How Half Of Corporate Treasurers Are Getting Left Behind

Between omnichannel procurement, multi-rail payment tools and cross-border trade, treasury management systems (TMS) seem like an obvious necessity for modern conglomerates. Yet, it’s only in the last few years that these platforms have become commonplace — at least, for some businesses.

Nearly half of the companies surveyed by the Association for Financial Professionals (AFP) and Bloomberg aren’t using a treasury management system. But for the 51 percent that have integrated such a solution into their operations, the benefits are enough to stick with the solution.

According to the study, which was published last week, the corporations using treasury management systems see that their tools are most effective in providing greater cash visibility and transaction capturing.

The majority (64 percent) also pointed to compliance and process control as key benefits of their systems.

The Association for Financial Professionals is not the only group to recognize the ability for treasury management technology to boost a company’s performance.

Treasury management firm GTreasury recently promoted its own view of the TMS at this year’s TEXPO Conference, held last week. Ahead of the event, GTreasury EVP Warren Davey spoke on the ability for treasury management systems to support corporate compliance.

“We see regulators everywhere requiring that institutions not only have the cash they need,” he said in a statement. “They’re also insisting that the organizations have a clear understanding of their liquidity risk, both intraday and long-term.”

“That can’t be done with spreadsheets any longer,” the executive concluded.

TMS proponents put their money where their mouth is when it comes to their own use of these tools, too. According to AFP, more than three-quarters of businesses that deploy a treasury management system have been using one for the last three years; 35 percent reported having theirs in place for between three and five years, and more than a quarter (27 percent) stated that they’ve had a treasury management system for an impressive eight years.

Researchers noted, however, that the length of time a company has used a TMS doesn’t necessarily correlate with whether that system is outdated or not.

“Despite the longevity,” AFP said in its announcement, “treasury professionals make efforts to ensure that their organizations use the most recent version of their TMS.” More than half of survey respondents that use a treasury management system said theirs is the most recent version; a third said that theirs is no older than one or two versions behind the newest.

Recent analysis from Voice & Data pointed to several trends for treasury management technology this year.

The rise of cybercrime, for example, is one of the strongest reasons corporations should deploy an up-to-date treasury management system, the publication said, noting that the heightened awareness of cyberthreats among C-level executives has led them to also demand more sophisticated threat detection and mitigation in their treasury management platforms.

Further, Voice & Data said cloud and mobile technologies will be the way forward for treasury management tools this year. Reduced IT and software costs, coupled with the ability for corporate treasurers and money managers to gain real-time visibility into cash positions, mean the cloud- and mobile-based TMS will be a critical part of these executives’ roles.

“Corporate treasury has evolved into a truly strategic function for most organizations,” the publication stated. “From being a manager of liquidity and financial risk, corporate treasurer has evolved into a strategic business partner.”

The increased adoption of technology by treasury management systems means corporations will be tasked with remaining current. So far, so good, suggests AFP’s report.

Further analysis from the Association of Financial Professionals found that, for the companies deploying a treasury management system, not only are they keeping them updated, they’re happy with the results, AFP concluded.

“All departments have to make do with less these days, and treasury groups are no exception,” said AFP President and CEO Jim Kaitz in a statement. “It’s good to see that treasury professionals are getting the most out of their TMS and, in doing so, providing excellent cash visibility and improved decision-making for management.”