Digital Transformation in (and for!) Procurement

Howard Walper, CEO, Americas at Commodities People

Good morning, everybody. Welcome to this installment of our commodity procurement forum where we're going to be focusing on digital transformation in and for procurement. I'm Howard Walper. I'm CEO for the Americas for Commodities. People, we've got a great panel lined up today for you. But before we get started, a few quick things. First of all, if you find this sort of information important to your business, please consider attending one of our in person commodity trading week events in the UK, in the USA and in Singapore. Our London event will be taking place April 23 and fourth in London. Our US event June 5 and 6th in Stanford, and our APAC event will be held in Singapore this January 24 and 25th. They're all fantastic events, really encourage you to join us. And if you work for a qualified commodity trading company, whether you're in trading risk, digitalization, sustainability, back office, whatever your role, you can apply for one of our free VIP passes. And of course, other types of folks can attend for a small fee. Now, we're going to be taking questions today during the webinar. We want as many of you involved as possible. So if you do want to be part of the conversation, please use the Q a button at the bottom of your screen, not the chat button, the Q a button. We'll try to answer questions throughout. And at the end, as they make sense, we're going to try to get to as many questions as possible. And finally, special thanks to our sponsors, who you can see behind me on the screen. Without these folks, we really wouldn't be able to have events like this. So thank you very much for making this possible. And so with that, without further ado, why don't we go around the table and let our panelists introduce themselves? So, Scott, why don't we start with you?

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Thanks, Howard. Pleasure to be here. My name is Scott.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Welcome.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

I'm the risk director for grains at the Good Mills Group. We're Europe's largest wheat miller, operating in seven european countries, processing around 3 million tons of grain per.

Howard Walper, CEO, Americas at Commodities People

Welcome, Scott. George.

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

Hi, I'm George. I'm the head of price risk and hedging for Island Oil. We're a physical supplier of marine fuel, and I deal with all sorts of aspects of market risk. So from execution to hedging strategies and then exposure control, CTRM implications, and so wonderful, wonderful.

Howard Walper, CEO, Americas at Commodities People

Panos, why don't you introduce yourself?

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

Thank you, Howard. So, Panos. Papa Constantino. I'm the new chief digital officer for Arrow Resources. We're a commodities trading group based here in Switzerland, operating across ten countries and pretty much looking into the overall digital transformation of the company as a whole.

Howard Walper, CEO, Americas at Commodities People

Right.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

So it's a pleasure to be here.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Thank you.

Howard Walper, CEO, Americas at Commodities People

Wonderful. Well, welcome. And last but not least, Dr. Sadar Abdul Rashid. Doctor. Yeah, hi, how are you, sir?

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Thank you very much. Thank you. Welcome panelists and myself, Dr. Sadar Abdul Rashid. I've been working in the Middle East basically for two decades in commodity risk management and price management and hedging. So currently I'm with Sabola Group as the director of commodity risk Control in hedging derivatives. All these things. Back to you, Hawai.

Howard Walper, CEO, Americas at Commodities People

Wonderful, wonderful. Well, welcome, gentlemen. This is a great panel. We got some folks here, some new folks I haven't met before this event, and some folks who have been doing quite a few things with us over the years. So I'm really looking forward to this discussion. So let's start with the question. When we're talking about any sort of digitalization, it comes down to starting with data. How are greater access to data and advancements in technology changing the way businesses make decisions? And what are some of the advantages and disadvantages to the catchphrase today? Data led decision making. Where do we stand on that front? Who'd like to give a start to that? Somebody.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Yes, I'll start there. You can hear me, right? Fine.

Howard Walper, CEO, Americas at Commodities People

Yes, sure can.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

Sure can.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

So data nowadays it's become very inevitable. And wherever you interact or talk, it is data, because we are capturing our footprint in electronic space and espace and cyberspace. So by getting the data, we can make wonders as well as blunders. Wonders and blunders. We have a common saying that garbage in, garbage out. So clean data is very important for proper decision making. We are encountering everything in data, starting from our mobile phone to whatever you search in cyberspace, the data is taking a big lead in decision making. So the important thing is you have plenty of data. But taking decisions based on cleaning the data, the process of the data to cleaning the cleaning, transforming into the cleaning process and using the better tool to make decision making, that is the key challenge nowadays. So we can say that it is a data driven economy before we call it information. Information is money. In the trading space, we always say that nowadays data is also money, but wisely, you have to use it. You can make wonders and blunders. That's what I want to say.

