The Future of Corporate Treasury

11 The Future of Corporate Treasury SAP and Oracle (“ERP vendors”) continue to dominate the ERP market • At this moment SAP owns over 50% of the enterprise resource planning (ERP) system market, while Oracle (incl. JDE and Peoplesoft) has around 25% of market share. The rest of the ERP market is shared among smaller participants. Especially larger multinational corporates (over 10 billion euros in revenue) tend to use SAP or Oracle as their main ERP system. • A significant part of those companies that are using SAP as their main ERP system, have also been implementing the treasury functionality of SAP, which includes cash & liquidity management, treasury & risk management, in-house banking and bank connectivity. With these clients SAP currently owns around 20% of the TMS market. In contrary, Oracle currently has a very limited share in this market. • In the coming years ERP systems are expected to further develop real-time information, data analytics and integrated solutions to support the entire financial supply chain for treasury, risk and finance. New functionality will mostly be developed in the cloud, with examples such as SAP S/4HANA and Oracle E-Business Suite Cloud. Future add-ons and apps are focused to improve user experience via virtual assistants or third-party integration via SAP App Center or Oracle Market Place. “We see the future of enterprise software moving into the direction of becoming the intelligent enterprise. What does that mean? Intelligent enterprises effectively use their data assets to achieve their desired outcomes faster — and with less risk.” “As part of SAP’s standard road map, intelligence is embedded into our solutions — so customers can make sense of their data in context and optimize via self-learning algorithms.” “We do see clients preparing their system landscape into a digital platform, ideally consolidating lots of data into an integrated system. That can help to unlock new potential in the daily processes, being it transparency and real- time information, automation, improving security standards and getting rid of legacy systems or even predicting the future.” Christian Mnich Senior Director Solution Management Treasury, SAP • Best-of-breed treasury management systems (TMS), such as FIS and ION, have acquired several smaller technology vendors over the last decade and currently together have approximately around 37% market share. With their broad product portfolios covering treasury, risk and payments, both vendors cover the full range from entry-level to high- end solutions. • While during our interviews none of these technology vendors made any of their intentions clear, in our opinion continuing to support and develop their extensive range of products will be costly. At one point, we expect there might be a rationalization effort in their product suite where clients are encouraged to a core product or platform. • In addition to the two Big Players, various specialized niche vendors such as Serrala (formerly known as Hanse Orga), Kyriba, GTreasury, which recently acquired Visual Risk. BELLIN, Salmon, Trinity, Diapason, TreasuryXpress, and Orbit have been acquiring approximately 36% combined market share and are challenging the established larger market players. Due to the lack of restrictions from older products, they can usually be more agile and flexible to adjust to changing market conditions and new regulations. FIS and ION (“Big Players”) continue to dominate the best-of- breed TMS market, with eight to ten specialized niche players (“Independents”) being their main challengers.