Selection of a treasury management system is one of the most complex decisions for the corporate treasury department, yet it has been done many times. It is not much use repeating the same questions that other corporate treasury departments have asked, again and again, what is critical is what is relevant and important to your own corporate treasury department. This requires a corporate treasury department to have a vision of what they want to achieve. Then, and only then, should you look at the system solutions available?

Deloitte’s recent report Advantage evolution: Treasury Technology Market Intelligence 2019 outlines the key principles of a successful treasury technology strategy and design, and provides an overview of available technologies including a consolidated view of the TMS market.  The report focuses on understanding the technology and the vendor market and then setting your own strategy to help the corporate treasury department make their TMS choice.

Understand the technology

Deloitte believes that treasury technology should be simple, transparent, and efficient, and they should govern the design, implementation and operation of a fit-for-purpose operation. The aim should be to place the Treasury Management System (TMS) as the anchor point of the treasury landscape, with connections to multiple platforms and data sources embedded in the wider business internally and externally:

Source & Copyright©2019 - Deloitte 

The report points out that there is no silver bullet: “Selecting and implementing the right mix of Treasury technology solutions within an established timeline and budget is difficult and requires care. Clear vision from day one and access to dedicated resources who can take time away from their normal day jobs are essential.”

Understand the Market

To help corporates understand the TMS vendor market, the report provides an astonishing amount of detail and analysis on “8 leading vendors, covering 14 individual systems, based on the Treasury Management Systems that we observe most often at our clients.” This analysis is based on a 600 question standard RFP, covering areas that Deloitte identified as the core technology for corporate treasury teams as well as their adoption of digital trends in the market.” 

They use this information to graph and analyse the coverage of each vendor, and provide summary data on the level of coverage the individual platforms provide plus market analysis. A good example of the data provided is this chart on the Average deployment time for each TMS provider (these are the vendor's estimates):

Source & Copyright©2019 - Deloitte 

The merits of how these TMS can be integrated with third-party systems, such as OpusCapita, Cashforce and TIPCO, is also covered.

Set your strategy

Leveraging digital technologies can change the role and reach of the corporate treasury function, but Deloitte makes a plea that “corporate treasury departments should resist the urge to tailor their new system to existing inefficient processes.” They believe that corporates should take the opportunity for transformational changes in their treasury processes. 

Also, the report stresses that: “Having the right TMS means implementing a solution that ‘best fits’ the business and technical requirements and flexibly accommodates future growth and business changes” which is where understanding the vendors is vital.

The Deloitte method - accelerated vendor selection

Deloitte’s approach reflects the fact that “the functional capabilities of many systems are very similar (and the differences are decreasing by the day). As a result, treasury teams can be less focused on the core functionality within the to-be TMS, and instead focus on finding the right vendor partner, one that has the right credentials to deliver what is unique about their business.”

Using the results from their 600 questions RfP and detailed knowledge of the market and the vendors, Deloitte is able to offer an “accelerated” vendor selection process:

Source & Copyright©2019 - Deloitte 

Importantly, this is combined with finding the vendor partner that suits the client’s business. This is what TMS selection is all about.

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CTMfile take: Some form of RfP, if only to get the vendor to commit that they can deliver the itemised functionality, is needed. However, this report is an impressive piece of work with a huge amount of data on the vendors and what they can provide. It is, quite simply, essential reading for any corporate selecting a TMS because it provides market analysis combined with a method that will work for most corporates. But first: corporates what is your vision?