Step-by-Step Guide to Selecting Treasury Management Systems for Corporate Purposes

Many corporate treasury managers have been persuaded to make the change to the Treasury Management System, based on the list of benefits it offers. The general opinion is that this system can make considerable improvements to corporate performance, by increasing funds efficiencies. This in turn improves financial control and risk management. It also goes on to reduce the borrowing cost through a better cash management system.

The challenge for the current treasurers is to go through the array of management systems that are available and choose one that matches the organization’s needs in terms of cost, efficiency and quality. Finding the right one can be tricky, especially in such a diverse market. So, it is best to use certain parameters to decide on the best possible course of action.

How to Select a Treasury Management System

Here is a list of factors that will guide you while you look to make the right decision for your company.

  1. Functionality: When selecting a course of action, one must ensure that the functionalities meet the business needs. A Treasury Management System is generally expected to perform transactions and cash management, while effectively ensuring that there is a risk management tool in place. Also, as the business changes and the company expands, the system should seamlessly adapt to this change, which is why it is better to forecast the growth plan of the company and then choose the system based on the company’s present and future needs.
  1. Security: Since this system is expected to house sensitive financial information of a company, security is imperative. It should be a foolproof system that does not succumb to the trivialities of hacking and manipulation.

 

  1. Interface to ERP: A Treasury Management System should be able to communicate effectively with the organization’s ERP and payment systems, as well as other related systems. Coordination is essential, and a system will be fruitless if it cannot weave the company into one single unit. However, this should not add to the complexity of the system, which should continue to be user friendly.
  2. Vendor Service: Treasurers ought to look for vendors who understand the company’s requirements, and who are also willing to invest in a lasting business relationship. To this end, they should be valued against knowledge, flexibility, responsiveness and their delivery ethics.
  3. Value: Simply put, benefits should definitely balance the cost. The advantages should not only be curtailed to the criteria of choosing, but should also cover long term performance.

 

These factors can be followed for setting up a Treasury Management System for corporate houses of any size. The goal of this system is to prove that size, in essence, does not matter when it comes to efficiency.

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