The second Digital Treasury Summit began in Frankfurt on 21 March and enjoyed increasing popularity in the corporate treasury community.
The second Digital Treasury Summit began in Frankfurt on 21 March and enjoyed increasing popularity in the corporate treasury community. At the spring conference, more than 90 corporate treasury leaders gathered to discuss digitalisation solutions along with the latest trends and developments. Ten software and solution providers presented themselves in the exhibitor area, where there was lively interaction during the breaks.
The DTRS series of events inspires participants, among other reasons, for its diversity of views on treasury topics: Banking & Payments, Forecast & Analytics, Transaction & Risk, Collaboration & Connectivity, and People & Change. The pleasant atmosphere, the intensive personal interaction and the opportunity for networking also ensured that the feedback would be positive.
In his keynote remarks, Professor Dr. Matthias Schumann (Professor of Application Systems and E-Business, Georg-August-Universität Göttingen) spoke about innovations in treasury that have come about as a result of platforms, AI, big data and blockchain.
He demonstrated the current phase of innovation of each technology in terms of the expectations of market participants. It is worth pointing out that expectations are highest for deep learning (use of neural networks) while, on the other hand, some market stakeholders have grown disillusioned with blockchain.
Platform technologies already provide the necessary functions and processes in the treasury for centralisation. The prototypes of blockchain developments already in use in the treasury setting have yet to demonstrate cost-effectiveness and facilitate a breakthrough for the resulting standardisation process.
Another focus of his remarks was on use of artificial intelligence. Due to the enormous increase in computer performance and the broader data resources that this entails, BIG DATA will provide us with improved learning and training methods and will form the prerequisite for many of the approaches to artificial intelligence.
The path to the digitalised treasury is hampered by a lack of legal and regulatory framework conditions and standards. This is slowing the process of evolution in the treasury, but, despite this, it has sufficient momentum to be deemed as definitely unstoppable.
Christian Lorenz of the German Association for Human Resource Management [DGFP] offered an overview of the state of human resources management and its responses to digitalisation in the world of work. As his lecture, under the ‘People & Change’ heading, made clear, there is wide variance in the ways companies are geared towards digitalisation and, as a result, wide variance in the various answers and recommendations they provide.
This is also a topic of unabated interest to many participants and often an important point in the entire debate around digitalisation: How will/should treasury managers react? Hire nobody but ‘digital natives’ in future, if they can be found at all on the labour market, or train established and experienced employees to make them ‘digital immigrants’?
Not all employees meet the future requirements of a digitalised treasury. The different approaches adopted by individual companies are just as varied as the different employee requirements are.
Martin Mietzner of Carl Zeiss Financial Services GmbH offered an interesting insight into developments (2004 to the present) in process management in the treasury at ZEISS.
In 2004, process management was characterised by rather rudimentary documentation of processes that still could not be measured, analysed or improved.
In 2019, ZEISS Treasury presents itself as a Treasury Cockpit with zeisswiki, teamshare and analytics. From payment, account-statement processing and in-house cash, to workforce planning, liquidity, FX, interest and guarantees to financing, asset management, counterparty and credit risk, due to the fact that key process indicators can be measured, the processes involved can be controlled.
Mr Mietzner presented examples of reports in Power BI that are available as standard reports on the desktop or on other mobile devices.
Each of the attendees was able to form their own opinion as to whether this already had a revolutionary or an evolutionary character in the treasury setting.
How does SWIFT, a ‘dinosaur’ on the market, leverage its advantages of size and market penetration to launch new technologies? This is the question Sebastian Niemeyer tried to answer.
On the one hand, new technologies are giving rise to new companies with innovative solutions and services that exert enormous pressure on what are considered the ‘leaders of the pack’. On the other hand, by introducing new intelligent solutions, these ‘leaders’ can quickly reach a large community and translate the benefits into standards.
In the presenter’s view, the use of artificial intelligence will make its way into the transformation of unstructured data, e.g. address fields. This will permit prevention of malware-based fraud based on predictable usage times deriving from users’ past usage behaviour.
SWIFT sees itself as open to the community and its requirements; it takes these requirements into account by translating them into an accepted standard with the aid of the new technologies.
During the breakout sessions that followed, practical implementation solutions were again shown that have already been implemented in firms and are ready for use.
Martin Bellin introduced a new BELLIN application that exhibits the use of blockchain and can support treasury operations on the (long) path to digitalising the KYC process.
A signature card is used to simplify the administratively complicated and often inefficient process of the rules governing signatures for bank mandates. This can be a first step towards complete digitalisation in the KYC process.
Felix Baaken, a co-founder of the start-up BANKSapi GmbH, showed the development of PSD2 and presented a plug-and-play banking solution.
Whoever occupies the customer interface dominates the ecosystem. Companies are more successful if they use a strong omni-channel platform, according to Baaken.
Mr Brinkkötter of AUGUST STORCK KG and Mr Opgen-Rhein of Omikron Systemhaus GmbH & Co. KG showed what a digital banking strategy might look like.
STORCK manages its more than 300 bank accounts with more than 40 banks worldwide with the aid of Omikron's MultiCash solution, coordinating its more than 30 cash pools across different banking groups. Every day, target balancing is used to concentrate balances on a few target accounts. This gives the company transparency about its global cash flow.
The solution used is divided into the following areas: Banking Operations (Payment Factory, served through the Global EBICS channel, in the various SEPA and XML formats, cash pooling and FX settlement), Administrative Banking (digitalised relationship management, e.g. eBAM, KYC, bank fees, embargo, EMIR, MIFID) and Analytical Banking (automated sanctions screening, auditing of bank fees and FX forecast based on historical data).
The MultiCash solution has been continuously grown through addition of functionalities at STORCK and serves as a blueprint for its digital banking strategy.
In another session, Börries Többens, Senior Manager at KPMG in Germany, Finance and Treasury Management, presented a modern treasury dashboard live. The dashboard permits for highly individual reporting and meets the heightened requirements that confront today’s treasurers.
In the concluding panel discussion, host Professor Dr. Christian Debus (Partner at KPMG in Germany, Finance and Treasury Management) discussed with Jens Otto (Head of Financial Settlement, E.ON SE), Jörg Wiemer (CEO, Treasury Intelligence Solutions GmbH) and Christian Lorenz (DGFP, German Association for Human Resource Management) explored questions around the development of new technologies in corporate treasury, along with the related opportunities and obstacles.
The interesting constellation of the panel participants (treasurer of a large corporate group, system provider, personnel specialist and consultant) afforded insights into how wide-ranging views of the change processes in treasury can be.
The participants were agreed that the requirements profiles of the employees in the treasury field are changing. Some companies will identify room for manoeuvre in the area of staff reductions. The majority will increasingly detail staff to value-adding activities within the company. This calls for training measures that are as individualised as the different requirements profiles and knowledge levels of the employees involved.
The #DTRS2019 Spring Edition offered a colourful bouquet of visions and realisable solutions for corporate treasury. Each participant had an opportunity to pick the ‘flowers’ most interesting to him or her: be it new, exciting ideas for one’s own practical work, interesting conversations with fellow members of the treasury community or networking with system manufacturers. As the positive feedback shows, everyone at the event was able to find just the right thing for them. All interested parties are cordially invited to the next Digital Treasury Conference (#DTRS2019 Autumn Edition), which will be held on 22 October 2019 at Frankfurt Airport.
Source: KPMG Corporate Treasury News, Edition 90, April 2019
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