The modern treasurer lives in a connected world, having to deal with real-time market information, make immediate decisions, and manage a large number of banks, subsidiaries and providers. Yet, many treasury platforms may still lack the ability to provide collaborative instantaneous work due to limited features, or to secure and centralise all financial data and flows, because of outdated technologies and slow evolution.
Should you wish to move to the next level of treasury management, when selecting a new treasury management systems (TMS), one can consider the following:
It is an excellent opportunity for a treasury department review: Commencing a TMS project allows the firm to reassess current processes and procedures within the department of treasury and to also evaluate existing systems and their use. As a result, it might be possible that the new project is not about a completely new system, but more of an efficient integration with the existing systems in a single environment for strategic treasury.
Prepare a requirements listing: This should be a thoroughly researched documentation about the departmental treasury technological requirements which may as well include additional system’s requirements. It is important to involve all relevant parties and ensure that all key personnel (stakeholders, etc.) sign off on the final document.
Secure management and budget commitment: To quickly make this a reality, ensure that there is a solid management understanding of its importance and; include any additional elements needed and agree on the budget available. Obviously, this will be an estimated cost based on initial research, but as the selection process moves forward and discussions are held with vendors more accurate costings will be drawn. This also requires regular updates of the management if there is any change on the scope or the budget of the project to gain their support on time.
Carefully manage the selection project: Research the market thoroughly to ensure that all of the suitable options are considered, since otherwise opportunities may be lost. Plan the selection process cautiously and compare all potential systems against a common benchmark, which usually is the key points of the requirements’ documentation. Divide those requirements between “must have” and “nice to have”, so as to be able to compare vendors and costings at the same level. Evaluate the findings (including cost of additional services, locality or cost of any future requirements) and create your short list. Before reaching any final decision, make sure that all important aspects of this project have been addressed and clarified with alternatives and assurances so as to be able to propose what is suitable in this respect.
Thoroughly plan and execute the implementation project: Confirm that management is backing the implementation project and put a robust project team structure in place that involves an experienced project manager, stakeholders and representatives from the most important finance/business areas. Work with the vendor as a team to quickly and effectively address any concerns or issues and also to set up a sound governance structure to guarantee that the project runs in line with the predefined requirements following best practices. Furthermore, and above all, build at the outset a comprehensive and detailed project plan, breaking the project down into its various components, clearly assigning specific responsibilities to individuals with realistic deadlines.
A next generation of treasury management systems (TMS) can free treasurers’ time up from tedious tasks, while providing unique tools that fulfil their needs, like:
- Real-time management and a 360° view
- Full security and data confidentiality
- Straight Through Processing (STP) with intermediate checking points
- Functional richness
- Extended customisation and configuration (workflows, task automation, scheduling)
- Easy administration and maintenance (lower TCO)
To conclude, the decision of whether to invest in a new TMS or not is the outcome of many parameters, but the top two that must be evaluated are cost and integration. Imagine the cost that a missed payment- such as an interest payment on a loan – would bear to the firm which could have been avoided with a more efficient system in place. This could be enough to cover the cost of the TMS. The investment may save a lot of time, cost and resources in the long run i.e. in three to five years’ time, when most systems will be automated and instant reporting will be a must. As a result, investing in the right TMS system is undoubtedly the wise decision to make when expansion and efficiency across operations are what is needed!