Treasury and Its Systems: From Treasury Workstation to Cloud Platforms for Treasury and Risk Management

Treasury and Its Enabling Technology

In 1970, most business people probably could not have told you what a treasurer is. But today, treasurers are considered strategic partners that can add significant value to the business by aligning the company´s financial strategies with its growth strategies.

As treasury’s profile and the treasurer’s role have evolved, so has treasury technology. Here is a brief overview on the evolution of this function and its supporting technology.

1980-1990: Treasury Workstations (TWS)

Treasury is a young function within the enterprise that’s focused on collecting transactional data. Forward-looking finance teams use treasury workstations to track cash and investments from decentralized entities. The treasury workstation is the first software that’s specifically designed for the corporate treasury department, using the common desktop technology of the era.

1990-2007: Treasury Management Systems (TMS)

The treasury department emerges as a hub for financial information. Key processes are centralized and standardized to improve transparency and control. Treasury Management Systems (TMSs) help finance teams automate treasury operations, particularly cash management. Commonly using client server technology, Treasury Management Systems are stand-alone solutions that can be integrated with other software used in treasury. The finance team collaborates with the system provider and the internal IT department to implement, roll-out, integrate and maintain the Treasury Management System.

2008-now: Cloud-based Platforms for Treasury and Risk Management (TRM)

After the financial crisis, risk management catches the attention of corporate boards, and treasury evolves to become more of a strategic advisor within the corporate structure. Closely integrated with their company’s global business units, treasury teams handle cash, liquidity and exposures on an enterprise level. From a technology perspective, platforms for Treasury and Risk Management (TRM) make it possible to manage cash and risk in the same system, providing integrated information to present forward-looking intelligence to the board. Cloud-based platforms for Treasury and Risk Management make it is easy for treasury organizations to work across business units, geographies and departments and to connect to banks and third party systems. Finally, the cloud enables companies to shift the cost and hassle of maintaining hardware, software, interfaces, security and upgrades to the software vendor.

Technology and the Pace of Treasury Transformation

Transitioning from a transactional function to a strategic center of expertise, treasuries continue to transform at their own pace. Teams will assess the processes, policies and technologies that best fit their organizations, and the winners will be the ones that continue to meet their business’ evolving needs.