end of the solution right? They want alerts through the Workflow. So that's where I think what Inatech is trying trying to do is we're trying to look at it from a holistic point of view understanding that an etrm. May not be the only solution. In fact, in most of the cases probably not the only solution certainly for large traders but holds that essential workflow of which various systems can plug in and contribute onto it right? That's kind of the way that we are. Ah. We see the market involving.
| 24:24.31 | Martin | Okay, so you may be curious now about the whole topic Data management. So you mentioned this data Lake that debate for built for a client is that a custom solution that only that client is using or. Do you provide then maybe a module as part of the Etm solution that acts as a data management module and client can decide whether she wants to to add this as a module or mean how how do you cope with that in that context.
| 24:58.58 | Alok Sharma | So the the the right answer Sir Martin is it's horses for courses right now right? We would love to standardize it right? But right now it depends on the sophistication level. It depends on the you know proprietary nature proprietary nature of everybody's information. So.
| 25:05.37 | Martin | Um.
| 25:16.60 | Alok Sharma | I want to be able to pull the plats curves but I want only my people to see my curves. Ah so that's that's the sort of demand that we see so right now what we've done is for this particular client. We have created this this data lake and this concept. Ah, and you know I'm I'm a non-technical guy as you'll see but you know the the vision was given to us which was you know think of the data as ah, as ah as a bucket and and we want to be able to pull any data at any time you know so let's evolve the reporting from the fixed format. You know row and column based you know reports that are I mean they they just won't hack it you know because they're good for 1 scenario probably but I think all of us have been in commodity trading long enough to know that. You know that scenario will probably change you know next month so what do you do? then? you know what do you? analyze? then? so this this hangover that etrm um companies have of you know, give me your report now and then I will develop it. Yeah but 3 months later the business has changed. What are you going to do then. Gonna develop another report It's very static and so that's that's where we're moving to be able to and you know various tools I mean for another client what we you know they have this etl right? They and I think it's called the etl technology which is. Something transform and load. So basically click view and tableau which other the the the Barbie the theis tools out there are offering those um possibilities from a feature set point of view to say put all your data in there. You can then put. And m I s reporting tool on top of it and just you know run your insights from there.
| 27:11.39 | Martin | Okay, cool Thanks I think they got it now. Um, think we covered this whole topic data management fairly wide I mean at least I understood now in what direction you're moving towards. But maybe let's move or shift the conversation a bit. What I'm very interested is in. In what first of all the relationship between Inatech and glenco is I think there is quite a strong relationship and secondly up to my understanding and how I perceived in a text solution is that your core focus or core markets were. Um, the shipping and bunkering market but it seems that you decided a bit longer ago ready to to extend the range of commodities that you cover with your etm solution. Maybe you can bring a bit of light into those 2 aspects.
| 28:01.51 | Alok Sharma | Sure, um, so firstly yeah glencore we're a wholly owned Subsidiary. We are an arms distance company from glencore. That's usually the second question that I'm asked right? which is you know first is who are you the second 1 is you know how involved with glencore in your business but look. Um, if we if we just look at it from a let's say from a business point of view. Our business runs ah because clients use our solution and use it to run their business right? So it's it's principally a relationship of. Trust. And so glencore being a financial investor understands that that is the that is the base on which our relationship is built so you know the legal and the compliance frameworks are there but this is the way that our clients understand it that you know, ah. And the end of the day. The solution we work with glencore companies and with third Partyy companies predominantly third party companies actually across the space. Ah you are quite right? we work we started in the shipping and bunkering space right? that was where we started from. But progressively. We've moved into crude and refined trading. Um, we've probably 3 years ago moved into the wholesaler market in the us the gasoline trading pot the us we then moved into renewables right? So the entire gamut of emissions trading and all of that. And most recently through partnerships we've moved into you know, power and gas so you know as the business grows. You know we we definitely want to cover. You know the the liquid fuels the gas and the power that is our focus for the next 3 years and that's how we've kind of grown the company. Yeah.
| 29:55.33 | chrissass | So do you have a direct sales model or so you're you're talking about kind of a lot of partnerships and growth. So it seems like a pretty aggressive growth campaign. So what's your go to market How how are you reaching the customers.
| 30:09.46 | Alok Sharma | So We have a direct ah pretty much till now we've grown direct and you know we've we've sort of had a decent amount of growth I mean my boss will tell me it's not enough right? But that's that's ah, that's kind of capitalism for you. Um. But we've had ah a good amount of Growth. We've grown through a direct Salesforce. You know we have representatives in most of the major locations where the the trading hubs across the World. We have recently started partnering on the implementation side. You know, just because you know the Inatech Solution. At least? Ah, if I look at the tech old solution which is our you know sort of let's call it the oil trading solution. Um, we are covering really from trading right? among the tax right? So trading Operations risk inventory settlements accounting finance and tax. And what we found is that certainly on the on the ah accounting and finance side of things you know there is a lot of localization that needs to be done on a solution. So we've we've partnered with with you know companies that have ah more knowledge or a better local knowledge. About things like tax certainly in the Us And so implementation we are open I mean it could. It's normally us but can also be you know another ah company who might be better placed. But for the sales model is still very much direct.
