Since the economic crisis, corporate treasurers have seen their roles expand as CFOs look to them to begin playing the part of strategic advisor to the business. The only problem is, treasurers lack the systems to do that efficiently and effectively.
What corporate treasurers have today is a hodgepodge of expensive and time-consuming one-off connections to their banking partners—an average of 12.7 per treasury department, according to preliminary results of an SAP/CFO Research survey of corporate finance professionals.
Worse, each distinct connection can take from nine months to a year to put in place—a glacial pace for corporate treasury functions expected to keep pace as their companies expand globally. According to the research, 61 percent of respondents reported some difficulty with the connection and communication between their systems and their banks’ systems.
What Are Treasuries’ Top Priorities?
Treasurers said that their top priorities for the future are:
- Optimizing treasury processes
- Upgrading treasury information systems or technology
- Integrating better with non-treasury information systems or technology
How should treasurers address these priorities? What they need is a faster, simpler way to connect to their banking partners that also gives them a consolidated view of their enterprise’s financial positions and real-time access to actionable information.
Treasurers Are Ready for Cloud
That could happen in the cloud—at least that’s what finance execs told us in the survey. A total of 41 percent said they would either be early adopters or fast followers of cloud, with just 12 percent shying away from cloud solutions.
An integrated cloud service could connect banks and corporate treasuries to handle payments, statements and other messages. But the cloud could also serve as a foundation for the kinds of business intelligence applications that harness data required to transform the once clerical, order-taking treasury function into the strategic advisor the business demands.
Banks Aren’t Responding to the Demand
Corporate treasurers are game for the cloud. The banks that serve them? Not so much. Security and authentication—the trust element—is a very large factor in the banks’ anxiety about cloud computing. To be fair, an increasingly heavy regulatory atmosphere is also preventing banks from moving as fast as some of them want. And there is no question that the economic crisis has slowed innovation. But banks are slowly beginning to emerge from the post-crisis chill.
They may want to pick up the pace. The transaction business banks get from corporate treasury is guaranteed annual revenue those financial institutions need, and competition for those accounts has never been greater. Making life easier for corporate treasurers with more seamless, standardized connections will help them hold onto that that business. New value-added services could enable them to win even more.
Get More Information from the Survey—and Come See Us
You can read a Q&A interview that goes into more detail on the survey findings. We’re also going to be revealing more findings in presentations at the SIBOS conference this week.
If you’re in Osaka, be sure to visit us at stand 5E15 in HALL 5. If you’re not, join the dialogue online: #sapbanking.
Robert Grimes is a director for SAP’s Solution Management and Value Added Solutions. Leonard Schwartz is a director of solution management for SAP.