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Automate to Innovate: How Technology is Reshaping Treasury

  • By Andrew Deichler
  • Published: 6/2/2015

CHICAGO -- As treasurers’ responsibilities continue to grow, they need the best technology available just to stay ahead. Last week during the opening general session of the CTC Corporate Treasurers Forum, practitioners provided insights into how their functions have undergone a rapid evolution in recent years.

Matthew Skurbe, treasurer and managing director of Blackstone, noted that there isn’t a system his firm currently uses that was in place in 2007. “Everything has been upgraded—our ERP system, our HR systems, and certainly our treasury systems,” he said.

Automate and integrate

Soon after Skurbe joined Blackstone in 2009, he realized that treasury’s systems needed an overhaul. “We had about 1,600 bank accounts when I walked in the door, all managed on bank portals in a very decentralized fashion,” Skurbe said. “We didn’t really have a great fund ledger at the time; we were in the process of replacing our fund ledger. It was clear that we needed a better system, with more automation and more integration with the rest of the firm.”

Skurbe’s team adopted Wallstreet Suite and implemented an in-house bank that was plugged into Blackstone’s ERP system. “We put the treasury system in first, and then started focusing on procurement and payables. We had a central payment service with a lot of manual processes; we had to get all the receivables and payments worked out. We’re now adding the new payables process across over 3,000 entities—a central paying agent with the treasury entity essentially in a large collection effort.”

Skurbe concluded by saying that while his treasury organization has come very far since 2009, he knows they still have a long way to go. “It’s definitely a journey; you keep working at it, and you keep improving,” he said.

2013 Pinnacle Award Finalist Brad Vollmer, treasurer for medical therapy provider Gilead Sciences, explained that his treasury department has also gone through a process of automation. The firm has undergone rapid growth; when Vollmer joined five years ago, it had a market capitalization of about $30 billion—today, it is at $165 billion.

“When I got there, everything was done on a spreadsheet,” Vollmer said. “A lot of manual entry of data, prone to error. And when you’re in a science culture where 80 percent doesn’t work, you have to be perfect all the time. So we worked on a major technology automation project. It took about two years, and through those two years we put a lot of time and thought into how we were going to do it.”

Vollmer stressed that this project was not about installing systems; the goal was to automate and take work out of the system. “If you remove manual entry, you make jobs more interesting for your analysts. So that’s why we called it an automation project, not a treasury workstation implementation,” he said.

But as for the treasury integration software itself, Gilead set out to implement software that was designed for treasurers by treasurers. “A lot of software is out there is written by people who haven’t ever been in treasury. That’s scary,” he said. “So we found a guy at a software company who had actually been in treasury. He spoke, what I would call, IT speak or treasury speak. So we used him and it all plugs and plays really nicely together. You can do things really fast if you put a lot of thought into it up front.”

Major money moves

Kristin Walle, CTP, vice president, global money movement and compliance for payroll giant ADP Inc., is responsible for moving between $5 billion and $20 billion per day. Her role differs from that of a treasurer because she looks at all of the automation related to the client money movement functionality. “I’m not looking at accounts payable or accounts receivable, but there’s quite a bit of data that I’m responsible for, as far as the integration with our financial institutions and the integration of all of our clients and the platforms that we use,” she said.

Walle’s function has changed recently, but two years ago, she was head of global money movement compliance, which entailed centralizing independent money movement functions around the world. “We have two main platforms; we have an SAP platform in the U.S. and an Oracle-based platform for international, and then we have home-grown systems that support other business units,” she said. “What we’ve been looking at is how we migrate one or two key platforms so that from a risk perspective, we understand where we are disbursing funds to. We’re looking at those components and making sure that we make the best risk-based decisions on what funds we’re choosing to outflow.”

Walle is also responsible for all of ADP’s government agency relations around the globe. “These are the government bodies that we pay payroll tax related items to,” she said. “The United States is very cumbersome, because it’s about 2,000. So we’re working on automating the information that our clients provide us from their employees to the taxing agencies to make sure we’re paying appropriately there. We have a huge data exchange that we’re working on for the various agencies.”

Walle agreed with Skurbe that the process of automation and system improvement is a “continuous journey.” She likened the process to being at basecamp on Mt. Everest. “We’re lucky we got to camp one, but we’ve got a heck of a long way to go,” she said.

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