| 31:39.91 | chrissass | Okay, so so you have this direct sales model you you talked a bit about partnering some more in here. Um, and so you know I get if you're coming from the hydrocarbon Space. So What's pulling you out to power and gas I mean what? what is making that transition. Are you. Customers driving that or is it just a ah growth plan.
| 31:58.79 | Alok Sharma | Yeah, so a bit of both right? a bit of both a lot of our customers because I mean let's be be spoke about decarbonization I mean let's be clear in maybe 1020 years everything is going to be electricity right? That's that's kind of just the way that that everyone is headed. Obviously there'll be a few transitions you know so you're not going to go straight away into it. But you know ultimately the oil will flow to probably power a factory that is producing batteries or something or something like that so we need to start now. And we're doing that to sort of you know, active partnerships we need to start now to understand the power space and to really try and innovate in it. We are new right? I'll be I'll be clear. That's not where we are starting from but it's ah if we want. To be you know, sort of an energy provider an energy tr m provider then we've got to look at gas and power because that is the you know that's the sort of a large amount of the customer base and a very active customer base right? As as you both would know much better than me. So so that's ah.
| 33:11.50 | chrissass | Awesome! Thank you.
| 33:12.19 | Alok Sharma | That's where we headed.
| 33:13.39 | Martin | Okay, great. So understand that it's your first years now empowering gas um and trading and building functionality to your clients. But maybe you can give a bit of an insight where you stand along that roadmap. So. If I think of power and gas trading. Usually it's it's from an organizational point of view of trade has split in short-term and long-term trading and obviously short-term trading has much more requirements to cope with the the volatile prizes and volume forecasts. Where you need then also a real time for example, real time position management module and of course a robust risk management that has the right risk key figures in place and the system is able to calculate and monitor those numbers. Maybe you can? um so. Describe a bit what kind of sophistication level. Your solution is not providing to power and gas traders.
| 34:14.78 | Alok Sharma | sure sure so as you would imagine you know we we need to be cautious. You know as we go in there because it's a mature space. There are a lot of providers already in there. Some of them. It would no doubt be on your show. So for us. There are 2 things that are important firstly. Will be the wholesale trading that we start with right? Not the not the retail part because the retail part I heard is now in I used to think fifteen minute segments is what everyone does but you know apparently five minute segments is is how it's trading now. So the retail part of any. Um. And it's similar what we did in gasoline you know in gasoline as well. We went into wholesale first and then we went into the into the convenience stores right? which is the retail side in the us Market. So using the same tested Strategy. We're going to be in wholesale power First. So. Looking at your bpas and and and and and things like that and the other thing which we think we are you know well capable of doing is is valuation of the of the risk right? or or valuation and and the mark-to-market side of things so you might have your scheduling on an iso or on. I think in the us it's the iso you might have your scheduling on through another system. But ultimately you know tech all will be able to absorb your positions and be will be able to Mark to market them and you can sort of conduct your risk management from there. That's kind of where we want to go in first obviously with existing customers First right? we we we we are not we we don't want to just suddenly change our strategy. We are probably right now. Very I want to say oil and gas driven right? So we want to continue that. But with existing customers who might have you know a power desk that is you know 1 or 2 folks just doing you know power on another system. There is a possibility of of absorbing that we are under no doubt then I'm under no doubt that that is a. It's a change of dna right? And that's how I I speak to you know our our teams because the user experience is very different. You know the user and and we are very driven by user experience. So you know, ah a power trader will look at an oily trm and probably laugh or maybe cry I think. Think they're going to cry right? so because ninety percent of the things are not relevant to them. You know gas the same thing you know I need to know where it is where it's going what the rate is that's it I don't need a whole host of other information required. so so that's
| 37:02.27 | Alok Sharma | That's you know we're taking ah a measured approach to that and that's an evolution I say it's not a revolution but it's an evolution of Inatech into that space. Yeah, that makes and I mean you know more more about this than me do does that make sense or.
| 37:10.84 | Martin | Yeah, understood and gas and power is definitely more standardized. Entirely I mean I think if you you can somehow in that context ah group power and gas in ah in a similar class and that is for me completely different if I look at the market dynamics and the way.
| 37:19.83 | Alok Sharma | What do you think.
| 37:36.60 | Martin | Products are traded compared to oilland and and Bunker and shipping markets. That's definitely and and and development understand that you're at the beginning and was ah what it was understood is that you grow. Capabilities for power and gas trading within your system with your users. That's I think 1 key message that I heard out of it and in that context you mentioned the ppas I think that's a very very interesting um topic that is driving especially Europe as Well. Um, so again there what is your I mean that your solution providing in there I can see that other players other vendors in the market also developed their system further to be able to capture those complex structures which ppas can be. But also be able to capture the hedges and that they might conduct in order to manage risk well and what also is very important there and complex is then the validation and the risk management when it comes to Ppa. So Maybe you can out and a bit along the ppas. Um, what kind of capabilities and so functionality you are providing currently.
