TMS’s have evolved over time and especially in the last couple of years with a huge leap in technologies. Treasurers are investigating how TMS can help in further modernising the finance function in the coming years.
The strategic and key role of treasury teams has increased steadily over last decade. This evolution reflects the increasing complexity of business and C-level expects TMS’s to continue to respond to the increasing pace of changes. Finding the right responses to face these emerging challenges makes the difference in a complicated economic environment. To be successful and resilient, treasury needs a scalable and well-defined target, a forward-looking governance structure, and appropriate IT architecture, but also state-of-the-art solutions.
At treasury level, the central technology is the calculation and processing power of Treasury Management Systems (i.e. TMS’). They are at the forefront of driving automation of treasury tasks, straight-through-processing, and integration with other systems. To reduce the need for customisation, the TMS choice needs to fit specific business requirements today, but also in the future. Beside this TMS evolution, there are disruptive technologies proposed by FinTechs, which change the way customers and businesses interact. Likewise, robotic process automation and AI open new possibilities of machines performing cognitive tasks based on historical data and even learning how to carry out those tasks. More systems are implemented in the cloud, as pure Software as a Service (i.e. SaaS) application or in private clouds on dedicated customer databases. This trend is of course driven by cost reasons to outsource IT infrastructure and security to dedicated vendors. All these evolutions will enable to deliver more “Treasury-On-Demand” (i.e. TOD) functionalities.
Very often treasurers are not entirely happy with their TMS. These tools been around for so long now, but there is still a vast chasm between what treasurers expect from a new solution and what it can deliver, generating a form of frustration. One useful step towards alleviating this disappointment would perhaps be to not have too many fixed ideas about the tool and to define the solution that best fits your needs. If you start from the belief that you are seeking the best or most suitable solution possible rather than perfection itself, you are more likely to be able to avoid that so common exasperation. This approach can best be summed up as the Coué Method, i.e. the calibration of your expectations and the setting of (more) reasonable ones, without allowing yourself to be thrown off course by an over-enthusiastic vendor.
The pressure on treasurers to deliver more or better-packaged information is growing. We entered the era of TOD. There is also more pressure in terms of the cost of tools, so our strategies will have to change and the solutions may also follow suit in response to treasurers’ increasing requirements regarding reports and regulatory compliance. In order to increase productivity and quality, it’s vital to harness the development of IT tools, but it will require creativity and talent within treasuries to achieve this objective. Treasurers therefore need to think about recruiting differently in the future and technology should be envisaged as an opportunity to review our role and its scope. Treasurers are going to have to become “data consumers”.
Finally, everything will hinge on a treasurer’s appetite and capacity for change. Technology is the saviour and the future, at least for treasurer’s adept at mastering and harnessing it. Only technology can lighten the workload to leave you free to focus on analysis and strategy. Over the coming 5 years, the biggest challenge will lie in this capacity to gradually evolve, bit by bit, towards greater digitisation.
Vice-Chair of EACT and Chairman of ATEL