Developing A Leading Edge Treasury System
by Belinda Davis, Treasury Systems Business Manager, TUI Travel PLC
As a diversified travel group serving some 30 million customers and operating in 180 countries, our everyday business activities create major operational complexities associated with cash management, not to mention significant currency and commodity (jet-fuel) exposures. Therefore, one of the key responsibilities for Treasury is to manage these risks effectively — in order to safeguard TUI Travel’s financial performance.
In 2007, TUI Travel was born from the merger of TUI Tourism and First Choice Holidays PLC. Post-merger, our initial review of systems confirmed that the combined entity included a variety of treasury system business tools and interfaces with no straightforward way to achieve a holistic view of our overall treasury operations. A fundamental problem that we faced was a lack of linkage between each of the legacy treasury management systems (TMSs).
With no communication between the two legacy TMSs, the management reporting process became a relatively manual process based on outputs from both systems. Position reports, exposure calculations and transactions management were more cumbersome than they needed to be. Meanwhile, the merger meant that our treasury group was now managing much larger and more complex currency and jet fuel exposures.
Identifying the right system
In 2008, we began the request for proposal (RFP) process. Our goal was to identify and then implement a fully integrated TMS. In addition to solving our problem of having two separate legacy systems, we realised that with a leading-edge system in place, we could streamline our processes, improve efficiency and transform the treasury function into an enabler for business integration and growth for the newly formed company.
Once we had produced a thorough RFP, we sent it to a shortlist of vendors that included the traditional corporate treasury system vendors as well as those with a recognised strength in financial and commodity risk management.
OpenLink was able to offer a truly integrated system that could include all of the required functionality and asset classes we needed — thus meeting one of our key objectives.
OpenLink was also able to demonstrate that its cash management and other core treasury functionalities were strong in comparison with the rival products considered.
The final step in our selection process involved visiting reference sites with OpenLink to further validate our assessment of the Findur product and to highlight any unforeseen product/vendor risks or issues. Ultimately, we decided that OpenLink was the right partner for us. Its Findur product satisfied our key criteria, namely:
- Single database with multi-site access
- Cash position (including cash pools) management functionality
- Intuitive deal processing and exposure monitoring with flexible reporting
- Full SWIFT message processing capability
- Standard interfacing to other internal TMS tools