| 38:52.66 | Alok Sharma | Sure so I think from the onset you know I talk I talk a little bit techy here right? We're not going to enhance anything. We're gonna it's gonna be a ground up separate development probably driven through a partnership that that sort of exclusively caters for power. Because we we cannot modify. You know we I think it's probably stating the obvious but you cannot incrementally modify an oil etrm to cater to power. It's a much faster mechanism. The the ppas are of ah of a complex nature. You know the the various. You know the grid right? If you absorb the grid because the metering of the grid is is such that you know it's very regulated right? The industry is very regulated and 1 can only trade off of those particular you know of those particular points. So for us. It is a brand new development. Um, on the risk side. You know the the interesting thing for us is that you know what we found is on the 1 hand. Obviously the risk is different but on the other the parameters are exactly the same right? So you want to see your. You know, but the expectation is that it should be near instant right? So I don't I don't nobody wants to see an end of day. You know we have in in the oil world. We have an end of day process that usually runs where settlement people get together. You know chris is laughing. He probably knows you know what? I what I'm talking about. There's an end of day. Process that kicks in takes about 2 ah 1 and a half to 2 hours right? maybe less ah in certain other organizations and that then produces the management reports for the management to then review the risk the p and l but you know all the positions etc. That's word, the power is a completely alien word. I took a position I want to see my where right there right? So how are you gonna provide it so those sort of prompts. It's the same thing that we used to. But you know you're talking about a different you know I would compare it as probably the role that. The cars the fast cars we drive on the roads versus the formula 1 cars right? It's you have to start thinking about it differently so I will admit that I'm not I'm not the expert in this space I sit in those meetings I'm myself am learning but it's it's very clear to us that it is not a. It's not just an adaptation that you know you sit down with a couple of users and you incrementally develop that functionality. So that's that's just my you know my my sort of gut.
| 41:36.70 | chrissass | So so going with your your evaluation here in the evolution and the change that you guys are going to um you have a legacy platform so architecturally where are you guys at from a platform. What what needs to change from what you've built so how is your. Platform deployed today and is is it in. Is it part of this evolution or is it already evolved.
| 42:00.12 | Alok Sharma | Yeah, so the platform is evolved I mean we we we were always cloud from day 1 right? So where our architecture our security our performance has always been you know on that so we don't really have a legacy if you say. But it is something that you have to constantly improve you know, ah technology is a bit like fashion. You know you're either too early or too late. You know so we have to constantly upgrade I mean it's interesting. We're going through the budgeting and planning exercise and you know we have those. Whenever the head ah the head of r d comes and says I'm reserving thirty percent of my capacity for architecture. You know you you worry right? you say are you sure he says yeah because if we don't if we don't progressively improve the architecture. You know we're not going to be able to offer the performance that users need. Because the expectation of the users from a system is it should be near instant right? That's just the you know the new generate or even anybody because we've got our mobile phones and we expect things to ping and be instant so we have to carry that along so for us it is ah.
| 43:01.88 | chrissass | Got it.
| 43:17.94 | Alok Sharma | Let's say we started with ah with ah on the right track but it is constant as we said we are thirty percent of our capacity goes into improving the architecture of the solution and you know I would easily say another twenty percent on on security and you know let's say non feature related aspects.
| 43:39.20 | Martin | And okay, great I Think that was really a great comparison the fashion and technology I Really like that in that context what I see in fashion now is um that or the the world or the Etm world is more moving towards microservice based architectures. Not everywhere. It also depends on the sophistication level of of the users at the end but I can see that some clients and some people working in the trading industry more and more have programming skills as well as traders or as quants. And they would like to maybe build their own services. So um, is that possible within the Inatech solution that you within Inatech solution build your own functionality or which is I guess still the more common way that you provide Apis and then allow. Integrate services that they've outside well with a Inatech solution.
| 44:39.55 | Alok Sharma | Right? So this is componentization right? which is you know you break soft breakdown software development into small identifiable pieces that allows folks to develop their own functionality. Um, well.
| 44:43.55 | Martin | Um.
| 44:57.36 | Alok Sharma | We have started by embedding python in our in our formula. You know whenever you have your formula or writing for your for trading. We started by doing that so that is already there. Um, it's a bit of a mixed message right? Martin I'll be honest because we look at ourselves. As the ultimate service holders right? That means if there's anything that is not not performing in the software or in the service because we we are sas then it is you know we we take responsibility for it. So there is that fine line that 1 has to walk. When everyone is deploying and supporting a solution that is you know, being being used real time globally in as in how much customization we allow and how much customization we can support so you know our our base will always be look some scripting. The formula side is Allowed. We can collaborate with our users and bring in you know so we have an active roadmap. Ah we do 3 or four releases every year and these releases are feature base releases so we are much more capable of creating that code. In the software and then perhaps switching it off for other clients right? So you create it as a configuration in the software and not a customization because a customization is a the poison chalice for a saas company. You know you can't. That's not the model if you start customizing so we are we consider ourselves in that space where we say if it's good for the rest of our customers. Let's put it on the roadmap. Let's develop it as a configuration and then if certain other customers don't want it. We can switch it off.
