Building the Business Case for Transformational Treasury Technology

Transcription

1 Building the Business Case for Transformational Treasury Technology PRESENTED BY: Tracey Ferguson Knight Director - Solution Consulting, Reval MNAFP April 28, 2015

2 About the Speaker Tracey Ferguson Knight Director, Solution Consulting (NA) Reval 20 years in Treasury Corporate Cash Manager Remittance Operations Revenue Operations Treasury Software Vendor Demonstrations Implementations Training Client Events BS in Economics University of Pennsylvania, The Wharton School Frequent Speaker at national, regional, and local conferences Author of treasury articles and blogs 2

3 Your Objectives. Our Mission. A Strategic Partner. Founded in 1999 to bring an all-in-one solution to the market to transform the way companies manage treasury and risk. 600 clients+ in over 20 countries including all 4 of the Big 4. Reval provides sophisticated financial risk management functionality with cash and liquidity processes to support complex risk requirements. Our all-in-one SaaS solution can easily interface with any 3rd party system including ERP systems and trading platforms. With Reval, treasurers and their teams can increase efficiency, decrease manual errors and achieve complete visibility into their cash positions and risk exposures globally. 3

4 Agenda o What is Driving Treasury Transformation? o What is Transformational Technology? o The Business Case for Treasury Transformation o Client Examples of Treasury Transformation Projects 4

5 A Few Stats to Get Started 5 From the 2014 AFP Guide The Strategic Role of Treasury

6 Strategic Treasury 6

7 Strategic Treasury 7

8 Data Information Intelligence Evolution of Transformational Technology 2000 s Global Accessibility Global Connectivity transforms the way companies use software and the way providers deliver solutions 2010 s Cloud Computing 1980 s Individual Efficiencies Personal Computing provides for rapid application development and effient access to computer processing and data 1970s Mainframe and Mini s 1980 s Personal Computers 1970 s - Processing 1990 s Client Server Large scale platforms enabled businesses to store and process business data 2000 s www and.com 1990 s Departmental Enablement By centralizing application on servers, controls are created and data is shared by many 2010 s SaaS Standard Responsive, Accessible, Flexible and Cost Effective solutions now possible with SaaS and Cloud solutions Excel Client-Server SaaS 8

9 Value of SaaS Solutions Standard of Excellence Client Server Software SaaS Solutions Flexibility Accessibility Responsiveness Cost Effectiveness Avoid Change Old Technology Long Upgrades, Can Fall Behind Hidden Costs Embrace Change New Technology Scheduled Upgrades, For All Transparent Costs 9

10 Why Build a Business Case? o Treasury Transformation Drives a New Level of Business Value for the Organization Competitive & Compelling Business Value vs. Cost Center o Required To Support the Funding for a Successful Treasury Transformation Project Strategy Investment vs. Tactical Plug the Problem o Helps Define the Strategic Value To Internal Clients / Partners Promotes A Stronger Internal Partnership with Business Units 10

11 How Does TRM Add Value? Forecasting & Budgeting Globalization Business Intelligence Liquidity Risk Management Scalability Technology Settlements Continuous Improvement Compliance Regulation Business Process Optimization 11

12 Recipe for a Treasury Business Case o Treasury ROI Ingredients Business Value Drivers: Managing Financial Market Risk Liquidity Planning Compliance Operational Efficiency & Effectiveness Technology Drivers: Enablement Cost o Business Case Model Revenue Expense ROI 12

13 Analyze Present & Determine Future o Analyze/Improve/Eliminate Current Processes Identify areas of pain where is improvement is mandatory Identify areas where improvement is desired best practices Identify all resources required for a timely and successful implementation Prioritize immediate and near term needs o Determine if Help (Consulting) Needed Process Review Selection Process Implementation 13

14 How Do You Measure Success? 14

15 Strategic Areas for Improvement o Intercompany Loans IHB Netting ICL POBO ROBO o FX Hedging o Commodity Hedging (bifurcating delivery from pricing) o Cash Forecasting 15

16 A Successful Treasurer Must. And so should you!!! 16

17 ROI Consider All Types of Risk 17

18 Building the ROI Discovery Questions Financial Market Risk What would be the expected basis point increase if you had a loss from derivatives and/or credit rating decrease? Enter # of basis points 0 What is the total amount of debt on the balance sheet? Enter $ impact (in millions) 0 What is the total annual volume of simultaneous forward FX deals that could have beeen off-set? Enter gross amount (in millions) 0 What is the average spread paid to banks of FX deals? Enter # of basis points 0 What is the maximum annual value of unhedged FX currency exposure? Enter gross amount (in millions) 0 What amount would you like to hedge? Enter gross amount (in millions) 0 What is the average volatility of the FX currency exposure? Enter percentage 0 What is the maximum annual value of unhedged commodity exposures? Enter gross amount (in millions) 0 What amount would you like to hedge? Enter gross amount (in millions) 0 What is the average volatility of the commodity exposure? Enter percentage 0 Compliance Risk 18

19 Real Client Examples o Requirement Automate daily cash accounting o ROI - $80K annually (1 FTE) o Requirement - Global cash visibility and cash forecasting o ROI - Expect to pay down an additional $10M in annually o Requirement Hedge $400M of FX annually o ROI Automated trading spread improvements = $500K annually o Requirement Reduce P&L volatility o ROI Increased credibility to the street with better forecast (Priceless) 19

20 Questions? Tracey Ferguson Knight Director, Solution Consulting Reval (972) Complimentary toolkit available at: Needs assessment checklist Sample RFP Demo agenda Implementation checklist 20