Technology supports people in making treasury processes work and has a direct influence on what levels of efficiency can be achieved.
When looking for the best IT system, treasurers often face the agony of choice; they can choose between treasury functionality in the ERP system, specialized ERP add-ons, independent treasury tools, cloud-based solutions, software-as-a-service and more.
This great range of solution options often leads to confusion amongst those who have to decide on the right software for the company.
The wide range of finance software that is available today has created some misunderstandings in the corporate world: quite often, for example, cloud software is equated with subscription models and ERP software is considered as the on premise solution that requires an upfront investment.
What treasurers need to understand is that the way a software solution is bought – via subscription or via capital investment – does not say anything about the technology of the software solution. What is really important when choosing the right software is to be clear about the how of the technology delivery and whether the selected model is compliant with the overall IT corporate strategies and policies of your company.
The main technical delivery options today include:
So, the question treasurers need to look at in the first place is whether they prefer the software to be installed on their premises or whether they have the trust that their financial data can be safely maintained in the cloud. The pricing issue is only secondary.
As mentioned before, the way customers acquire software is not limited to a particular form of technical delivery. Both on premise and cloud solutions can be either bought (licensed software or CAPEX model) or rented (subscription software or OPEX model). In contrast to the technical delivery the pricing model is a matter of a negotiation between two parties, the vendor and the customer. So, the customer may not be able to influence the technical delivery of a software solution, but he may well have a say when it comes to how he has to pay for it.
It is therefore important to thoroughly compare the costs and risks involved in each of the models.
Financial data flows are the lifeblood of a business. They are a precious commodity that companies need to look after well. If financial flows arrive too late, are inaccurate or corrupted or if they do not arrive at all at where they should be, this is a major threat to the business of every company! This is why companies have to look very carefully at what type of technology they need and what is right for their individual business. Whereas one company may fare better with a cloud solution, another may profit more from an on premise solution. In fact, there is no “one size fits all” in terms of financial software. It really depends on what the customer wants and needs to succeed in his business. The answer to our initial question “Cloud vs on premise – which is best suited to ensure efficient treasury processes?” has to be a clear “it depends”!
This is a summary of our Whitepaper. For more Information please download it here: "Cloud vs On Premise: Which is Best Suited to Ensure Efficient Treasury Processes?"