| 46:49.80 | chrissass | Okay, so so you productize whatever you can productize keeping kind of a quality of control approach throughout your your solution you give as much as possible to your customer. You have some python and some some capability to do some but for something pretty. Big You would probably want to have it in the mainstream product and then if you choose to switch it on you switch it on if you choose not to it switched off for you. It was what I heard you just say Okay, so so let's talk a little bit about the ecosystem you you alluded to partners and and bits and pieces of this already. You've you've just talked about kind of.
| 47:16.90 | Alok Sharma | Um, clear Yes, that's that's exactly it.
| 47:28.94 | chrissass | Components and breaking things down. So what kind of ecosystems already in place. Do do you have partners involved today and and how integrated are they like how how does a partnership work with your solution.
| 47:39.62 | Alok Sharma | Yeah, so we are again we are at the beginning of this you know Intech has been I would say really busy doing our own thing so we have you know we've got a partnership strategy. You know, certainly with I want I Want to say most of the if I call it the sort of price Providers. So Plaids. You know. Eyes Etc. We've got those strategies those partnerships in place we have implementation strategies in place with certain companies who are implementing our solution. Um, we are at the beginning of now as I said you know as we start to get into new Commodities. We are exploring partnership. Maybe even with with existing. You know, competitors right? That's the way that I would look at it. You know why? Not if you can if you're if if 1 is strong in a commodity and 1 wants to let's say harmonize across geographies and across Commodities. You know why not partner right.
| 48:33.36 | chrissass | Well didn't you already allude to that you said that in power you you already have a partnership I think I heard say So maybe you could a color you know paint a little bit more of the picture for us if you're willing to.
| 48:37.64 | Alok Sharma | Yeah, exactly.
| 48:42.97 | Alok Sharma | Yeah, so at this point it is at that stage where we are just formulating that. So if you you know, maybe if we do this again in the summer hopefully hopefully I can sit alongside a partner but there is some commercial confidentiality there chris if you don't mind.
| 48:51.38 | chrissass | Um, okay.
| 48:58.80 | chrissass | No, no, not at all. But what what I think I hear you saying is you're gonna partner for the expertise at least in the interim period of time. So so in order to to to extend into these other markets. You'll probably do it through partnership is what I'm hearing you say that's totally building something from the ground up.
| 49:04.82 | Alok Sharma | Correct.
| 49:10.83 | Alok Sharma | That is correct that is that is correct for the for the for the material change. We might do something interim. But if we have to call ourselves. Let's say an established power and gas system then it will be through partnerships right? we.
| 49:16.24 | chrissass | But.
| 49:30.39 | Alok Sharma | You know there is no point reinventing the wheel. Um.
| 49:30.77 | chrissass | So are you more of ah, an organic growth or an M and a kind of a growth company going forward.
| 49:36.95 | Alok Sharma | A bit of both Chris If I'm honest, you know and you know you can form partnerships without actual sort of you know M and a activity you can form exclusive partnerships. But you know 1 of those things that that I'm also you know I'm um, I'm sort of a golfer by you know i. Played golf and you know I always use the analogy in golf you you compete but you walk together you know So I think there is some room ah especially in a market that is fast consolidating as you know you as as you know as well as me, right? There is some benefit in um. In etrm providers looking at each other and saying guys rather than us throwing all this stuff at clients hoping something sticks. Why don't we partner up and offer something better right.
| 50:25.97 | chrissass | So but then is that why you focus so much on the data so is owning the data at the end of the day kind of where where the high value is for you is is you would partner with others but maybe control the data through that and bring value through the data and visualization of the data.
| 50:40.12 | Alok Sharma | Yeah, so the the core platform you know we we want to install. Let's say the core platform that runs the base processes and then you know depending on the client's need. We will partner out for you know for a particular commodity or a particular geography.
| 50:57.79 | chrissass | Then.