Howard Walper, CEO, Americas at Commodities People

We had a comment when we were doing our preparation for this about the challenges of access, harmonization and exposure. What do those elements really mean in the context of this discussion?

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

Perhaps I might add to this. Right. And I think Dr. Sadhar actually mentioned it quite nicely. Right. So collecting the data is actually the first step, and that's not even the big step, to be honest. Right. So you have to make sure that the data is harmonized in a way that it can be aggregated, it's accessible from where it needs to be driven before you can even expose it in a meaningful way so the actual users can start making business decisions out of it. I think it really is a new practice, it's a new way of working. And I think that really collecting and thinking about terms like data lakes, pulling different sources of innovation, and we're dealing, I mean, in a trading company, in any company, you're actually dealing with a whole bunch of data. There's so much value into this, especially if you're starting to look into the minor trends beyond the things that you would usually already know by yourself. Right. And the one thing that also I think is important is the fact that these business data driven decisions do not necessarily change what our traders are doing. They augment their work by perhaps looking and picking up on signs that usually they would rather know by themselves or kind of usually oversee as they're going for this. So I think they need to be coupled with an experienced individual that actually can make the best out of the full package.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Howard, if I can just pick up on the two points by panels and they highlighted some of the advantages, which I certainly agree with, but just to sort of play contrarians, some of the disadvantages I think we're finding is there's a lack of wanting to disagree with the numbers because we assume the technology cannot be wrong. Whereas if it was a human being giving you data, you would probably challenge them a bit more wholeheartedly. I think that's possibly where some of the disadvantages come along, is the inability or unlikelihood that you will challenge the data that you get when you're making your trading decisions.

Howard Walper, CEO, Americas at Commodities People

I guess that does lead to the question. So when you're relying on data and data led decision making, is there a human check that needs to be put into place, and what does that look like? Any thoughts on that?

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

Yeah, you always need to have a human check. And I agree with Panos, it's more a way of saying it as augmenting our capabilities. You can use data to automate processes, take out what they say, the boring stuff, and have more time to make quality decisions. This is what we want to do. But at this stage, with the technology we have, I won't rely 100% on data. Then another aspect I would like to say regarding the decision making. I think as humans we can be biased and using data can help us to make more objective decisions. As very often we say it's better to judge a person on their facts and their actions rather than their sayings. But at the same time, we have to be careful because data itself can be biased as well, which is sometimes what we say about language models at the moment where they are hallucinating. So I think it's a very good tool. It can help us. But yeah, we need the person that's in charge knowing how the whole system works, what assumptions have been made and steps have been taken to automate either a process or to build a model. And yeah, I can very often see the difference, for instance, between someone that has built an etRm, when there is a mistake, he will know what happened and correct the problem, and someone that has just learned how to 

press the buttons and then won't tell if there is a problem.

Howard Walper, CEO, Americas at Commodities People

Sort of leads to this next question about data, in terms of.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Better access.

Howard Walper, CEO, Americas at Commodities People

To data, allowing us to view things like market trends, or maybe be a little bit more precise in terms of, say, modeling risk or something like that. What has better data allowed your groups to do better? In terms of viewing things like market trends or risk measurements, things like that.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

See, data is a first hand tool to get the feedback, especially the immediate feedback we can drive from the data. The second one is that we can use a lot of predictive analytical tools to predict the future and capture the trend. What's going on in the industry? Suppose you can see that in our very lives. The x is a platform, before it was a tutor. And if you see the chat happening and the most trending thing the people are talking in the town can be immediately captured with the support of the data and predictive things. It's feedback, immediately what people are talking about, and what the current topic is. So the data is very important in getting immediate feedback that we can say. And the trend, there is no other tool to capture it, especially if the things are happening to a cyberspace, if you can track it very easily. The next one is understanding consumer behavior, especially in every kind of market. The data is very important in understanding the proper consumer behaviors and marketing strategies, basically based on what the companies are doing. Even if you know that very well, if you search something on Amazon by chance that Amazon will think the same, similar things will follow you whenever you open any explorer or any browsing. So the data is the primary firsthand information. You can check it for getting any level of trend setting, strategy setting and consumer behaviors and feedback checking. So these are the primaries where we can clear out the data. And sincerely I agree that you need human intervention. Between that you cannot completely rely on the data on certain aspects. You need to have a human interface properly. Then we can make big things and make decisions.

