The gift of plug and play technology

Des Twort is EMEA treasury specialist at Bank of America Merrill Lynch

We’re fast approaching that time of year when in many cultures, it is customary to give and receive gifts. People around the world are searching shops and browsing online for the right presents, choosing between the shiniest new gadgets, more traditional toys, games and gift cards, writes Des Twort.

Smartphones have been amongst the most popular presents in recent times. They offer a wide range of functions, and each upgrade brings faster processing power, more connectivity and access to a wider range of applications. Yet many people rarely use all of their phone’s capabilities. A proportion of users will only ever need to be able to make phone calls, set an alarm and perhaps check their train times whilst on the go.

There is a similar situation in treasury. The technology that banks offer clients can be thought of as a true gift, enabling improvements that can reduce risk, increase efficiency and ultimately put firms on a surer footing. And it is the most advanced and newest platforms which grab everyone’s attention. Millions of dollars have been invested in banking systems over the last decade, enabling corporate clients to automate their banking channels for transaction processes and information reporting.

Investing in an all-singing, all-dancing enterprise platform however does not come cheap and can take years to implement. If it’s what the client needs and if implementation is of a high quality, the company will reap dividends from the benefits automation can deliver. But not every client will make enough use of holistic, full-function platforms to warrant this investment of time and money. Some industries, such as retailers, operate on thin margins and have to work hard to justify extra expenditure and investment, especially at a time of economic uncertainty.

Ultimately not every client needs the newest package on the market, or the latest system with all the bells and whistles. Banks may have off-the-shelf products already developed which could meet their needs in a cheaper and more efficient way.

Many of these ‘plug and play’ banking solutions have been underutilised in the past. Typically they were first developed to meet a specific client or market need. Corporates may want to discuss with their banking partners whether any existing products could provide a solution to their cash management needs, or whether the treasury tools they use already could be adapted and tailored to better suit how they operate. Additionally, most banks have specialists to advise and train clients to have a better understanding of their products, which can help make sure users get the best mileage out of those tools.

So how should banks start a conversation with their clients about this? A good place to begin is to identify any repetitive manual processes that are time consuming or resource intensive. Look for processes driven by retyping of data, data matching with a highlighter pen and printing of reports. These might be tracking down company cash, reconciling bank statements, accounts payable to vendors, managing overhead expenses and anywhere there is a duplication of activities in a company.

Standalone products that address any of these individual areas could be highly valuable to that business over the long term. Some of the typical solutions waiting there to be rediscovered may include secure and simplified payment file delivery solutions, customised and consolidated account statement balances, transaction reporting and intercompany loan tracking products.

Banks do recognise the varying technology needs of their clients, and the differences between those who require fully integrated data feed solutions versus those who do not. But it is imperative to listen to clients all year round, not just at RFP time, and consider whether there are products that have already been developed which could make a true difference to them. Looking at what’s on the shelf and already in the store-cupboard may help your clients cut costs and benefit your relationship with them at the same time.

One of the most enduring images of Christmas in the English language is from Dickens’ A Christmas Carol, where Bob Cratchit toils away at his desk for his master Ebenezer Scrooge. Buried beneath piles of paper reports stacked up to the ceiling, he works hard but inefficiently and each day brings more of the same manual and repetitive work. This is a good time of year to consider how many Bob Cratchits are there in your clients’ organisations, for whom relatively modest but smarter tools would be a true gift to them and their companies.