| 50:59.87 | Alok Sharma | That's kind of where we want to go what we don't want to do is to build a 1 ne-size fit all behemoth that is fit for purpose only maybe for 10 companies in the world right? That's not the smart way of doing things and that's not what our clients expect us to because. You compromise you know that's that's that's the thing what you know I've sort of noted even within the the liquid space that we've been you know I can sit with a crude oil trader a gasoline wholesaler at a marine fuel trader and they will all you know want to change the de capture screen right? because because half of the things are not. Not relevant for them. So how do you How do you? then? enrich user experience in this space right? because at the end of the day you know we we we are fundamentally ah sort of a design led company I mean a small insight into Inatech. You know we we hire. 30 percent of our people from liberal lots and seventy percent of our of our young people from from computer engineering because you know we need that Mix. We need to be design led because ultimately the users are interacting with this screen and so you need. Somebody from a completely non-engineering background to look at a screen and say why is it? Why is it. You know 25 buttons in there. What is the purpose of 25 buttons. You probably need 1 or 2 so you know those kind of discussions help us distill. Particular screens and the modules towards particular user experiences and that's how we want to go so the decision to partner was actually driven by the same thought. Let's not let's not try and you know ah go into a different field. Like creating something because there is already. We know that there are already systems there that are appreciated by the Market. So we're out. You know as we said, there's ah I want to say a healthy discussion going on and I'm hopeful that you know certainly in the new year we should be able to announce a few of those partnerships and then just offer a. Best of breathe type solution to our customers right? That's kind of what we want to do.
| 53:11.35 | chrissass | Okay, so so you're striving to be best to read? Um I hear the user interface is is where you want to differentiate. That's what you want to be. Has there been change with let's say the last 2 years with kind of the craziness going on in the world with Covid has there been demand change on the ux from from your customers because of this what's happening in the world these days.
| 53:32.40 | Alok Sharma | Oh absolutely. Absolutely I mean you know I'll give you a small example, right? What's happened during covid. Everyone's worked from home right? So you think about a training outfit where everyone is used to looking at four screens and you suddenly you're sitting at home. Maybe. Maybe you know if you're a trader you had your terminals shipped shipped at home. But if you were a if you're a sort of you know a junior analyst or or a risk operator or op or an operator. You know you're crammed into 1 screen or maybe 2 how do you? So we've had to you know. We had to scale down and reengineer our software in this process just so that folks don't end up with fatigue I mean I know it's a small thing but you know folks are looking at this system twelve hours a day at least so that's just 1 of 1 of the things that we've had to do the The second thing is Bandwidth. You know so you were an office setting right? where everyone had the the best of the Broadband and now folks are dispersed wherever wherever they were and they've had to operate the same processes with a lower um Bandwidth so that. Requires a level of reengineering that you know that I I alluded to earlier for us so to us you know the the whole work from home scenario. Although appliance because we cloud based moved you know literally overnight right? Um, thankfully so to a homeworking environment. But it caused us a lot of the support calls started changing from you know how do I do this to It's just I this I don't have my second screen right? and but what I used to do on the second screen now leads to somehow fit into 1 screen so that's um, you know that's kind of just the. Top of my head what we've seen changing um plus of course the markets and the volatility that we've seen I mean that is I would say that is not unusual increase now but not really unusual for any trading company right? We kind of cope with Volatility. They've done it in the past you know I don't think this time is sort of you know any is elongated but not really different.
| 55:47.70 | chrissass | Understood.
| 55:49.59 | Martin | Okay, but it's ah shift gears a bit and move to a bit of a different topic ah automation because at least in in power and gas. That's um, a core topic when it comes to short term tradinging but Also. Ah, long-term traders look more and more into let's say ago trading which is 1 form of automation for me. Maybe you canude a bit on on ah in a tech solution when it comes to automation Also ago trading I would strongly assume that. Shipping and bunkering and also oil market is not very much diving into automated trading. But I'm sure that automation in general workflow automation is also very crucial. There.
| 56:41.20 | Alok Sharma | You're absolutely right? Martin you know, um, the oil and commodity markets algo trading is at its you know at a very nascent stage. You know as we said by offering python to our users to keep be able to code their formulas. You know we think we're. You know at least at least the thought leader over there? Um, however, um, you know automation you know in our mind and but maybe it's kind of relevant for this this community you know automation. You know we can think of the of the of the front office. Which we're talking about now. We can also think about the middle and the back office and and so for us the more bank for the but for our customers it comes actually from the back office onwards right? If we think about settlements if we think about you know, ah invoicing if we think about end of day. I mean this is there's a huge amount of low hanging fruit that can be brought by automating I mean I have a we have a vision in our minds of an automated monthend process right? We've taken some ways towards it. But why does it have to be. You know one week cfo stops taking calls everyone hunkers down you know, sleeping bags under under the table and we will produce our month and results so um you know on the fourth of the month everyone comes up for air right? that so how do you automate that and how do you make sure that the. End of day is front and back office so that end of month is just another day right? That's the vision. So what is Inatech done so far so the Inatech back office the tech oil if I call it tech all is our solution. The tech call back office. Is actually any er rp that we integrated into a market er rp that we integrated into so this is Microsoft business Central right? It's 1 of the yeah erp it was the first 1 on the Cloud. That's why we chose it. We can integrate to anything but our solution comes pre-inte integrated. With this should the customers want to and to largely speaking for the middle segment. This works pretty well right? because that's what they want they want an integrated solution I think you gentlemen know probably better than me the integration topic and you know. The the whole we can have another webinar just on that right on on the on the dos and don's around it suffice to say that integration is a big topic and so we have preinte integrated a preintegrated solution that is capable of front to back office.
