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In this 1 hour webinar, the speaker panel discussed the best practices corporate treasury teams use to justify the investment in treasury technology.
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© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 1
Tim JohnsonDirector of FinanceGarmin International, Inc.
Dory MaloufTreasury Cash Operations ManagerPulteGroup, Inc.
Bob StarkVice President, StrategyKyriba [email protected]
Introductions
Today’s PresentersTim joined Garmin International as Assistant Treasurer on Halloween, 2005. Tim’s responsibilities at Garmin include global risk management, treasury management, and overseeing U.S. and global income tax concerns. Tim implemented Kyriba in 2011. Tim graduated from the University of Kansas with a Bachelors degree in Accounting and Business Administration and is a CPA. Previous positions include working at a public accounting firm, working as an Accounting Manager and Controller at companies in the K.C. area.
Dory Malouf is a Treasury Cash Operations Manager at Pulte Group Inc. with a professionally recognized career. His team’s accomplishments in treasury technology and process improvement have been featured multiple times in Treasury and Risk Magazine and various AFP periodicals and books. Dory has a proven track record in adding value to an organization through process improvement and treasury technology.
Bob Stark is responsible for global product strategy and market development at Kyriba. Bob is a 15-year veteran in the treasury technology industry having served in multiple roles at Wall Street Systems, Thomson Reuters, and Selkirk Financial Technologies including product management and strategy. Bob is a regular guest speaker at treasury conferences and an active member of the Association for Financial Professionals.
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 2
1) Today’s environment: what types of business cases?
2) Where are the benefits?• Productivity• Financial Controls• Visibility• More effective financial decisions
3) Focus: PulteGroup
4) Focus: Garmin International
5) Summary
Agenda
Topics for discussion
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 3
What is the main reason for not implementing new treasury technology?
a) We already have a TMS
b) Excel is the perfect solution
c) Unclear on ROI
d) On the path to building a business case
e) Asked, but was turned down
Audience Question
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 4
Today’s environment
• Building a business case can be formal or informal
• Executive approval almost always needed
• Budget isn’t just “handed out” Even if informal, justification often has to be
presented (the “office suite” of applications)
• Justification often involves a mix of quantitative and qualitative benefits
Building a Business Case
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 5
Productivity
Financial controls
Global visibility
Effective financial decisions
Value Creation Hierarchy
Single point of data entry• Eliminate re-keying errors• Improve accuracy and
confidence in analysis
Automate repetitive tasks• Shift time from processing to
analyzing• Achieve results more quickly
Streamline reporting• Automate and schedule
preparation and distribution
Treasury as a strategic partner
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 6
Productivity
Financial controls
Global visibility
Effective financial decisions
Value Creation Hierarchy
ExamplesStreamlining of payments process- 50 hours / month (25% )
Consolidating Cash Forecast- 80 hours / month (50% )
Automating GL Entries- 4 hours / day (50% )
Multi-bank reporting- 2 hours / day (25% )
Treasury as a strategic partner
Productivity =X Annual FTE Cost
Hours saved8 Hours per day
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 7
Improve data integrity• Eliminate reliance on ‘super’
spreadsheets• Standardize processes and
procedures
Controlled workflow• Separation of duties• Reduce SOX audit costs
Centralized audit trails• Improve visibility and
transparency• Better control of workflowProductivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partner
Value Creation Hierarchy
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 8
Productivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partner
Value Creation Hierarchy
ExamplesNot as easy to quantify!!