Howard Walper, CEO, Americas at Commodities People

Let's start getting into the actual parts of the supply chain. Where different types of digitalization are being proposed as solutions to increase speed and efficiency throughout the whole supply chain. One of the areas that I think we chose to start with was the area of trade finance. And this isn't specific to trade finance, but bills landing is a big area that a lot of people are focusing on trying to digitalize. There seems to be a lot of promise in that area, but quite a few challenges. What are you all seeing in this space?

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Can I take it?

Howard Walper, CEO, Americas at Commodities People

Sure, give it a start.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Yeah. The biggest thing is that the bill of lading is a very good idea. The problem I will start with the challenges, you know, the advantages, but the challenges is the intercompatibility and standardization. Because international trade is happening between countries. The regulations are wide and diverse. So we need to bring an intercompatibility. And we need to have a standardized platform that can be adjustable anywhere. If you see one of the things is the commercial underlying commercial instrument. It is considered as a commercial negotiable instrument, as a value. So if you are concerned with the banks or the banking relationship and banking dealings, different central banks have different regulations. So we need to bring under a legal recognition and regulation and standardization and intercompatibility. That is the biggest challenge in the bill of lading. And it is a kind of a trust and collaboration kind of a thing we need to bring between the countries across. And that is a very diverse thing to bring it in overnight kind of a scenario. That's why most of the areas like intervention come to that. The blockchain and the new interventions and new technological advancements in the blockchain technologies. It's little far behind in this area because of this intercompatibility and standardization and regulatory support from globalized countries. And globalized, that's the one concern.

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

Another area of difficulty I see for the electronic BL is there is some fear that sometimes it might be easier to have fraud. And sometimes people are not sure of the legal value an electronic BL can have. But I think it's important to get past that and to focus on all the advantages that we can have if we're able to streamline the whole process and have better cash flows on the financing side and from the market risk side, the possibility to have smart contracts reduce our errors and have the whole process streamlined.

Howard Walper, CEO, Americas at Commodities People

That makes a lot of sense. Well, anyone want to add anything else on bills of lading before we move on to the next question?

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

No, I think the only thing to add on that is some of the certification is still not fully available. I think phytosanitary certification, certainly some of our quality certification is not standardized across even Europe. So that makes e bills of lading very difficult to work with, and we still need to do some work as an industry on that.

Howard Walper, CEO, Americas at Commodities People

Well, so you mentioned there was quite a bit of mention of standardization in this conversation. And I know say the folks at BIMCO are also working on this as a project. Where should these standards come from?

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Interesting question, because every major area has its own sort of governing agriculture board. I mean, even within Europe, we probably have 27 individual ones, even though we have the Ag commission. So I think in all honesty, it's for the trade to get together at conferences and summits like this to really come up with a standard, one that sort of fits for all. I think we are probably waiting forever if we wait for some government or governing body to find a suitable standard.

Howard Walper, CEO, Americas at Commodities People

Right. Makes no sense. But one of the things when researching a bit on trade finance, I remember one of the discussions we've had was the difficulty, maybe small and mid sized trading companies had finding finance versus some of the larger companies. Is there an opportunity in this to sort of match lenders and traders up digitally versus sort of the manual process?

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

I can give it a start. Right. Yeah. So this is also related a bit to the previous question, I guess, right? Yeah. The benefit is definitely there while we're waiting for someone to actually come in and tell us how it should be done, I think we should be getting together and starting to kind of put these frameworks in place and starting to ask our ecosystem of partners that we're working with to kind of bite by them by these rules.

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

Right.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

So by these standards, and slowly, hopefully, we can get some headway before we can actually have somewhat of a standard, if you will, across the industry.

