Technology Transformation for a Best-in-Class Treasury Function
by Muriel Alvarez, Assistant Treasurer, Dana Holding Corporation
As a corporation that experienced the full force of the global economic crisis, Dana emerged from bankruptcy with a renewed focus on efficiency, control, and cash and treasury optimisation. The first step in achieving this was to review and revise cash management policies, processes and banking structures. A logical next step was then to enforce these principles through an efficient, automated treasury technology infrastructure. Furthermore, a major focus amongst senior management post-bankruptcy was to ensure timely, accurate and complete access to information. Given that Dana had over 40 ERPs in place, resulting in fragmented processes, flows and information, implementing a dedicated, specialist treasury management system (TMS) was the only way to overcome this fragmentation and achieve consistent processes and comprehensive, complete information.
- In 2012, Dana’s treasury decided to select and globally implement a new TMS as part of an overall strategy to centralise, rationalise and optimise its operations
- SunGard’s AvantGard Integrity solution was chosen, with one primary objective of achieving 100% visibility over the company’s cash in real time
- The author describes the global roll-out of the solution, region by region, which was completed in 2014
- Key objectives have been achieved and the many benefits of the new system, including automation and standardisation, are summarised
Before 2012, our global treasury teams were relying on spreadsheets and a huge number of bank portals to manage cash and treasury operations. Our accounting and bank account reconciliation processes were manual and labour-intensive, which meant that our treasury team was spending its time producing data rather than analysing and acting on it. Our financing and investment transactions were also tracked manually on spread sheets, so we lacked visibility and control. With a lack of timely, complete reporting, it was difficult to measure and monitor risk to financial counterparties.
In 2012, we received management approval to select and implement a new TMS that would be implemented globally as part of an overall strategy to centralise, rationalise and optimise our treasury operations and decision-making.
Approach to evaluation
We appointed an external consultant to support the process of selecting and acquiring a TMS. We did not have TMS experience within the treasury team, which was all new, and our IT organisation had been restructured, moving to an outsourced support model, so we needed to access specialist expertise and project management skills externally. Dana had an existing relationship with Treasury Strategies, and I had also worked successfully with them at a previous employer, so it made sense to work with them on this project. We found that working with an external consultant was very valuable during the selection process and project planning, but we found that it was easier to use internal resources later in the project to increase accountability and ensure that the right resources within the business could be deployed. Consequently, I became 100% dedicated to the project, and consulted with Treasury Strategies as required.
Appointing a vendor
We appointed SunGard as our TMS vendor and implemented the AvantGard Integrity solution. There were a variety of reasons for our decision. We were aware that SunGard was a leader in treasury technology, and we were impressed by the company’s reputation and experiences of comparable corporations that were using their systems. We also liked the fact that SunGard offered different solutions to organisations with different profiles, which meant that they were able to recommend a solution that was closely aligned to our needs. Our selection team included representatives from both US and Europe, which was challenging as we often had different priorities, but ultimately we could agree on the AvantGard solution as it supported our global requirements and specific needs in each region. AvantGard could also be integrated seamlessly with our existing risk management system in Europe, therefore providing a cohesive technology infrastructure.