Reduce SOX Audit Costs- 50% reduction in time taken
Reduced likelihood of fraud- Cost of fraudulent payment or
bank account- Previous % of event occurring
Reduced likelihood of errors- Cost of error (e.g. broken
formulae, ‘extra’ zero, duplicate payment)
- Previous % of event occurring
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 9
Productivity
Financial controls
Global visibility
Effective financial decisions
Cash • Bank reporting• Cash positioning• Forecasting• Liquidity
Financial positions• Investment• Debt• Intercompany • Foreign exchange
Exposures• Foreign exchange• Interest rate• Counterparty• Supply chain
Treasury as a strategic partner
Value Creation Hierarchy
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 10
Productivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partner
Value Creation Hierarchy
Examples
Value of visibility is generally in the decisions it enables
Bank Account Optimization- Visibility into bank accounts- Visibility into bank fees- Visibility into bank reporting= cost/benefit of bank accounts
Identifying idle pockets of cash- Visibility into bank reporting- Can find balances didn’t know
you had (or balances higher than realized)
- More likely for decentralized
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 11
Productivity
Financial controls
Global visibility
Effective financial decisions
Excess cash and liquidity• Strategic investing• Debt repayment• Supplier discounts
Treasury movement/analysis• Bank Fee Analysis• Search for liquidity• Netting• Optimal funding/drawdown
(i.e. international)
Risk Management• Better hedging• Trading diversification
Treasury as a strategic partner
Value Creation Hierarchy
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 12
Productivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partner
Value Creation Hierarchy
Examples
Liquidity Optimization- Higher rate of return- More ‘freed liquidity’ to
invest/apply- Or Both
Hedging- CF Hedging: protection easy
to quantify ($100M hedged X 1% volatility avoided = $1M)
- Can calculate historically or proactively (off curve)
Analysis- Bank Fees easy example
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 13
Productivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partnerBuild value through collaborative business partnerships Intelligence Insight Analysis
Examples• Shared service model• Forecasting economic change• Sales enablement• M&A analysis• Market expansion• Business Intelligence
Value Creation Hierarchy
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 14
What is your biggest difficulty in creating a business case?
a) Understanding our own needs
b) Aligning benefits to costs (e.g. creating ROI)
c) Seeing ‘more than just productivity’ benefits
d) Putting it all together into an actual document and presentation
e) No difficulties; we’ve got it covered
Audience Question
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 15
Focus: PulteGroup
PulteGroup has implemented three treasury management systems over the years, and had a fourth system available as a result of a corporate acquisition
Key Questions
1) What are the drivers to continually update treasury solutions?
2) Is this specific to TMS’ or is this something Pulte does across all technology?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 16
Focus: PulteGroup
Pulte’s latest treasury management solution is cloud-based, delivered using a Software-as-a-Service model
Key Questions
1) How important is cloud technology for Pulte?
2) How do cloud solutions help the business case?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 17
Focus: PulteGroup
Treasury systems offer productivity, improved controls, visibility, and enable better financial decisions
Key Questions
1) What was relevant to justifying the investment in a TMS for Pulte?
2) Did you have to make a formal business case each time?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 18
Focus: Garmin International
PulteGroup treasury seems themselves as a strategic partner to the business and has taken on many responsibilities outside “typical” cash and treasury management
Key Questions
1) What do you mean as a “strategic partner”?
2) How did you get there?
3) Does that help the justification for a TMS?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 19
Focus: Garmin International
Since Tim joined in 2005, Garmin has achieved substantial growth, expanding from 3 countries to 35 countries with almost 60 legal entities
Key Questions
1) At what point was treasury technology seen as a necessity?
2) What were your original objectives before selecting a TMS?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 20
Focus: Garmin International
After reaching the tipping point, Garmin initiated a vendor selection process to find a treasury management system to meet global needs
Key Questions
1) Why was a TMS decided upon?• What were the other options?
2) What type of solution (e.g. Excel) did you come from?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 21
Focus: Garmin International
Garmin had to justify the expense and time spent to select and implement a treasury management system
Key Questions
1) How did you create a business case?
2) Who was involved?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 22
Focus: Garmin International
Garmin had to justify the expense and time spent to select and implement a treasury management system
Key Questions
3) What was relevant to justifying the investment in a TMS?• Productivity?• Visibility?• Controls?• Better Financial Decisions?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 23
Focus: Garmin International
Technology projects are always approved by someone. Anticipating why they think this is important is key to a smooth ‘green light’.
Key Questions
1) Who approved the business case?
2) Why was it important to them?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 24
Focus: Garmin International
Garmin has successfully implemented a TMS and deployed domestically and internationally
Key Questions
1) Are you seeing the visibility you expected?
2) What else have you been able to achieve?
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 25
Summary
Productivity is importantOften focused on time savingsCalculate based on cost of FTE
Rarely is the FTE replaced!
Qualitative Benefits also goodEffective financial controls
Establish best practicesBecoming strategic partner
Effective Financial DecisionsVisibility enables better decisions
Generates game-changing ROI
Garmin InternationalVisibility justified project
Allowed other critical process improvements
PulteGroupInnovation delivers business valueEfficiency enables strategic input
© 2013 Kyriba Corporation. All rights reserved. PRIVILEGED & CONFIDENTIAL. 26
Questions?
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