Today’s corporate treasury is being challenged in unprecedented ways. Complex factors, such as global growth, changing regulations, and advancements in technology are impacting treasury management, putting increased pressure on organizations to ‘do more with less.’ At the same time, the role of the treasurer has expanded to meet the evolving responsibilities of funding and raising liquidity, understanding and managing risks, and supporting business units as successfully as possible. In order to effectively navigate this dynamic landscape, corporate treasurers must leverage meaningful intelligence to improve performance and enhance results.
Benchmarking has become an invaluable means for treasury to gain an objective perspective of the current state of operations relative to similar companies and in absolute terms of liquidity and risk. However, effective benchmarking isn't simply about comparing a handful of functions and companies - it should provide a 360 degree treasury perspective, offering a broad baseline and insights into best practices across all dimensions of treasury management. While benchmarking practices have continually evolved over the years, the ways in which it can create value for a firm have remained constant. Typically, organizations will leverage benchmarking for one or more of the following reasons:
(1) improving productivity;
(2) setting effective goals; and
(3) driving continual improvement.