Coupa, BELLIN and Treasury Management Systems: What CPOs and CFOs need to know about TMS and links to procurement technology (S2P, P2P, AP) [PRO]

market intelligence

Earlier today, Coupa announced its acquisition of BELLIN, a treasury management system (TMS) provider. We covered the announcement on Spend Matters.

And on Spend Matters Nexus, a subscription service that focuses on sector M&A, we provided background insight into BELLIN, treasury (as a function) and the value proposition for procurement and AP in bringing procurement and treasury systems closer together from a systems perspective.

In this Spend Matters PRO analysis, we provide an introduction to treasury management system (TMS) components, describe the rationale for a TMS (over manual or kludged processes) and describe their touch points (foundational and advanced) with procurement technology systems / process architectures — including source-to-pay, procure-to-pay and accounts payable systems.

This research brief is aimed specifically at CPOs and CFOs, as well as source-to-pay process leads/owners and treasurers.*

But before we begin, let us tease out why this move should be perceived as exciting by CFOs. To bastardize one of the most famous statements of all time, this is a small step for Coupa, and a GIANT leap for procurement technology. Think about what “business spend management” is for a minute.

What is “spend”? It’s cash flowing out the door.

So in practice, business spend management in Coupa jargon is essentially supplier cash disbursements management — ideally impacting cash before disbursement! But treasury is cash with a big C and therefore it’s spend with a capital “S.” In practice, this is Coupa’s first real foray — any vendor’s, for that matter — into broadening into “big spend management,” something we wrote about 5 years ago in fact!

Prior to making this more concrete in terms of what comprises a treasury management solution and its touchpoints with a source-to-pay (or procure-to-pay) procurement architecture, let us also keep our eyes on the prize by broadening the focus of business spend management.

If the business itself (i.e., CFO/CEO/board) is focused on return on invested capital (ROIC) and C as a proxy for cash (although in practice it’s always harder to liberate it than it is in theory), then procurement can transcend its role of just improving “R” through “spend”/savings, and take a more strategic role in bringing procurement and treasury together:

  • Freeing up cash through working capital improvement programs
  • Variabilizing costs to reduce invested capital and asset footprints
  • Reducing costs of capital and improving earnings (e.g., rebates) via innovative trade financing programs
  • Aligning spend planning and cash planning to sync up procurement and treasury with each other and the business during the FP&A process
  • Investing cash into innovative suppliers (e.g., digitally disruptive ones) rather than T-bills

OK, enough (attempting) to wax eloquent on the future of finance and procurement for now.

Let’s get down to what we’re here to introduce today: “TMS 101,” BELLIN, Coupa, the enterprise opportunity, and impact on the market.

* For vendor analysis, market and M&A-centric analysis, see our Spend Matters Nexus coverage of the deal.

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