Strengthening Treasury Management with NetSuite and Kyriba

By Kyriba December 15, 2014

I recently had the pleasure of speaking with Guido Haarmans, Vice President of NetSuite’s Developer Programs and Business Development. We discussed the CFO’s changing role, shifts in the market, and the types of solutions that are necessary for the inevitable progression. Our conversation was originally published in December’s edition of NetSuite Magazine

Today’s economic climate is still adjusting to the repercussions of the 2008 financial crash. Leadership and management methodologies have changed, as have the responsibilities of the executives guiding the enterprise through those transitions. The Chief Financial Officer (CFO) is one role that continues to evolve. In the past, the CFO’s primary responsibility was on the accounting side, ensuring the company was in compliance with accounting rules and investors were kept apprised of corporate performance and strategy.

Today, the CFO maintains a more heightened focus, placing greater efforts on cash liquidity and allocation, financial preparation strategies, tax expertise, and assuaging the needs of the company board and CEO.

Guido Haarmans: What is the position of the CFO in a company today, as compared to what it might have been a decade ago?

Greg Person: In the current market, the CFO must support the overall growth of an organization. With that comes a high level of complexity, including banking considerations, liquidity structures, financing, and identifying opportunities to move the business into new markets. CFOs must ensure risk management programs are in place, and measure levels of exposure—in banks and currencies—in different countries. CFOs are at the forefront of identifying and investing in SaaS tools that provide real-time solutions and offer operational control. CFOs understand the importance of having the right infrastructure from your ERP, through finance support systems, to your banks. Standardizing and automating these controls as much as possible helps to drive business growth while mitigating financial risk and minimizing fraud. Company boards and CEOs are asking questions about these issues now, whereas they may not have five or six years ago. The CFO is a critical steward for implementing all of these growth strategies.

GH: How can a well-executed treasury management solution create a strategic value for the company?

GP: From the CFO or Treasurer level, cash flow is the lifeblood of an organization. The CFO must have the right cash position, accurate forecasts, and be able to measure and analyze cash flow performance and explain any variance to the CEO and board. Technology helps facilitate that analysis and adapt as needed. A treasury management solution should provide CFOs with a holistic view of not just current day cash positions, but also deliver tools and insights to provide reliable forecasts. Comprehensive treasury and risk solutions, integrated with ERP, provide the CFO with the necessary information and intelligence to not only identify and often predict market shifts, but proactively manage this volatility through timely execution of a company’s risk management program. CFOs and treasurers expect solutions that offer timely and accurate perspectives and better measurements. A comprehensive treasury management solution leads to those results.

GH: How do modern ERP solutions provide value?

GP: Growing companies often encounter similar challenges, including the onboarding and integration of new companies, as their businesses expand into new geographies and through active M&A strategies. In addition, the ability to scale operations and manage operational expenses is particularly challenging for high-growth companies. An ERP solution needs to provide the transparency required to bring those elements together. A company must be able to deploy its ERP quickly, roll it out globally, and adapt to changing business models. Having a consistent ERP makes onboarding new companies easier. As companies grow, they may need to incorporate different ERPs, legacy systems, and more. Managing multiple solutions can be difficult, expensive, and cumbersome. The scalability of a solution such as NetSuite is critical. For CFOs, the structure and synergies provided are invaluable.

GH: Treasury management used to be something only big companies did. Now mid-market companies must do so, too. What drove that change and how are modern SaaS solutions helping?

GP: As organizations grow and enter new markets, one of the many challenges a CFO faces is ensuring that the appropriate financing and ongoing liquidity structure is in place to support the growing business. This, of course, requires specific expertise. CFOs must have a heightened awareness of cash positions, investment allocation, bank counterparty exposures, and even country exposures, and they need more tools to gauge those areas of risk. While a dedicated treasury team

helps address these needs, mid-size organizations do not commonly have a dedicated treasury department; instead, they have an already overburdened accounting and finance group absorb treasury functions. With these needs becoming critical for midmarket companies with lean finance organizations, CFOs simply can’t afford to have inefficient management of the treasury function on spreadsheets. This obviously carries a considerable amount of risk—through data rekeying mistakes and errors with formulas—as well as being very time consuming and labor intensive. SaaS solutions enable mid-market organizations to manage this complex data, and transform the data into actionable information to mitigate risks and add strategic value to their organizations at a much lower cost. By leveraging best-in-class reporting and workflow tools, along with optimized dashboards, to gain realtime insight, companies today need fewer systems and staff to complete this critical function.

GH: A major concern for CFOs is fraud. How do NetSuite and a solution such as Kyriba help to mitigate fraud?

GP: Using an integrated solution enables clients to implement best practice workflows and to reconcile cash flows in a timely manner. Users can better route, process, and track payment lifecycles with greater transparency. By signing on through NetSuite and using Kyriba to synchronize efforts, you eliminate the need to login to multiple banking portals to process payments. As a result of improved payment workflow controls, standardization and synergistic efforts, customers can quickly identify and mitigate opportunities for fraud.

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