Howard Walper, CEO, Americas at Commodities People

Right.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

So you can't get there from one way to the other by just waiting for someone to come in and regulate the space. Right. So if you don't do it for yourself, someone else will. Now, the benefits in doing so are like multiple, right? So first, kind of cohesiveness of data automatically reconciling and making sure that you have updated statuses on open topics across the board. And also, if more of us are actually creating this and abiding by this framework, if I might say, then you're starting from George's earlier point, reduce the fraud risk to an extent. Right. So perhaps you get more credibility and value by using it and getting more players on board, rather than just kind of waiting for this to kind of pop up by itself. Right. So I think we should kind of get in the driving seat of driving things in this matter.

Howard Walper, CEO, Americas at Commodities People

Excellent. Well, let's move on to the area of supplier relationship management. And again, please let me remind everyone in the audience, we'd love for you to be part of this conversation. If you do have any questions you want to throw in here, please use the chat box at the bottom of your screen. Or not the chat, the q a box at the bottom of your screen. We'll get to as many of your questions as possible. So folks, what are you seeing in the area of supplier relationship managers management? In what ways is technology helping and what areas are you finding it may be ineffective or even a hindrance? We would like to take that as a start.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

See, the first of all, the supply chain integration, that is one of the biggest area we can start up with because the supply chain integration with the ERP system, because most of the companies have their own enterprise resource planning systems, either in Oracle or SAP or whatever the platform they use, this is the one area they can integrate it into, supplier SRM thing. And the next one is the eprocurement. Because nowadays it's. The eprocurement is very famous and that will give you fair procurement decisions because some of them will do each entering process because it will be fair play. We have to give the opportunity to each and every person who is bidding over there, and they need to make sure that the process is very transparent. So eprocurement is one of the areas, the biggest companies do that and there will be a fair play and we can make sure that it has happened in a fair environment digitally, so there is no fraud. And the meantime is the concern we put up in the beginning is the cyber threat and security. So we need to make sure that we have closed all the doors for the outsiders to come into our cyberspace and things will be transparent and clear. So these are some of the areas they're already in the industry, and they are exploring more into other areas.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Just adding on from our side. I agree. It's been very helpful in getting clean and standard data. I think the only thing to bear in mind is the questions asked, because it's just probably an online survey, so you can only really ask the question in one way, whereas if you're face to face, maybe get a different viewpoint on it. And I think the other thing is the integrity of some of the answers. You know yourself, if you have an online questionnaire and it says, how many alcoholic drinks do you have a week? And you probably say, I have three or four. But if you're sitting in front of your doctor and he looks at you and you say, I have three or four, and you're like, okay, really don't have six or seven. I think judging the accuracy and integrity of some of the data in these digital supplier relationship management tools is something that, again, probably comes back to needing the human element in it to vet it. Because at the end of the day, the most unpredictable things we deal with are human beings. Not the markets, but human beings.

Howard Walper, CEO, Americas at Commodities People

Yeah, and I think we're actually going to get into that a little bit down the line in our conversation. In preparation for this call, we did keep coming back to sort of the human element and where that needs to run, sort of in parallel with technological solutions. So a question popped up about blockchain, which is interesting because that's sort of the next question we have here. And we're also going to run a poll on this. So before we start, before you guys answer. So the question I'm going to be posing to the panel is for both supplier relationship management and trade finance digitalization, blockchain seems to be sort of the go to tech. It makes sense. But what have the challenges been with this technology? And in general, do you think blockchain has lived up to its promise? Now, before you answer that, I want to throw this poll up. Hold on one moment.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

I think, again, the problem is the scalability. The scalability is the biggest concern nowadays, bringing the blockchain kind of innovation. And second is the integration with the existing system. Because if you bring any kind of a new innovation and you need to integrate with your current infrastructure, and that will come out with the cost, then the cost and ROI, and it make me this many costs, then I need to think about the return of investment that either in way of service or any other things. And we can say that interoperability is the one concern. And scalability overall, we can say the scalability and the cost concern that is the one hindrance everywhere to bring the blockchain into any kind of environment.

