Top Three Reasons Why Now is the Time for a TRM (Treasury and Risk Management system)

I could probably list more than 10, but here are my top three!

Reason #1 – Spreadsheets are holding you back

If you are performing all of your core cash activities on spreadsheets – e.g…

  • positioning
  • cash accounting
  • forecasting
  • financial instrument activity tracking

…then you probably know now is the time for a TRM.

Even if your treasury is fairly simplistic, it rarely makes sense to have data in spreadsheets instead of in a database where it is usable for future analysis. And, if your treasury isn’t especially simple, and you are actively managing more than two or three of the following activities:

  • over 50 bank accounts worldwide
  • debt or investments
  • foreign exchange activity
  • pooling
  • daily concentration and funding
  • cash accounting
  • more than 5 treasury initiated payments a day
  • in house banking
  • multi-lateral netting
  • cash flow or balance sheet hedging, or
  • hedge accounting

Then you probably know that it wouldn’t take too much effort to unknowingly make a major error.

Automating repetitive tasks and getting all of the data in one place from a single point of entry just makes sense. Your reporting will be holistic, easier, and more informative. Everything will automatically be updated to cash position and longer-term forecast. The valuations on your financial instruments can be done at the click of a button, across your entire portfolio. You can answer the questions that come down from your CFO or Treasurer in minutes instead of hours or days. Need I say more?

Reason #2 – You have outgrown your old TMS and/or it is no longer actively supported by your vendor

How do you know if you’ve outgrown your old TMS? Ask yourself:

  • Do you have dozens of side spreadsheets you utilize because your current system does not support certain types of activities?
  • Are you using your current system for cash in your home country, but it is not capable of handling your global activity?
  • Do you have to create all of your executive level reporting in Excel because there are no dashboards or good reports available with the necessary information?
  • Do you still use yellow (or pink) stickies to remind yourself and your team of important upcoming treasury events like debt payments?
  • Is it too much trouble or too expensive to upgrade to the latest version?
  • Or, worse yet, is there not a latest version at all, because your product isn’t supported by your vendor?

If you answered yes to any of these questions, then now is the time for a new TRM. Treasury and Risk management technology is offered over the web as a SaaS (Software as a Service) offering with regular updates that require no effort on your part to upgrade (updates/enhancements/improvements just happen – like updates to Gmail or Yahoo or your bank software). Not only that, but TRM supports all areas of treasury and risk for large global organizations (they are not your daddy’s old domestic cash system anymore)!

Reason #3 – Treasury can add real value to your organization when empowered with the right tools

Some treasury functions have to happen each day and can be largely automated so that you free up time to add real value to your organization. Have you been intending to build/improve a cash forecast and perhaps, even give feedback with forecast to actual data to the business units who contribute to the forecast?

Have you been thinking about different coverage for your hedging program but haven’t had the time to model the different possible scenarios and articulate your recommendations in a meaningful way for senior management and the Board? Did you hear about payment factories and/or in-house banks at the annual AFP conference or EuroFinance and think it might be applicable to your company but haven’t really explored the possibilities yet?

A SaaS TRM is a tool to help with all of these areas and can immediately improve existing processes and/or help give you a framework around which to build future processes.

The 1st Quarter of 2014 is over, so take these top 3 and consider TRM today!