Treasury Technology: First Steps

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Florence Butler
8 years ago
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2 Agenda Treasury Technology: Current Environment Treasury Technology Selection Treasury Technology Implementation - Common Implementation Challenges 2!

3 Three Key Takeaways Treasury now requires a high degree of automation in order to remain both strategic and efficient. The most critical phase of a selection process is the vendor demonstration phase. The define and design phase are critical steps in the implementation process - there are no short cuts. 3!

The most critical phase of a selection process is the vendor demonstration

4 Treasury Technology: Current Environment

5 Treasury Corporate Perspective Treasury Management Timeline HIGH Treasury Influence & Value Add Treasury 1.0 Treasury Operations is an immature, fragmented or informal function, characterized by manual processes LOW Pre Now - Future 5!

6 Treasury Corporate Perspective Treasury Management Timeline HIGH Treasury 1.0 Treasury 2.0 Treasury Influence & Value Add Treasury Operations is an immature, fragmented or informal function, characterized by manual processes Treasury centralizes key roles, improving transparency and controls Greater access to data and computing power, and consolidation of competency LOW Pre Now - Future 6!

characterized by manual processes Treasury centralizes key roles, improving transparency and controls

7 Treasury Corporate Perspective Treasury Management Timeline HIGH Treasury 1.0 Treasury 2.0 Treasury 3.0 Treasury Influence & Value Add Treasury Operations is an immature, fragmented or informal function, characterized by manual processes Treasury centralizes key roles, improving transparency and controls Greater access to data and further computing automation power and consolidation of competency Treasury is a strategic advisor, more closely integrated with business units, supporting globalization, efficiency, trading partner/supply chain integration and greater sophistication in risk/return optimization LOW Pre Now - Future 7!

roles, improving transparency and controls Greater access to data and further computing automation power and consolidation of competency Treasury is a strategic

8 Treasury Corporate Perspective Treasury Management Timeline HIGH Treasury 1.0 Treasury 2.0 Treasury 3.0 Treasury Influence & Value Add LOW Treasury Operations is an immature, fragmented or informal function, characterized by manual processes Treasury centralizes key roles, improving transparency and controls Greater access to data and computing power and consolidation of competency Treasury is a strategic advisor, more closely integrated with business units, supporting globalization, efficiency, trading partner/supply chain integration and greater sophistication in risk/return optimization Data Information Intelligence Data Information Intelligence Pre Now - Future 8!

improving transparency and controls Greater access to data and computing power and consolidation of competency Treasury is a strategic advisor, more closely integrated with

9 Types of Treasury Technology Solutions Fully Integrated Treasury Management Systems Third-party (best-of-breed) treasury management systems Enterprise Resource Planning (ERP) treasury module Bank-offered treasury management systems Specialized (single purpose) Treasury Systems Bank-to-book reconciliation Risk analytics Bank account administration FX exposure management Multilateral netting Bank fee analysis Other Bank online systems (reporting & payments) Transaction matching & confirmation systems SWIFT Corporate Connectivity Working capital management (payments and receipts) Online trading portals (FX and investments) Management dashboards 9!

Bank account administration FX exposure management Multilateral netting Bank fee analysis Other Bank online systems (reporting & payments) Transaction matching &

10 Treasury Technology Usage 1. Relatively large percentage of companies across all market sizes still do not use a TMS. 2. Where implemented, deployment of technology is often sub-optimal. Functionality available is underutilized. System is not deployed across all functions and/or geographic areas. Users (or legal entities) are permitted to hold on to exception, proprietary, customized spreadsheets and tools. Systems are not fully integrated. Old technology is not updated or revised to reflect new business needs. 3. C - 10!

System is not deployed across all functions and/or geographic areas.

11 SWIFT Overview Leveraging a single, standardized pipeline for bank communication Information Reporting Payments Transaction Matching & Confirmations Trade (LC) Processing SWIFT w w w. T r e a s u r y S t r a t e g i e s. c om 11!

Transaction Matching & Confirmations Trade (LC)

12 Traditional Bank Communication Multiple Channels Corporate T M S host to host X e-banking Y e-banking Z VAN Leased line Internet 1. Multiple transfer systems, platforms, interfaces, solutions and channels 2. Bank-driven solution 3. Inflexible design 4. Potentially unreliable channels 5. High internal and external cost 12!

Multiple transfer systems, platforms, interfaces, solutions and channels 2.

13 Today s Solution Multiple Channels One Channel Corporate Corporate VAN T M S host to host X e-banking Y Leased line Internet T M S Standardized gateway SWIFTNet e-banking Z 1. Multiple transfer systems, platforms, interfaces, solutions and channels 2. Bank-driven solution 3. Inflexible design 4. Potentially unreliable channels 5. High internal and external cost 1. One: transfer system, platform, interface, solution and channel 2. Connectivity neutral 3. Highest level of security, reliability and resilience 4. Platform for growth 5. Cost effective 13!

Bank-driven solution 3. Inflexible design 4. Potentially unreliable channels 5. High internal and external cost 1.

14 SWIFT for Corporates Growth Number of corporates registered Asia Pacific Americas 20% 10% 70% EMEA More than 1,200 banks in 100+ countries offer direct access for corporates 14!

20% 10% 70% 2004 2005 2006 2007 2008 2009 EMEA More than

15 Treasury Technology Selection

16 Technology Selection Steps Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case 16!

17 Identify Systems Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case Next Steps Treasury Management Systems Specialized (Single Purpose) Supporting Tools 17!

18 Develop Request For Proposal (RFP) Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case You Company Background Critical Requirements Vendor Informative Response Customized Proposal 18!

Business Case You Company Background Critical

19 Conduct Demos Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case Script the demo Provide examples Invite stakeholders and users Take your time 19!

20 Evaluate Vendors Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case Quantitative: RFP Functionality Pricing Qualitative: Vendor relationship References 20!

21 Finalize Business Case Identify Systems Develop RFP Conduct Demos Evaluate Vendors Finalize Business Case 21!

22 Treasury Technology Implementation

23 Implementation Steps Plan Design Build Test Deploy 23!

24 Plan Plan Design Build Test Deploy Set the objectives Define the scope Assemble the resources Create detailed project plan 24!

25 Design Plan Design Build Test Deploy Define static data Hold design sessions Obtain stakeholder sign off 25!

26 Build Plan Design Build Test Deploy Enter static data Configure workflows Establish interfaces Build reports 26!

27 Test Deploy Test Build Design Plan Unit Testing Integration Testing User Acceptance Testing w w w. T r e a s u r y S t r a t e g i e s. c om ParallelTesting 27!

28 Deploy Plan Design Build Test Deploy Big Bang or Wave? Make the calendar work for you Stabilize, then support 28!

29 The End is the Beginning 29!

30 Three Key Takeaways Treasury now requires a high degree of automation in order to remain both strategic and efficient. The most critical phase of a selection process is the vendor demonstration phase. The define and design phase are critical steps in the implementation process - there are no short cuts. 30!

31 About Treasury Strategies, Inc. Who We Are 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. What We Do Corporations We help you maximize worldwide treasury performance and navigate regulatory and payment system changes through a focus on best practices, technology, liquidity and controls. Accreditations Treasury Technology We provide guidance through every step of the technology process. Our expert approach will uncover opportunities to optimize the value of your treasury through fully integrated technology solutions. Financial Services Our experience, analytic approach and benchmarks provide unique consulting solutions to help you strengthen and grow your business. Connect With companies/ !

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