Howard Walper, CEO, Americas at Commodities People

While everyone's answering the poll question, does anyone else have anything to add about blockchain on my side, we haven't really.

SPEAKER

Seen any benefit of it in Europe. Maybe because we're in Europe and not across continents. But if you ask me, just gut feeling. I would say maybe it hasn't quite lived up to its potential expectations because two or three years ago all we heard was blockchain. Now maybe AI has taken over and those involved in the blockchain market are sick of the name of AI. But my gut feeling would say it's probably not quite lived up to its expectations or potential at this moment in time.

Howard Walper, CEO, Americas at Commodities People

Go ahead.

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

I'm sorry if I can add to this. Very often when you have a new technology, in the beginning you'll have a pick, everyone will be talking about it, then it will calm down. But that doesn't mean the technology has disappeared. To me, it has some features that are very key, like the decentralization and the trustworthiness it can have in enhancing the transparency in the process and being able to add blocks that are not being deleted. I think it's a key feature that I think the technology has not yet been understood. But it's behind a lot of cryptocurrencies, for instance, which everyone is slightly different trying to find a different application. And I think given some time, I think we'll see this technology being adopted and applied in various areas.

Howard Walper, CEO, Americas at Commodities People

Let's see what the audience had to say about it. Doesn't look like we have a lot of blockchain fans out there. Let's see. We had 5% say that it has lived up to its promise. And then we were kind of evenly split between no and undecided. Significantly, if you remember, maybe, what, six years ago when blockchain was sort of the buzzword. It doesn't seem to have maybe impressed the public as much as maybe we thought it would.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Howard, to that I think I agree with George's comment. I think some of it is the lack of understanding of exactly what it can and cannot do. And I think that's probably where we need to work on, because a bit like bitcoin, it doesn't make a lot of sense to me, so I haven't touched it. And probably there's a lot of people out there thinking, okay, I understand kind of the basis of blockchain, but really, how does it help my business or how does it help me? And I think we need to spend a bit more time on re educating and highlighting the benefits of it. Because I agree with George that there are advantages to it and we just have to repromote those.

Howard Walper, CEO, Americas at Commodities People

Actually, you know, we just had a question. Come know, how is technology helping improve sustainability in the commodity supply chain? It's coming in right on this question on blockchain. I always thought that blockchain would be kind of an ideal technology for tracking, say, carbon across a supply chain where different companies are looking at their scope, one scope, two scope, three types of emissions. And I know of at least one company who has a sort of blockchain supply chain solution where all their vendors contribute metrics as to carbon footprint throughout their whole supply chain so they can have an added glance thing. Maybe that's one way that technology is helping improve sustainability. But are there other ways where you guys are looking at different sustainability metrics and trying to use technology to track it throughout your systems?

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

A difficult one. The sort of question, how does technology help improve sustainability? To me, improving sustainability is reducing fertilizer, all this sort of stuff. I guess technology really only is helping to record the data accurately with more integrity. I struggle to really see how it benefits to improve the sustainability in the supply chain. It's more for just sort of marking it down and showing you the results of your actions.

Howard Walper, CEO, Americas at Commodities People

Yeah, it makes sense. Just quantifying it a bit. Yeah, absolutely. Let's move on. As we're moving out of maybe proof of concept systems into rolling out full systems, how are you all assessing your return on your investment in this technology? Or even before you start, when you're considering a new investment, how are you looking at what you expect in terms of return on investment?

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

See, we can't directly take out the monetary benefit as other businesses do, but it will bring you a new leverage on interacting with the customer space and your internal process. Become a person dependent to process dependence. Okay. It's very important for the companies, like if you see it ten years back and now the kind of automation, you bring it into your system and we have different tools from Microsoft or anyone else in day to day life, the emails and all these things. So it is a process of efficient management inside the organization, rather than taking a proper ROI in terms of numbers, because it will give the people more satisfaction. And every company, the existing existence is lying on process dependency to be more on the process dependency rather than the person dependent kind of a thing that we can bring by automation. And we are living in a very advanced world of robotics and artificial intelligence and machine learning. So it is important that we need to be behind. We need to go with technological innovations. So there it is, up to the management decision. It's not an ROI. Of course it's an ROI. It's up to the management vision. Are we in that space or are we in this space? I'm okay with Excel or I need to bring it into the next level of technology. The same question will come in CTRM ETRM space as well. So are YOU able to manage everything in Excel or do I need to bring a system that can automate all the process, bring my numbers very quickly. So it's up to the organization level rather than an arrow. I think cost is always, you can't ignore that. But it's a vision up to the organization, to organize how they want to be.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

