Resetting the Bar: The New Standards for Cash Management

by FEI Daily Staff

For financial executives, there’s a constant pressure to make the very best decision with your working capital on a moment-to-moment basis.

If you’re a financial executive, you know that managing the assets of any business requires a significant amount of finesse, balancing and multitasking. You’ve become well acquainted with the process of cross-referencing information in various places, comparing disparate information sources, and keeping a close eye on cash operations. This continuous shuffle of resources is required when pinning down and managing the company’s global bank balance and assets. Since accountants first started scratching their notes in ledgers, this effort to monitor financial flow has been wrought with risk – but technology may change that forever.

As the pace of business accelerates, it’s becoming nearly impossible for financial executives to match the expectations of their employers and clients. As tools like Uber, Waze, Twitter and Apple Pay dominate our world, instant service, feedback and insight becomes the new norm. With each advance in technology, the definition of “urgent” changes and condenses – yet financial decisions seem to be resisting this evolution, when they should be embracing it. Delays are becoming increasingly unreasonable for businesses that must make informed decisions at the pace of the global economy.

Financial Consolidation On A Global Scale

For financial executives, there’s a constant pressure to make the very best decision with your working capital on a moment-to-moment basis. This can be especially intense for global companies with liquid assets residing in a variety of countries. You may have several foreign accounts holding a significant portion of your assets, liabilities due (that may or may not have incentives to pay early), and stocks in foreign equities. The goal of managing and optimizing these accounts, so that you always know what your next move is, is completely achievable. What once was nearly impossible – keeping track of taxes, currency exchanges, and the various departments of your organization – is made simple through advanced technology. Closing your books within 2 business days in not a vision any more….

But how do you pick the right one?

Selecting Your Technology of Choice

When selecting the cash management software that’s right for your company, make sure to consider these questions:


When examining your accounts, be sure to note whether they are national or international, and whether local bank information is integrated into your global systems. Keep in mind factors such as preferred languages and frequency of hires (both employee and contractor) – what can be automated? Is there software that can expedite international onboarding, or perform translation services for universal forms?

Integration and Forecasting

In today’s real-time world, it’s a necessity that a treasury system is natively integrated into your existing tech ecosystem, so that decisions can be made immediately. You also must examine your forecasting cycle, and how much time it typically takes to perform a forecast. How much time would it ideally take to perform these tasks, and what parts of them can be automated or calculated to enable your teams to focus on more pressing, creative needs?

Customization Needs

Lastly, when considering software, you’ll have to take your particular business needs into consideration. If you have a high turnover rate, large and volatile inventories, or a complicated supply chain, these will all factor into your choice of technology for the financial department.

What Good Is It All?

With the right software, you’ll be able to look forward to the ability to provide forecasts on a daily basis, instead of weekly or monthly, as well as the possibility of checking company assets in real time and perform sophisticated simulations in real-time. This will be invaluable, as the financial department is increasingly consulted for business decisions (Twitter highlighted this recently by appointing Anthony Noto, CFO, as the CMO as well), which means more split second decisions with higher stakes. Further, liquidity forecasting will also be streamlined, which will offer a much more accurate view of corporate cash, especially when decisions about payables and receivables is on the table.

Work with your IT Department

Once you’ve selected the right software, make sure to consult your colleagues in the IT department. You’ll want to have the CIO on your side – it’s increasingly clear that the relationship between the CTO/CIO and the CFO can completely change the course of the business. The executives in charge of finance and technology must be a strong team – innovation breeds profit, and profit allows for investment in further innovation.

By cultivating a healthy relationship between the financial and technical departments, companies can create a united team that will ensure both accuracy and safety of all information, from both ends. A lot of modern organizations have the CFO lead the CIO.

The Endless Possibilities

It’s only a matter of time until today’s financial “standards” are seen for what they really are – out of date.  The end result of automation and technological advances in the finance department is not only greater risk management and mitigation, but more importantly, greater opportunity, as decisions can be made faster and more accurately, even based on predicted outcome. The pace of business moves too fast for finance to fall further behind. A real-time cash management and treasury strategy is not the next “best practice,” it’s just the next practice.


Henner Schliebs is vice president and head of Finance Audience Marketing at SAP.