STX Group is an environmental commodity trading firm based in Amsterdam. It is a leader in environmental commodities and provides market access and liquidity in both liquid and illiquid commodities such as renewable energy, biofuels, energy efficiency and carbon markets.

When embarking on the project to update the firm’s treasury systems, Khorev says he was cognisant of the challenges that commonly arise during such implementations including timeline (the most difficult to manage given that most IT projects overrun their original schedule), user adoption of the system and budget control in terms of both direct – as a result of scope creep – and hidden costs such as integration with other systems or hiring interim treasury specialists to allow the rest of the team to focus on implementation.

“Mitigation strategies included focusing on the pre-implementation phase in terms of scoping and vendor selection,” he says. “It is important not to treat the treasury management system as a stand-alone system but rather consider its position in the overall IT infrastructure of the company and its relationship with other systems such as ERP or FX dealing platforms.”

Proper project organisation – especially resource planning – is another key mitigation strategy. Khorev suggests starting with external resource management by requesting and reviewing the CVs of the vendor project team and include in the contract minimum weekly capacity on their side.

“Internal resource management is also important,” he says. “It may be advisable to hire interim support so that one of your team members can focus entirely on TMS implementation. Additional factors that contribute to successful implementation include engagement of stakeholders at all levels, especially end business users and not only from treasury but also from accounts payable and accounting.”

Khorev recommends investing in training and building in-house knowledge, not only to improve understanding of the system from an end user perspective but also to enhance understanding of how it can be configured.

“For that purpose, it is also important that the project is mostly driven internally and that the core of the project team consists of representatives of the company,” he says.

When evaluating system vendors most treasurers know the majority of systems provide similar functionality. However, the devil is in the detail and it is important to look at what types of bank connectivity are supported, how different bank formats are processed, and how flexible and convenient the reporting engine is.

According to Khorev it is also important to perform a proper fit-gap analysis.

“In the end, your functional requirements will identify the most important features to have in the system and it is advisable to prepare business case scenarios and request participating vendors to run such examples in the system during demo sessions,” he says. “Another way to gain system insights is to request a reference call and review the lessons learned during peer meetings.”

He offers the following checklist of the most important elements of the business case for TMS implementation:

• Automation of manual processes.

• Ability to shift the focus from manual operations to strategic and analytical activities after TMS implementation.

• Replacing Excel spreadsheets with integral data.

• Reducing operational risks and risk of fraud.

• Increasing cash visibility and thus minimising cost of idle cash.