Averda, a provider of waste management solutions, chose a cloud treasury management system (TMS) – Kyriba – because it has the functionality and flexibility to support its ambitious growth plans and the remote locations of its offices.
Microsoft Treasury sings the praises of cloud analytics (Power BI) because of how easily the team can use it to combine data from multiple sources, analyse and visualise information, and share insights.
The Private Export Funding Corporation integrated its enterprise resource planning (ERP) system (Oracle Financials Cloud) and treasury risk management system (Reval), so that its treasury team could automate more manual tasks and save time, improve control and reduce risk.
There are many reasons why treasurers choose to use cloud-based resources and the benefits are growing along with the variety, utility and interoperability of the specialist software and services available.
Bank of America Merrill Lynch provides mobile access to treasury services through its CashPro online banking platform. Encompass offers a Know Your Customer solution that automates the repetitive activity of accessing, retrieving and analysing data from multiple sources.
Fluidly provides automated ‘intelligent’ cash-flow forecasting and credit control. Mitigram offers an online platform for funding and hedging trade risk, connecting corporates and banks via a browser.
Some treasury departments are responsible for their own systems and data.
As digital technologies proliferate and create new possibilities, more treasurers will be involved in decision-making around technology strategy, providers, products or services – and cloud is a factor.
The cloud is actually a collection of technologies used to provide ‘as a service’ access to ‘shared’ resources
Very few treasurers need to become technology experts, but if you want to get the most from such systems, it helps to have a basic grasp of the technologies and terms of reference that you will come across, because not all clouds are created equal.
To start with, there is more than one cloud-delivery model: there are public clouds, private clouds and hybrid clouds (see ‘Own the risk’, below), and each of these contains variations on the theme.
Even ‘the cloud’ (as we all call it) is a misnomer.
It’s not a single thing in a single place. The cloud is actually a collection of technologies that are used to provide ‘as a service’ access to ‘shared’ resources, such as software applications, data storage and computing infrastructure.
This access usually takes place ‘on demand’ from anywhere with an internet connection, using fixed and mobile devices.
Cloud computing is an umbrella term that encompasses all of this, and it is made possible by ‘virtualisation’.
Without this, there would be no cloud.
In the world of technology, everyday words can acquire new meaning; but virtualisation simply describes the creation of ‘virtual’ rather than ‘actual’ versions of something. It is complex in design and execution, but treasurers don’t need to understand the bits and bytes.
It’s enough to know that virtualisation allows computing resources to operate more efficiently and cost-effectively, because it overcomes the physical constraints of things like servers (hardware for storing, securing, accessing and managing data and services) and operating systems (that manage hardware and other software).
Virtualisation is one of the elements that enables the entire (public, private and hybrid) cloud ecosystem; because the manipulation of hardware and other resources made possible by virtualisation are used to deliver shared resources ‘as a service’.
Hence, software as a service (SaaS), infrastructure as a service (IaaS) and platform as a service (PaaS), which manifest as cloud software applications (such as Google Maps and WhatsApp); data storage (such as Apple’s iCloud and Dropbox); and computing infrastructure (such as Amazon Web Services (AWS) and IBM Cloud Services).
You may be more familiar with Google Maps than AWS, but all treasurers benefit from such services because they are used by many other cloud services.
Your cloud ERP system may rely on AWS. When you store photos in iCloud, Apple uses AWS servers and storage; so do Airbnb and Netflix – a good example of what techies mean when they describe cloud services as ‘dynamic’ and ‘scalable’.
As viewer numbers fluctuate, Netflix meets streaming demands by dynamically scaling up or down and switching on or off the AWS servers and storage.
All of the very many cloud software and services out there are interdependent – which brings us to application programming interfaces (APIs).
They glue software and services together by enabling the ‘connectivity’ that makes data and functionality in one system available to another system, often (though not always) without the support of integration specialists.
Some APIs are open (or publicly available) and some are private – and you can learn more about the benefits of the former, and what they can mean for treasurers, by reading our recent coverage on open banking.
Being armed with a little knowledge on the technologies that underpin the cloud can help treasurers to better exploit the potential benefits, avoid the potential burdens and make more informed decisions.
For example, awareness of how interconnected cloud resources are highlights the complexity and importance of thoroughly assessing and ensuring compliance with legislation such as the General Data Protection Regulation and security standards like SOC 2.
Treasurers have always been aware of the significance (and risk factors) associated with physical and financial supply chains; understanding the cloud supply chain can help to complete the picture – now and in the future.
Here is a quick guide to the three, main cloud deployment and delivery models:
PRIVATE CLOUD most closely mirrors traditional ‘on-premise’ systems (that live on a box in your office or data centre), as this set-up allows businesses to retain dedicated hardware and software. This can be operated on or off your business’s premises, using hardware and software it owns/leases/rents, or using hardware and/or software that is owned/leased/rented by a managed services provider. Either way, these resources are generally (but not always) used by a single ‘tenant’ – your business.
PUBLIC CLOUD is the set-up that most of us are most familiar with, because of the many public cloud services we use privately (if not professionally). These are always multi-tenant services and pretty much everything about them is shared: from the hardware (such as virtual servers) to the software (operating systems and applications). Data belonging to different users sits side by side and may be located on servers belonging to your service provider or another third party.
HYBRID CLOUD allows businesses to combine the flexibility of cloud services with the comfort of knowing that sensitive data is being taken care of within your own four walls. This approach can enable businesses (and their treasury functions) to, for example, retain their investment in a traditional on-premise ERP system, while taking advantage of selected cloud applications, by integrating the separate systems and different delivery models.
It’s important to understand the differences, not least because some software vendors support public, private and hybrid cloud deployments.
The decisions you make on this have implications for access; application and data security; where and how your data will be stored and managed; how it is encrypted; and whether this happens just when it is ‘at rest’ or also when it is in transit; and more.
Lesley Meall is a freelance journalist specialising in technology and finance
This article was taken from the Cash Management Edition 2019 issue of The Treasurer magazine. For more great insights, log in to view the full issue or sign up for eAffiliate membership