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Introduction
Imagine a world where your treasury management system (TMS) and enterprise resource planning
(ERP) system work together seamlessly, like a well-oiled machine. In this world, your treasury team
has real-time visibility into financial transactions and can make informed decisions quickly and
efficiently. The process of connecting a TMS to an ERP system may seem daunting, but it's a crucial
step in achieving a more streamlined, efficient and accurate corporate treasury operation.
Companies deploy dedicated cash management solutions to manage their cash and commercial
cashflows efficiently. They use a treasury management system (TMS) to manage financial risks or
hedging needs using financial market instruments. A TMS often contains a cash management solution
as one of its components.
Looking closer at the interface between the TMS and ERP systems, both directions (ERP to TMS and
TMS to ERP) are relevant. Here are some examples:
The ERP system publishes cashflow forecasts and payables/receivables for further
consumption and processing in the TMS.
The journal entries or the aggregated general ledger account balances from the treasury
system are provided for upload to the ERP system.
We found the following to be critical information for any organization wanting to improve how their
treasury systems connect:
Automation
Security need not be compromised
IT does not need to be involved; in fact, IT should not be building interfaces or file formats
Know your connectivity requirements and work with trusted advisors who can ensure you
make the right technology investments for your needs. Not all solutions are the same.
Below are some steps that you can consider for TMS and ERP integration in your organisation.
1. Bank Connectivity
2. Back Office Integration
3. Payments and Cash reporting
Step 2: Evaluate the integration options
Once you have identified the data and functionality that needs to be shared, it's time to evaluate the
integration options available. There are a variety of options to choose from, such as using an API,
middleware, or a pre-built integration solution. Each option has its own pros and cons, so it's
important to weigh the options and choose the one that best fits your needs.
Data mapping and data integration are also key considerations when connecting your TMS to your
ERP system. This is the process of ensuring that the data fields and structures between the two
systems match up correctly, so that data is transferred accurately. This can be a complex process, but
it's crucial for ensuring that the integration is successful.
Conclusion
In conclusion, connecting your TMS to your ERP system can be a daunting task, but it's a crucial step
in achieving a more streamlined, efficient and accurate corporate treasury operation. By identifying
the specific data and functionality that needs to be shared between the two systems, evaluating
integration options, and ensuring that data is mapped and transferred accurately, you can ensure that
the integration is successful. With the right tools, software, and support, your corporate treasury
department can successfully implement a TMS-ERP integration and enjoy the many benefits it has to
offer. So, don't wait any longer, take the first step and start reaping the rewards today.
It may not be essential for every treasury professional to have an intimate knowledge of connectivity.
After all, much of treasury’s connectivity is managed by software vendors and banks. But the more
you know about connectivity, the more you’ll be able to understand your needs in terms of bank
statements, payments, etc. You may find that you’ve been paying for services you don’t actually need,
or there are services out there that you haven’t been getting that would make your life much easier.
So take the time to educate yourself on connectivity.