| 59:28.56 | Alok Sharma | Reconciliation on a daily basis right? And what we want to try and do is we we always whenever we deploy we sit down with our customers and we say if you want this automated we can automate it and then the month end becomes an automated and automated month end we are not yet there at the automated month then I'll be honest because you know the cfos traditionally you know they want to see they want to see and I don't blame them right and you don't want everything automatic black box. You know we are not sort of there yet. But that's the vision. You know and and that vision has been driven by my cfo who was you know in ah in a former life. He was the cfo of ah of a commodity trading company. So automation has a huge amount of benefit in the in the back office. When we come to the middle office again settlements right? It's probably something you know close to your heart. You know settlements. Why should there be teams of people sitting and punching things from 1 system to another ah regrettably it still happens. But there is a lot of low hangging fruit there and then. Once the market involves once the market evolves you know, um to the same to the same sort of liquidity as nx or as as as power, um, you know we look at algo trading. But I do want to make 1 small note I mean we hear. Ah, lot of it people being employed by large traders so because some of them you know some of them have gone from our organization. So I think there is some experimental stuff going on and probably it's safe to assume there's some experimental stuff going on amongst the commodity traders. To to see what algo training can can bring.
| 01:01:23.42 | Martin | So okay, great Thanks! Thanks for giving a great overview of your development roadmap in terms of automation that was very enlightening. Um. Ah, would like to refer to 1 topic that you mentioned along that elaboration. So you you talk quickly about integration I think that's a very important topic for for clients. So to um to know how they can integrate potentially resolution I have 2 questions that I'm um, very curious about so how does ah the integration looks like for your clients is it something where you help them like building. Also the architectural design behind it which is usually the first step. So which interfaces to build or to data flow etc and secondly from a technology point of view. What do you provide to ensure integration. Do you provide especially standard apis for that.
| 01:02:21.59 | Alok Sharma | Yeah, so the the second ah question I'll take first. So it's api driven right? Most of the integration these days is api driven push or pull depending on what the client you know wants to once wants to do um and yeah, so because we've.
| 01:02:26.18 | Martin | Um, okay.
| 01:02:40.79 | Alok Sharma | Preinte integratted our solution right? as I say for ah for a sort of middle size tier 2 trader we have integrated our solution. You know we come to the table with certain ah with ah with a with a schema right? because that's how we know now we have to adopt that schema for a. Sap or a you know and which which we've done by Sap jenny edwards or I call the usual sort of erp systems out there. Um, and so we adopt that schema for a client that wishes to integrate into a group solution. Um, what we try and. Advise our clients is let's do a the system to a client that is that has let's say an sap right? Let's just take an example find that is running a group er rp we would recommend a month and reconciliation into that system which would be their system of record. Right? So First we have to decide what is a so system of record if it is and a group e rp then we say you know try to maintain your the sanctity of our solution where you're doing all your processes within it but let's send you a monthend you know file. That reconciles into your chart of accounts and then you know you can run from it because broadly speaking the trading company is a separate entity that is trading under its own name. However, Reports is a part of a larger group. And the group is running an erp right? That's kind of what we've seen so far so that's an approach that we that we recommend because you know 1 of the 1 of the advantages of having a a sort of end toendd rp from a workflow point of view is exactly that right. Ah, what we started with which is data if we've got the data in 1 place we can produce the reports, the alerts the insights that are required if we then you know, integrate into another solution then that usually becomes a much larger project because you know you are then. Just increasing the complexity of of the project and you're going to take longer and probably achieve the same results. That's ah ah, sort of a you know we sort of we lead the discussion with that. But at the end of the day you know? Ah I can think of.
| 01:05:00.45 | chrissass | Got it.
| 01:05:13.31 | Alok Sharma | You know each case study where clients have chosen 1 route or another for various reasons that they might feel um but that's kind of how we like to approach this discussion.
| 01:05:25.68 | chrissass | Martin any final thoughts is. We're kind of getting up against time here and we need to get to the next 1
| 01:05:29.85 | Martin | No a member I'm fine that was I think you would elaboration on the topic integration. Thanks a look.
| 01:05:36.11 | chrissass | Um, like well I think we've covered a fair amount of ground here as I always say what I want to do is switch gears now and go into our speed round which is the ah 10 question round where Martin and I will rotate back and forth asking you questions. Um.
| 01:05:39.60 | Alok Sharma | That's it.
| 01:05:54.62 | chrissass | I will just start by asking the first questions there short answers. So answer how how you feel appropriate but we'll just kick in and see how it goes here so question number 1 is will the number of etr m vendors and solutions shrink or expand in the future. Why.
| 01:06:02.21 | Alok Sharma | Let's go.