And perhaps building on this, which I like very much. Right. So you almost have to start from the company wide strategic planning process. And I think you mentioned it.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Right.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

So it's starting from that point, quantifying where you want to see your company moving into and then being able to tie back specific digital transformation technology efforts and so forth into tangible impact. Usually you start by automating mid back office topics. So perhaps realizing some cost reductions, reducing some overhead when reconciling our kind of moving into, as Saddar said.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Right.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

So into a more process oriented mindset. Yet the true value comes from you moving from the mid back office into the front office and being able to kind of start making the difference in terms of where the company is headed. So I think ROI is almost a holy grail in everything technology that we do, right. So yet there is a monetary benefit, sometimes easily quantifiable, yet it needs to have a tangible impact into where the company is headed. Right. So otherwise you kind of risk starting to look for opportunities which might be seen as nice to have in terms of where the 

companies are. Right. So that's where at least I would suggest that one needs to start.

Howard Walper, CEO, Americas at Commodities People

Any other comments on that? Well, let's move on. Throughout this conversation, we've touched on the human element. Digitalizing supply chains really involves participation from all sorts of parties within a company, with vendors, things like that. So let's talk a bit about change management. How willing are you finding people both internally and externally to take advantage of new platforms and opportunities for automation or digitalization? Scott, why don't you start with that one?

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

Sure.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Yeah. We've found different, I guess different demographics, different countries. We launched, a couple of years back, a green purchasing application because we realized that we could get around to a lot more of our customers a lot quicker using a digital app. And a lot of our customers, who are farmers, are out in the fields, working, but they always have their mobile phone with them. So we thought this was a perfect way to link with them, not just showing offers, but information and everything else. And it works very well to a certain extent until it comes to actually confirming the business. And we found a large proportion of our customers prefer to confirm the trade via a phone call rather than on the application. And that's really been a struggle to change that mindset. I don't know whether it's a fear of security or they're so used to speaking to the guy and saying, yeah, that trade is booked, or that's confirmed. In general, it's been a very good success and it's well liked, but there still is that little bit of not fully committing to the whole digital supply chain. And I say maybe because they're generally a little bit older and that's a fear factor, but it's been an interesting journey and certainly been successful, but, yeah, been a good experience and we hope it continues.

Howard Walper, CEO, Americas at Commodities People
Does anyone else like to comment on that?

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

From a more general perspective, I think embracing technology is the way forward. It's also from, you have to be competitive. So if your competitors are doing it and you're not doing it, then at some point from one side your costs will be higher, and from the other the quality of the services you provide will be lower. So when Scott mentioned an app, I think it's something that a lot of companies are now providing as a service. Whether it's an app or a platform, they give you a way to interact that's facilitating the whole process from one side and from the other is also providing data, which is a service. It might not always be tangible, but it's sometimes where you actually make the difference. In a word, that's very competitive.

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Absolutely. So we're getting towards the end. We got about seven minutes left. Again, if anyone has any questions, please feel free to send them into our q and a box. But what I'm going to ask is for you all to look into the future a little bit, get out the crystal balls. And what sort of visibility into the supply chain will we need looking into the future? Perhaps that could be assisted by a technological solution. Where do you see our future challenges, and where do you see sort of technology developing to keep pace with those challenges? Sarah, you want to start with that one?

