• Christofer Hedlund, Senior Consultant at SkySparc


• 24.01.2023 09:00 am
#data

How does a Treasurer mitigate the volatility of today’s markets when they also need to manage an increasing number of different data types to return value to the CFO? A treasury platform has to, therefore, accommodate all the data that the Treasurer needs to make the right decision. Whether you are a domestic business or a large multinational, data is the empowerer - both in terms of being able to collect and accommodate high amounts of data, and translate that data into a useful visualization for effective decision-making.

The challenges around the increase of data capture, however, generally go hand in hand with the expansion of the Treasurer’s remit. With more types of data captured, there are more and more integration expectations with the treasury platform.

A Treasurer’s requirements

Essentially, a Treasurer needs to integrate an increasing number of data feeds over a few key areas. The first is related to service-orientated delivery, with a focus purely on the output and the visualization of what the technology and solution delivers. The second involves vendor connectivity to third parties, for example, incorporating banking connectivity and payment hub workflow to either embed a market data service within the trading platform, integrate APIs to dealing platforms, or establish bi-directional flows for accounting, forecasting and payments (such as those needed for short term money market platforms). Lastly, a user experience is required with an updated feel and good structure, as well as ease of cross-functionality.

Treasury project implementation

In terms of ensuring a successful Treasury project implementation, there are a number of critical steps that should be covered, including:

1. Identify and locate project experience within your organization: Consider the RFP and the whole sales process, the setup implementation and training requires the same procurement as the system, and the identified department needs. Also, make sure you have a good appreciation of your IT department, for example, what is in their pipeline and how does a new TMS fit into their model so you can work with them;
2. Knowing the vision: Clear comprehension of the pain points and corporate challenges, and what the technology should be delivering;
3. Understanding the organization and culture: This will dictate how projects are managed and maintained, making sure the vendor can actually accommodate and adapt to the culture of the organization;
4. Understanding the resourcing: Making sure that the vendor can map the project deliverables to the availability of resource, factoring in things like company culture;
5. Break the project down into milestones: If incremental deliverables are achieved, ROI is recognized at a stage-by-stage concept, as opposed to an entire single implementation concept.

Treasury system capabilities

The Treasurer also needs to ensure the technology of the treasury system can handle today’s environment. For example, APIs can help facilitate the capture of that data in real-time and provide open API capability to connect to all of the customer’s data sources. In addition, advanced analytics utilizing machine learning can drive far better liquidity visibility, for instance, the ability to learn from historic data flows and historic visualizations to drive more sophisticated decision-making.

Simple reporting and analytics can also provide the ability to empower a more refined output. By way of example, data lakes can be utilized to break down the boundaries of reporting table structures within a treasury platform. Any user at either a Central Treasury or subsidiary can then drive their own analytics, workspace and dashboarding, meaning they can utilize and consume the data in a way that suits the individual user and optimize the individual user’s function within the treasury structure.

Focus on the data

In order to realize significant improvements to a treasury function, the challenges and gaps of implementing a treasury project need to be articulated clearly from the start. All parties - including the treasury department, technology consultant and vendor - need to drive each other to achieve targets. For smaller teams, treasury-as-a-service concepts also exist, delivering a standardized, out-of-the-box package which delivers quickly on ROI, and eliminates the need for any implementation.

For small and large treasury teams alike, successful Treasury modernization projects allow Treasury organizations to focus purely on the data to inform improved decision making and risk mitigation.