In the last post, we discussed extensively about demerits of the "Big Bang" Approach and the benefits of prioritization of needs and incremental adoption. We also looked at configurability of software products and how it enables Treasury Management Systems to meet enterprise needs and challenges of an organization, as these needs arise. Technology is what brings us a Treasury Management System. However, in many cases improper use of technology combined with unnecessary processes act a barrier to adoption - I will look at each of these in some of my future posts.
This post focusses on configurability, or the lack of it and the unfortunate but all too common need for customization of a Treasury Management System to meet an organizations needs.
Configurability essentially provides the end users of a product or managed services and support users the ability to configure the product to meet the organization specific needs. A simple example here would be Ad hoc reporting. The ability for end users to create conditional query based reports, save, share and export data. A more complex sounding example here is the ability for and end user to configure their TMS to create an appropriate output for each GL system of theirs- each having its own defined accounting treatment. The second example may sound complex, and in most cases extensive customization of the TMS is required to achieve it.
Another example could be a organization that is in transition- say from a decentralized payment approvals model to a centralized payment approvals model or vice versa. Most TMS out there would require considerable time and effort to accomplish such a task and consequently most organizations wait till they have accomplished the transition and then consider adopting a TMS Payment module.
Now, let us not confuse customization with configurability- customization requires a product implementation consultant to create multiple reports for you or to write new code such that the TMS can integrate with each GL system or accommodate your specific payment approval processes. In other words, configurability acts as an enabler, enabling an organizations need for change. Need for customization reduces the ability of an organization to meet with changes, without considerable investment in time and effort and thus in cost. Customization acts as a deterrent to Treasury Management Adoption, and rightly so.
Let is first look at how configurability is achieved and why most systems fall short and need extensive customization. Most of the large TMS our there are a conglomeration of multiple products - well in most cases a conglomeration of products from multiple independent companies that were bought by a parent company and somehow sold as one product. Seamless integration of these products is in simple terms very difficult and requires time and resources; which unfortunately is challenging even for the largest of the TMS vendors out there. Hooks are built in at multiple places within each product so they can talk to each other. The problem with this is that any change or configurability of one product will affect the very functioning of the other products that are connected to it. These products were never meant to be working together. End result is that end user configurability options are not provided by the vendor and custom configuration for a customer is expensive. A possible solution to the problem mentioned above is to pick products that are built from the ground-up. Configurable products that use the latest stable technology and utilize standards where available.
Ultimately, lack of configurability and the need for extensive customization,both upfront and as and when an organization's needs change result in additional time and resources, impacting the ROI for TMS adversely. If you have not adopted a TMS so far or have limited adoption, chances are that you agree with and understand some of the challenges that I have described above. If you have implemented a solution and agree or disagree with the post, please let me know your thoughts. I will continue this thread on subsequent posts, meanwhile please feel free to post a comment on what your thoughts may be.