| 01:06:08.12 | Alok Sharma | Um, expand like um I think it's just ah technology the barriers for entry in technology are quite low, right? That's just a ah market and I don't know if anyone remembers what we did in school porttas 5 forces. So the barriers for entry for technology are low. Um, the market structure is changing and that just is a field where people come up with new ideas. You know, not everybody does the same thing but there is a lot of inefficiencies in the market. That allow people to step in and offer a particular solution. So I think it's going to expand.
| 01:06:49.12 | chrissass | All right? Thank you martin.
| 01:06:52.80 | Martin | So okay, so a second question how many deals per minute must the modern etm or ctm system today. Be capable to import.
| 01:07:16.26 | Alok Sharma | I mean how long do you have for that answer right? if we talk about power. We're talking about five minute segments so you know that's I think that is I actually reject the premise of that question right? if I may politely because because it's ah it's.
| 01:07:30.74 | Martin | Yeah, okay.
| 01:07:35.81 | Alok Sharma | Just depends on um on the commodity and it depends on the client right? Suffice to say that an a modern, a modern architected solution should not have a capacity constraint. It's not as I said the expectation is I put in the deal.
| 01:07:38.30 | Martin | Right.
| 01:07:49.22 | Martin | So go.
| 01:07:55.10 | Alok Sharma | I see my bar straight away. So some of the so if 1 is a purely. So let's think about a derivative trader right? who is completely into energy derivovatives right for them even waiting for the for the ah. So I've put my trade into web ice and I'm now waiting for that trade to come into an integration into my etrm that time is too long might be a couple of minutes but that time lag of when I used a tt I used tt to enter it into ice. And now I'm waiting for that to come and reflect on my bar so to me that is a technology question and at the end of the day. The technology is quick enough to do to to cater to any amount of deals that and that that a client may well may wish to push through it.
| 01:08:49.75 | Martin | Okay, okay, thank you you.
| 01:08:50.68 | chrissass | Thank you all right? So next question are what commodity types and energy types are you offering and which ones would you consider your biggest strengths.
| 01:08:59.81 | Alok Sharma | So in a text strength is oil in gas liquid bio renewables. That's where we've grown up. That's our strength and we are as we've discussed we are we are also you know newly into oil into power and gas which is a segment of.
| 01:09:19.10 | chrissass | Great. Thank you.
| 01:09:19.18 | Alok Sharma | Huge interest for us for.
| 01:09:19.85 | Martin | So okay, do you offer a real time position Management Module and how real time is it. So I think you mentioned that really before once there's a new trade is that directly reflected in The. Position Management Module is it event driven from an architecture point of view. Okay, okay, thank you.
| 01:09:39.64 | Alok Sharma | Um, re real time. Yes event driven it needs to be real time. Yes.
| 01:09:45.29 | chrissass | Great. Do you have an automated workflow for straight through processing.
| 01:09:50.31 | Alok Sharma | Yes, I mean it's That's what is expected but I would you know I'm I'm newly into the etrm industry. You Knowtech is the only etrm organization that I work for. So I think that that is expected by the users. You know stp straight through process processing.
| 01:09:52.33 | Martin | Okay.
| 01:10:08.32 | Alok Sharma | Is just expected by the users these days. Yeah, however, along with along with excel upload of broker workloads that that not always come in right? So you cannot only offer an stp you know that's that's not what that's that's not what clients expect.
| 01:10:09.16 | chrissass | Okay.
| 01:10:09.85 | Martin | Um, if.
| 01:10:14.79 | chrissass | Um.
| 01:10:19.30 | Martin | It.
| 01:10:23.93 | chrissass | Thank you.
| 01:10:24.93 | Martin | Okay, great. So next question can your Etm Solution prize Asian options.
| 01:10:33.51 | Alok Sharma | So this is yes, there's a shot is the short answer but I want to qualify that by saying we're also currently in a project where we're building a proprietary valuation module right? so.
| 01:10:48.26 | Martin | I This is.
| 01:10:51.40 | Alok Sharma | The the technology and again you know this is this is through partnerships right? We we can embed. We are embedding a technology that allows our customers to you know to? you know to create their own valuation if you don't if you want to step away from the usual valuation models. So yes is the short answer and you know you are driven by the customer need you know I had a very interesting ten second digression I had a very interesting interesting discussion with a company that is a commodity company building its own etrm right? That's and and and and they david. They were they were defending that stance because they said nothing that we see that we want is in the market so you know and and and and it was actually a valuation model that they were building. They had an advanced risk department that was building their proprietary. Because they they took a lot of proprietary positions. So the point I'm trying to make is that you know if 1 is demand led if 1 is market led you know we never. We would never develop a functionality just because we thought it was a good idea. You know everything that's in our solution. Has been requested by a client at some point or the other. So if you start to turn this whole thing around and say be led by what your customers need. Um you usually come to the right answer right? And that's kind of where we are.
