Selecting and Implementing

Treasury Technology

From the Corporate Perspective

August 2012

Overview

The case for treasury technology has never been

stronger. The financial crisis and recession have

changed our global economy. The outlook for

corporate treasury has evolved as a result. Now, it

is even more imperative that treasury respond

quickly and strategically to both internal and

external stakeholders.

However, successfully selecting and implementing

a treasury technology system remains a challenge

for many corporates. Understanding the factors

that determine success will enable corporate

treasuries to realize many benefits from these

important tools as departments move toward

Treasury 3.0®. This third generation of treasury has

already started to transform the scope and

influence of treasury departments which are

becoming the financial nerve center of the

organization.

 

During the second quarter of 2012, Treasury

Strategies reached out to 150 corporate treasury

professionals from around the world. These

executives helped us better understand the key

success factors of treasury technology selection

and implementation.

We found that risk perspectives have altered.

Treasury technology is now an essential. Corporates

demand − and in some cases, are required − to

have current, global financial information with

sophisticated analytics and intuitive reporting. More

corporates are considering bank connectivity for

treasury technology projects, in keeping with the

variety of solution offerings from Treasury

Management System (TMS) and other technology

vendors. Good TMS tools and streamlined bank

connectivity are no longer optional.

Technology Selection

Vendor selection can be time-consuming and

confusing. It can be difficult to find meaningful

points of vendor differentiation. It is also difficult to

assess how the system will work in the corporate’s

environment.

Treasury Strategies found three key areas of

success in the selection process: strong project

leadership, a comprehensive process, and

detailed vendor demonstrations.

•  Firms that combined external consultants with

internal treasury resources to lead their

selection project report the highest overall

satisfaction. 70% of companies that reported

less than satisfactory results did not use outside

resources.

•  Most organizations include a business case,

Request for Proposal, vendor demonstrations

and calls to references among the steps in a

system selection project.

•  Companies that used custom vendor

demonstration scripts in their selection process

report a higher satisfaction with both selection

and implementation.

Experienced outside consultants use their

knowledge of company-specific requirements to

design vendor demonstrations that showcase the

most relevant product capabilities. Tailored vendor

demonstrations are the most crucial part of a

treasury system selection.

Technology Implementation

Implementing a treasury management system is a

major undertaking, with the inevitable budget

constraints, overburdened staff and tight timelines.

Strong project management is the key driver of

success.

•  Companies that used an external project

manager are markedly more satisfied with their

implementations than those that used a treasury

staff member or other internal resource to

manage the project.

•  56% of respondents who only used treasury

resources were disappointed with their

implementation results.

•  Delayed timelines are the most frequent source

of implementation dissatisfaction. Overburdened

vendor resources and lack of access to internal

resources were cited frequently in low

satisfaction rankings for implementation.

•  Scarcity of internal resources and access to

stakeholders during implementation occurred in

almost half of the implementations surveyed.

 

Good project management is critical for a good

implementation. Implementations can be

complicated and lengthy; resources from several

areas are usually involved, and missed deadlines

can be painful. All these issues underscore the need

for a project manager who really knows treasury

implementations, who can identify and solve

problems as they arise, marshal internal resources,

oversee the vendor relationship and keep the

project on track.

Treasury Technology Trends

The treasury technology landscape is active with

change; there are several trends to be aware of.

•  Companies that have a TMS are glad they do. 66%

of respondents use a TMS and report that they are

satisfied, very satisfied, or extremely satisfied with

their system’s functionality.

•  Firms that expect to buy new or additional

technology are most interested in Software-as-a-

Service to reduce dependency on IT support. This

trend may reflect the frustration with internal

resource scarcity noted by many implementers.

 

•  Cash management (cash reconciliation, cash

position, forecasting) and treasury accounting are

the most in-demand functions from a new TMS.

•  Bank account administration is now on the

shopping list for almost 55% of respondents.

•  Use of financial risk management tools is on the

rise.

•  Of respondents who have treasury technology, 60%

use a TMS, while 12% use the Treasury modules of

their ERP system (SAP, Oracle, PeopleSoft, etc.).

 

•  The top secondary treasury platform functionality

is for FX trading. 36% of companies use this type

of platform.

 

•  44% of respondents expect to select/implement

some new technology in the next 18 months.

These plans include replacements for outgrown or

old systems, plus specialized functionality that bolts

onto a current system.

Methodology

The study was conducted via online questionnaire

and in-depth phone interviews during the second

quarter 2012.

 

Approximately 150 treasury professionals

participated in the survey. They represent corporate,

non-profit, and government entities from North

America, Europe and Asia.

4

Conclusion

The economic and regulatory environment have

altered risk perspectives and catapulted treasury to

the forefront. Treasury technology is now an essential

business tool rather than an optional commodity.

Corporates demand − and in some cases, are

required to have − current, global financial

information with sophisticated analytics and intuitive

reporting.

Difficulties that plague software selection and

implementation can be circumvented, which starts by

not taking the do-it-yourself approach.

Technology selection requires strong project

leadership, a comprehensive process, and detailed

vendor demonstrations.

Implementation demands an experienced project

manager who knows both treasury and technology

implementations. Strong project managers help

resolve problems, marshal internal resources, oversee

the vendor relationship and keep the project on track.

About Treasury Strategies, Inc.

Treasury Strategies, Inc. is the leading Treasury

consulting firm working with corporations and

financial services providers. Our experience and

thought leadership in treasury management, working

capital management, liquidity, and payments,

combined with our comprehensive view of the

market, rewards you with a unique perspective,

unparalleled insights and actionable solutions. Visit

www.TreasuryStrategies.com for more information.

For further details, please contact Laurie McCulley,

head of our Treasury Technology practice;

laurie_mcculley@TreasuryStrategies.com.

76%

14%

6%

3% 1%

Respondents by Region

North America Continental Europe

United Kingdom Asia

Middle East/Africa

25%

15%

32%

11%

17%

Respondents by Revenue Size

Over $10 billion $5-$10 billion

$1-$5 billion $500 million-$1 billion

$0-$500 million

© 2012 Treasury Strategies, Inc. All rights reserved.

info@TreasuryStrategies.com  TreasuryStrategies.com  

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