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Yes, of course. Now we are in, as we all discussed, we are talking about technological innovations and everything is now connected to IoT, Internet of things, right? We can't live without the Internet. And it's like air nowadays. So everything is captured through cyberspace, through the Internet. So there are many ways for optimization. So we need to do optimization in our supply chain. That's very, very important. As George mentioned, the competitors always look for opportunities for optimization. So optimization will come with a cost, but in the beginning, but in the long run, it will be satisfactory with a better optimization that will make you harvest later, you will get advantage later because you are doing a capex investment in your organization. So I know there are a lot of holes in the current supply chain, and we don't have any perfect supply chain anywhere. If you see talk about Toyota and japanese technology, everybody will talk before coming to ERP or machine learning or AI. And this is most case studies in all the business schools. Toyota has their own optimization of supply chains. And I heard something like Toyota already has planned what will happen in the next five years, even the model with specifications, because they have the planning and supply chain automation and optimization is that much. So the industry is changing and competition is increasing and the needs in the global needs are increasing. Population is growing at a very drastic level, and we have only one way to stay with the people. So everywhere we need optimization, and in terms of the commodity industry or in market driven economies need optimization, there is technology that can leverage a lot of optimization because it's all passing through the Internet. So cyberspace is a very big ocean. So it's up to, again, the decision of the company, the organization, and which level they need to scale up the things. Are we okay with that? Or I need to scale up myself on these intangible, intangible things? That's what I can see and say.

Howard Walper, CEO, Americas at Commodities People

Wonderful. Would anyone else like to put a comment in there?

Georges Panaghoulis, Head of Price Risk and Hedging at Island Oil

Yes, if I can add on technology. Actually, two main things we need from technology in the supply chain is real time information to know at every time where we are and where we sit. The second one is transparency. And if I can add a third one, it's resilience. We had a lot of disruptions. We had the pandemic, we had the war after. Now we have the Red Sea channel that's closed. So having access to all this information can be of help. And then it's also to take it one step forward. To be able to switch the supply chain, whether it's to go to different locations or to be able to switch the product slightly and to be able to adapt.

Howard Walper, CEO, Americas at Commodities People

Thank you.

Panos Papakonstantinou, Chief Digital Officer at ArrowResources AG

Perhaps a build from my side, right? So I fully agree with the aforementioned points. AI and data and technology offer a lot, right? Yet we also need to be able to steer this technology because we need to know what we're actually looking for. So I think for us, beyond adopting the technology, building the skill to actually ask the meaningful questions would actually help guide the technology output into an outcome that would be beneficial for us more directly. Otherwise, it might feel that we're just digitizing and automating for all the good reasons, yet we're kind of looking in the dark for where the real value is, right? So I think that we need first to train ourselves to ask more meaningful business questions that could translate into building these technology components with a direct impact and ROI as we move forward.

Howard Walper, CEO, Americas at Commodities People

Wonderful. And Scott, you want to have the last word on that?

Scott Wellcome, Director, Grains Risk Management at Goodmills Group

Not too much to add. I guess I just come back again, maybe from a bit more of a contrarian side, is that I think that not having sort of a standardized technology or one size fits all allows some arbitrage and some opportunities out there for companies. So I'm kind of glad that we look for technology and AI to help us become more efficient and optimize our businesses. But at the same time, if we all had the same technology and data, it would be a very dull world out there. So I think a happy medium is where we are at the moment, but it bodes well for the future. I guess at the end of the day, the main thing.

Howard Walper, CEO, Americas at Commodities People

Excellent. We had a question come in about AI, but I think we've touched on that in a lot of your answers. With that, we are just about out of time. So I want to thank our wonderful panelists for joining us today. Thank you so much for sharing your thoughts and your insights into this topic. A special thank to our sponsors, sequant capture and core, for making it possible to host programming like this. And of course, thank you to our attendees who are joining us from points across the globe to keep on top of some of the latest trends in commodities procurement here. And of course, one more mention. If you like this sort of information or other information about anything having to do with commodity trading, please do join us at one of our commodity trading week events around the world once again, our London event will be April 23 and 24th. Our US event will be in Stanford, Connecticut on June 5 and 6th. And of course next year in Singapore. We will be on January 24 and 25th. And if you'd like more information, please visit commoditytradingweek.com. That's commoditytradingweek.com. Well, thank you everybody, and wishing you the best morning, afternoon or evening, depending where you are in the world. We hope to see you all again very soon. Thank you very much.

Dr. Sadar Abdul Rasheed, Director of Commodity Risk Control at Savola Group

Thank you. Hoa. Thank you so much. Thank you so much. Bye.