Summary
June 8, 2009 – 6:37 amThe inevitability of financial change requires treasurers to be cognizant of new products, new regulations, and new opportunities to assist their organizations. Traditional U.S. cash management practice will become more electronic, and Internet-based technologies will drive the integration of accounting, treasury, sales, purchasing, and manufacturing systems. Bankers will use their scarce capital for profitable business opportunities, and will reduce their lending exposure while increasing pricing. This will force companies to call upon the skills of finance to be smarter in managing the working capital cycle. At the same time, risk management and security concerns have become critical considerations in managing company resources. The challenges and opportunities of the twenty-first century are indeed significant!
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Bill and his staff are convinced that there are many economies of scale to be realized by centralizing certain functions in the cash management area. Some of the projects they are considering include:
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A shared service center, building off the SSC that already exists for other functions in the company
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ASPs, which can provide an attractive alternative to developing in-house capabilities
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An intracompany netting system
They do not think the company is ready for further outsourcing, as there is still considerable work to be done on centralizing, then determining the core competencies. Bill is not sure that he is comfortable with having a third party provide the interface for handling customer inquiries. In preparing for his meeting with the board of directors, Bill realizes that there is a lot of work to be done to prepare the treasury for the future.
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Taken From : Essentials of Managing Corporate Cash
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