A treasury management system (TMS) can bring numerous significant improvements to your treasury, such as automating manual processes, reducing fraud risk and elevating the strategic function of the team to optimize working capital. But before you can bring these benefits to your team and the organization as a whole, you will first need to implement the new system.
During a recent webinar, we polled participants about their experience of TMS implementation. The results were telling: of those who had carried out an implementation, only 16 percent said that implementation went perfectly – while almost 66 percent said that both the vendor and the treasury “could have been better”. Go to Kyriba’s resources page for a full replay of the webinar.
It’s clear that things can go wrong on both sides of the equation. The good news is that when you work with an experienced vendor, there is plenty that you can do to plan ahead for unexpected scenarios. Here are five ways that you can avoid the pitfalls and get the most value from your TMS implementation:
1. Prioritize your requirements at the outset
When it comes to implementation, it’s crucial to establish the priorities of the project at the start. Developing a robust business case will help you stay focused on the core goals and avoid getting side-tracked by other issues. It will also help you when it comes to planning the different phases of the project – and will minimize the risk of selecting an unsuitable TMS.
Related reading: 7 Competitive Advantages of the Modern Treasurer
2. Obtain a watertight statement of work (SOW)
Drawn up before the contract is signed with the TMS vendor, the SOW is effectively a written promise which lists your needs and sets out what the vendor is going to provide, along with the relevant terms and conditions.
It also forms the basis for the blueprint document, which is drawn up once the contract has been signed, and drills down into the details of how the new system will be implemented. The more detailed the blueprint, the less need there will be for the vendor to raise questions with you once the implementation is underway.
3. Make sure the resources you need for the project are available – when you need them
The implementation will involve a number of people on your side, including a project manager, system administrator and subject matter experts. You’ll also need one or more power users who will receive training on specific modules.
If your implementation is to progress smoothly, you’ll need to make sure the right people are available at the right times so that resourcing doesn’t become a problem further down the line. This means taking into account personnel changes, upcoming vacation and any ‘blackout periods’ where the team may need to focus on other tasks.
4. Choose the right implementation approach
At one end of the spectrum, vendors can handle everything for you – and at the other, some corporates prefer to do everything themselves. In practice, most treasuries opt for a hybrid model. For example, while six percent of the webinar audience said they wanted to do everything themselves, seventy five percent said they would like the vendor to train their power users for them.
While many companies base their chosen approach on cost considerations, a better option may be to start by identifying how much time you can realistically dedicate to the project. If you take a proactive role, you’ll need to factor in plenty of time: as a rule of thumb, for every hour the vendor spends on the project, the treasury team will need to spend three hours. If your team doesn’t do their homework in between training sessions, key tasks may be delayed and you may need to rely on your vendor more heavily than expected.
5. Don’t aim to replicate everything you are doing today
Finally, implementing a TMS brings considerable opportunities to improve processes and workflows. If you simply automate everything, you may not get the maximum benefit from your new system. So take time to consider whether the processes already in place are the best possible fit for your treasury – or whether they have been set up in this way because of technical limitations. Conversely, it’s also important to identify the processes that are working perfectly well. Remember that you can lean on your vendor for insights into best practice when making these decisions.
In conclusion, very few treasury and finance professionals have experienced a perfect TMS implementation, though it is achievable. With a clear plan and realistic expectations, the value of a modern solution such as automating manual tasks, adding financial controls and preventing payments fraud can be applied in a set it and forget it mode, and treasury can elevate their focus to more strategic functions such as driving working capital optimization programs that accelerate growth for their company.