| 01:12:17.41 | chrissass | All right? all right cool. So next question are you offering a full integration and implementation service for your each tramp solution.
| 01:12:17.72 | Martin | Okay, thank you.
| 01:12:27.69 | Alok Sharma | Yes, yeah, so as as I've said it's a front mid and back office for it depends on the size of the company and you know commodity and so on and so forth, but in our sweet spot which is hydrocarbons oil bio renewables.
| 01:12:29.33 | Martin | Um, okay.
| 01:12:46.24 | Alok Sharma | It's a front mid and back solution integrated and implemented by Inatech.
| 01:12:48.27 | chrissass | Thank you.
| 01:12:49.26 | Martin | Okay, next question what is the biggest threat or challenge for third party Etm vendors
| 01:12:59.84 | Alok Sharma | Um, I Think the biggest challenge is really you know as I said stepping away from what what the user really wants I know it's ah it's ah it's a cliche term but ah what we tend to do is. Listen very closely to our users because ultimately we believe that you know once you've created a pool of users so you can't just focus on 1 But once you've created a pool of users. They have a they have skin in the game. You know. And so being led by them is probably the right way I think the mistake that sometimes companies make is by thinking that something should be something innovative you know should be ah you know should be developed and that the. The market is maybe you know, not advanced enough or not innovative enough to do that I think that's all of us have fallen into and historically in tech as Well. All of us have fallen into that trap. But that is the biggest mistake that you can make is shift your gaze away from what your. User Community is saying um if not for the if not for the full decision making at least for as a data point as you decide your roadmap.
| 01:14:23.13 | chrissass | Okay, so just we've got 2 questions left. This question is pretty straightforward. Um, what is your licensing model like today and you anticipate it will change in the future.
| 01:14:35.68 | Alok Sharma | Our licensing model is sas so we are annual subscription based and I don't think it'll change in the future.
| 01:14:44.20 | chrissass | Thank you.
| 01:14:46.45 | Martin | Okay, then last question are you offering an api or Apis and what is the technology behind it.
| 01:14:55.84 | Alok Sharma | So I have a little bit on thin ice being and being a nontechnologist. But yes, we are offering Apis can I say Microservices is that would that be appropriate answer. Ah or maybe not.
| 01:15:09.20 | Martin | Um, halfway halfway. But I think the important part is yeah sorist. Yeah.
| 01:15:12.16 | chrissass | Like Rep Fla guy or something like that might be more appropriate.
| 01:15:15.66 | Alok Sharma | I have heard I've been on those calls I apologize I can't give you the technology. But.
| 01:15:20.00 | chrissass | And no worries.
| 01:15:20.94 | Martin | No Wories I Think the important part is that our api is what the theology at the end is is more a minor V detail. Okay, thank you.
| 01:15:26.44 | Alok Sharma | Um, and have been that the there must be no yeah, thank you.
| 01:15:29.40 | chrissass | All right? So so we've gotten through our questions we've gone through pretty much the show is like I'd like to give you just a short minute or 2 to kind of sum up why someone in our audience today who's. Interested in each your m or maybe each your arm special would want to reach out to int tech and maybe bring your thoughts together if you keep kind of a concise thought of that. All.
| 01:15:49.28 | Alok Sharma | Sure. Well thank you chris and Martin I think it was a healthy discussion. Um, you know why in a tech I'd probably give just 3 reasons. Um I'd probably say the reason number 1 is that you know we are looking at. Not a 1 ne-size fit all model right? as I've as I've explained before Inatech has a system that has a configurable work workflow and front to back you know deal flow within it so we do trading ops inventory risk accounting tax and finance. So what that allows a company to do is adopt the best practices for that commodity and that's 1 of the reasons why the customers choose us I think the second reason that customers choose us is what I say Rapid implementation you know our model is not to customize. Our model is to configure. This is why our implementations run into weeks right? A few weeks is is what our implementation cycle is certainly not the months and sometimes regrettably ears that is is the norm in this in this environment and and the third thing that I would that I would say. You know is is Reallyi key is the overall return on investment right? We understand that and that systems change decisions are now board level decisions I t and systems are are very important so we work on a return on investment model. That can be presented to a board for approval and we have you know having implemented this you know dozens of times we have collected for ourselves that data that allows us to present ah roi to our users and the decision makers and so. I'd probably ended there I would think that those are the 3 reasons. Why? um inter text should certainly be given a look.
| 01:17:48.38 | chrissass | Well thank you so much for joining us on the show today I appreciate your time. Thank you for again for joining for our audience. Ah this concludes this episode of insiders' guide to energy each year on miniseries.
| 01:17:55.96 | Alok Sharma | Thank you, Thank you very much.
| 01:18:05.88 | chrissass | As you may be aware of by this point that there are 13 episodes out there. We encourage you to listen to all compare and contrast use the chapters function to jump around to listen to the parts you want to hear and we look forward to hearing you speaking to you again from another podcast. Thank you so much for your time bye bye.