Corporate TreasuryTreasury transformation part three: implementation and beyond

Treasury transformation part three: implementation and beyond

This is the third of a three-article series on treasury transformation. By Simon Kaufmann, leads sales and marketing, Fides

As the complexity of treasury operations continues to increase, organisations need to change in order to keep pace. Treasury transformation requires embracing change, moving faster, and responding faster to deliver better experiences for your customers. It means continuously striving towards greater efficiency.

Any transformation initiative can be broken into three distinct phases:

  • Phase I — documentation, benchmarking, and assessment
  • Phase II — building strategic and implementation plans
  • Phase III — implementation, rollout, and management

This article covers the third phase of treasury transformation. At this point, you’ve completed the first two phases and you’re ready to start implementing your strategic plan.

I’ve further broken Phase III down into three stages: implementation, rollout, and management.

Implementation

Your plan should contain multiple phases for implementation, with defined milestones to clearly reflect progress. Ideally, you will have a project or program manager to shepherd everyone through the process and hold regular meetings to ensure all deliverables are on track and on time (as much as they can be for any large-scope project). This type of plan will also help you keep on track and also easily report progress and results to management.

A phased implementation not only spreads out cost, it also spreads out risk. Testing incrementally makes it much easier to identify any issues, and quickly pinpoint their origin. For example, if you are going from bank portals and manual spreadsheets towards a goal of having a full-blown treasury management system (TMS) integrated with all your bank transactions aggregated for analytics, reporting, and straight-through processing, you might start by having one region testing out a new TMS — or even pre-TMS, by working with a multi-bank connectivity vendor like Fides, before rolling a solution out globally.

One example would be to have Fides onboard your legal entity and banks in EMEA first. The next phase may be to add banks in the U.S. After that, you might choose to add Asia Pacific-based banks, and so on, while accessing all of these banks either through your TMS/ERP or even through the software as a service (SaaS) Fides Multibanking Suite. The second option gives you the flexibility to run bank connectivity and a potential TMS evaluation in parallel to save time, unless a decision for a TMS has already been made. As soon as the TMS/ERP is ready, you simply leverage the power of global treasury aggregation services and connect the systems to the Fides Multibanking platform. Once these systems are in place, you may choose to move off of the Fides web solutions, or leave them in place as a backup to ensure business continuity management.

The approach that is right for you will depend on your current status in regard to company organisation, existing grade of automation (whether you’re using a TMS, an ERP, or still working with Excel spreadsheets) and available resources for managing your transformation project. Partnering with Fides makes the transition easier, giving you benefits and flexibility on all three levels: the ability to connect with any TMS or ERP and use any available network, regardless of your current starting point.

Down the road you will want to keep careful tabs on progress and budget, reporting to your executive leadership team with a pre-defined cadence, whether that is weekly, bi-weekly, or monthly based on the scope of your project. This ensures visibility is high, and prevents your transformation efforts from being forgotten, deprioritised, or defunded.

Rollout

Rollout is when you take that implementation and make it widely available — if we’re using our product management analogy, it’s like taking a product GA. By this point, it’s been thoroughly tested. You may still plan to do updates to add or enhance features and functionality, but you have a solid core that is producing proven results.

In our bank connectivity scenario, this might be extending software as a service (SaaS) access to the Fides Multibanking Suite to treasury staff in multiple global locations.

Two key components of rollout are training and support.

For successful adoption, training is a necessity to ensure all team members are using the systems the way they should. You don’t want a scenario where you still have one or two rogue staff going in through a bank portal and processing transactions that you then can’t easily centrally trace because they don’t know how to access the Fides Multibanking Suite, your TMS, or your ERP.

And for ongoing success, support is mandatory — if someone has an urgent issue, whether technical or just a “how to,” they need to know where to go for help and answers. This may be a combination of in-house resources and external vendor support, dependent upon your organisational structure and needs.

Management

As I referenced in part two of this series, change is constant. Every twelve to eighteen months, technology and compute capabilities are doubling. New and innovative technology is coming out every day. Managing change proactively, incrementally, and strategically (rather than reactively) goes with the territory for any type of transformation initiative.

Best practices for treasury transformation management include managing each process every step of the way, collecting data on an ongoing basis, and documenting everything. Much like you conducted benchmarking and documentation as part of the initial assessment, you’ll want to periodically track milestones to validate (or disprove) any assumptions and determine areas where change is needed. It’s also important to keep training and support resources up-to-date and continuously available.

An example of treasury transformation in action

Global logistics and package delivery company UPS chose the Reval TMS and Fides bank connectivity solutions to power its treasury transformation. The company used a phased approach for implementation, working with Reval and Fides to roll out functionality to approximately 18 countries at a time.

UPS uses the SWIFT Network for all payment processing, leveraging the Fides BIC and its own corporate BIC. The option to use Fides’ BIC to make connections with the first wave of banks made it possible for UPS to meet its aggressive regulatory compliance-driven project implementation timeline.

With Fides and Reval, UPS has achieved close to real-time cash visibility, strengthened cash positioning, and streamlined global bank messaging and payments processing. All data flows through Fides into Reval, replacing the need for global staff to use individual bank portals.

Benefits include:

  • No more spreadsheets – An automated payments process and central repository eliminates the need for multiple complex spreadsheets and manually compiled data.
  • Near real-time cash visibility – Staff can see cash balances throughout each day to increase efficiency and improve cash positioning.
  • Automated cash concentration — Treasury can set target balances and triggers that automate transfers to UPS’ concentration accounts.
  • Greater accuracy – All this automation significantly reduces human error, making the data cleaner and more accurate.
  • Governance and control — With all data flowing through Fides, central treasury management no longer needs to worry about governance of multiple bank portals.

Now, UPS receives prior day statements and current day statements from almost all of its bank accounts, giving its treasury team nearly real-time visibility into its cash balance. This has improved reporting accuracy and allows treasury to concentrate cash in the most effective way possible.

To find out how seamless multi-bank connectivity has helped corporate treasurers around the world transform their treasury operations, you can view and download Fides case studies here.


Simon Kaufmann leads sales and marketing for Fides, including customer relations and partnerships. He has more than 18 years of experience in banking, and came to Fides in 2014 from Credit Suisse. Simon holds a Bachelor’s degree in Business Administration from the HWZ University of Applied Sciences, Zurich.

This is the third of a three-article series on treasury transformation. For information on how to get started in your journey, check out part one, “Treasury Transformation: Where to Begin” and part two “Treasury Transformation: Strategic Planning.”

 

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