Building the business case for a TMS

By Kyriba September 8, 2015

Most corporate treasury departments know when the time is right to implement a treasury management solution (TMS), and it’s no longer feasible to rely on spreadsheets as their primary treasury tool. After all, experts and analysts agree that a TMS provides significant benefits by improving overall efficiency, time savings and control. However, the challenge lies in building the case internally to prove the benefits of adopting a TMS, and this often requires hard dollar figures in terms of either savings made or incremental added value achieved. 

At its heart, a TMS reduces the time treasury spends on activities such as:

  • Consolidating and aggregating data
  • Logging into multiple banking portals
  • Generating accounting entries
  • Troubleshooting spreadsheet formulas
  • Re-keying information
  • Manually preparing urgent reports and dashboards

On its own, this increased productivity can enable the treasury team to save anywhere from tens of thousands to hundreds of thousands of dollars per year. However the true benefit of treasury automation is not the time savings itself, but the value that additional productivity provides. If your CFO or procurement department is looking for additional value that the TMS can bring, consider some of these common areas, along with some real-world dollar benefits that our clients have experienced:

Increased cash visibility
Key areas of value: Increased the horizon and accuracy of cash forecasting; deeper visibility into domestic and global bank accounts
Real-world example: A large healthcare provider found that implementing Kyriba helped accelerate the matching and reconciliation of daily cash, allowing it to better predict cash requirements. Through this improved visibility, the client was able to shift overnight investments – the alternative for its previously idle cash – to more strategic investments, earning an additional 200 bps on that formerly idle cash.
VALUE: $1,000,000 per year

Reduced bank fees
Key areas of value: Centralized reporting, lessening the number of reports per day; lower number of users requiring bank portal access; eliminating the requirement to pay for bank statement storage
Real-world example: A market research provider was paying $17,500 per month for transaction ledger reports generated by its bank. By implementing Kyriba’s robust reporting tools, the company was able to eliminate this fee.
VALUE: $210,000 per year

Lower IT investment through SaaS
Key areas of value: Eliminate upfront license or upgrade fees, no need for IT involvement during implementation or support; economies of scale for security and hosting
Real-world example: The implementation of Kyriba and its state-of-the-art disaster recovery facilities eliminated the need for a global manufacturer’s prior business continuity plan and corresponding IT support. In addition, the treasury team improved the committed uptime from 95% to 99.9%, an improvement of one day per month.
VALUE: $90,000 per year

It goes without saying that there are countless other benefits – both quantifiable, such as more effective cash deployment, and operational, such as reduced exposure to financial fraud – that each organization can experience as the result of deploying a TMS. 

If you are looking for more reasons to assess a treasury solution, or have been tasked with developing a business case for your organization’s TMS investment, you can read more about the ROI that a TMS can deliver in the ebook, Building the Business Case for a Treasury Management Solution.  

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