Cash is King – A View from the Enterprise Software Perspective

By Kyriba October 28, 2013

The enterprise software industry – in particular the SaaS market – has gone through several phases over the past dozen or so years. At each inflection point, the focus has changed, as forward thinking companies have moved away from simply focusing on “product” and “sales.” Around 2000 came the CRM revolution, with organizations such as Salesforce.com emerging on the scene. Later in the decade, the focus turned to talent management, with brands such as Cornerstone OnDemand making headway. Now, with the Great Recession still fresh in everybody’s memory, the mantra is that cash is king. 

Customer is king.

More than ten years ago, the message that really starting to resonate with organizations was that your customer is king. Client loyalty was key to an organization’s success – customers were just a click away from your competitor and the new normal focused on the tight link of a customer’s experience with your brand to an organization’s success.  Software vendors such as Salesforce and RightNow benefitted greatly from this market movement to focus on the customer. The “customer experience” became a common term and companies were striving to provide the best possible user experience across all channels.  And this continues to be the case today, more than ever.

Talent is king.

A little over five years ago vendors such as SuccessFactors, Cornerstone OnDemand and Taleo drove and benefited from a big focus on the importance of talent (your employees) to your organization. And rightly so; if a high potential / high performance employee leaves your organization to go to the competitor, the (negative) exponential effect on your company’s success is measurable and significant.  Numerous studies have been conducted on the impact of employee engagement (or dis-engagement) on an organization’s revenue and even stock price. So talent had become king, driving new roles within organizations such as Chief People Officer, and this has also led to high profile acquisitions and exits in this highly valued software space.

Cash is now king.

With the Great Recession of 2008-2009, where market volatility has become the new normal and ready access to liquidity is critical to business continuity and growth, Cash has truly become king. How well organizations protect, maximize and leverage their cash to drive value to the company is essential to business failure or success. In addition, Wall Street expectations around financial performance have never been so high.  Organizations are confronting an increasingly rapid pace to conduct business – and agility and investments are needed to keep pace in this highly competitive environment. This includes expansion into new markets and new products, which exposes businesses to more risk, including currency and interest rate fluctuation as well as counterparty risk.  Hiring new talent and acquiring and retaining customers takes cash.

Organizations that proactively manage their cash and treasury operations are reaping great benefits. Cash is a key lever for growth and organizations are protecting their cash through execution of strategic risk programs. In addition, organizations that have visibility and control over their cash are creating new business value, through M&A, supply chain performance, revenue incentive programs, the hiring of top talent, market expansion, and the launch of new product offerings. 

As such, the office of the CFO and treasurer is king – as cash is the new currency to drive business growth. And treasury and risk management software solutions such as Kyriba can provide the visibility and control to drive that growth.

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