Top 3 Ways to Strengthen Your Cash Flow Forecasting and Strategic Planning

Written by Keegan Chamberlin
April 21, 2022

As we discussed last week in Bank APIs: Top 5 Best Practices for Enriching Your Cash Data, treasurers are struggling to gain insights from their bank data that drive better, more informed decisions. And while access to bank data is still a challenge, there’s still many other limitations treasurers face that prevents them from gaining stronger insights from their cash flow forecasting:


Top 3 Limitations Treasurers Face That Prevent Them From Gaining Stronger Insights From Cash Flow Forecasting:

  1. Lack of Proper Technology and Tools
  2. Limited Time and Team Resources
  3. IT Support


Download the Essential Treasury Reporting and Forecasting Guide

Cash Flow Forecast Limitation #1: Lack of Proper Technology and Tools

According to The Global Treasurer’s Asset Bench Mark Research 2019 Treasury Review Survey, only 32% of treasurers are still primarily relying on Excel spreadsheets to manage their treasury operations, and only 10% believed that their day-to-day finance processes have been 90% digitized.

If you are in this group still using spreadsheets for cash flow forecasting, you could be losing out on valuable insights from your balance and transaction data, since every time you must create a baseline forecast or perform scenario planning, your dataset must be reset. This can lead to scouring your multiple bank portals, downloading CSV files, and spending a multitude of hours normalizing this data when this precious time could be spent performing strategic analysis and discovering those critical cash insights.


Cash Flow Forecast Limitation #2: Limited Time and Team Resources

As your business scales, your balance and transaction data can exponentially increase to the point where all you have time for is to create a weekly or monthly cash forecast. Losing out on time and team resources for data management leads to having less time to analyze the effectiveness of your cash management strategy and to making less effective decisions. 

According to Clive Humby, the famous British Mathematician, “Data is the New Oil. Data is just like crude. It’s valuable, but if it’s unrefined, it really cannot be used.” Your technology and tools should provide you with more time to perform essential treasury tasks and transform your data into powerful insights instead of being a bottleneck to analysis.


Cash Flow Forecast Limitation #3: IT Support

When managing your cash reporting and forecasting in spreadsheets or legacy TMS, whenever you want to view your data in new ways, it requires a lot of IT support as your IT needs to ensure that your data is consistent, available, and resilient within every one of your reports. Any custom reporting likely takes weeks to build and often treasurers are uncertain whether the data source is accurate and up-to-date.

The bottom line is that if your current treasury tech stack is requiring you to perform arduous manual labor to discover key insights, it’s holding you back from gaining instant and accurate cash visibility. There’s a more efficient and effective way to forecast. 


How to Strengthen Your Cash Flow Forecasting and Strategic Planning Capabilities

  1. Future-Proof Your Data Strategy
  2. Automate The Generation of Your Cash Reports and Forecasts
  3. Utilize AI and ML Technology To Continuously Improve The Accuracy of Cash Flow Modeling


1. Future-Proof Your Data Strategy

If you have to refresh your dataset every time you build a cash flow forecast, your treasury needs to rethink your access to data, data performance, and if you can rely on your data management methodology long-term. 

The best way to improve access to your data is to future-proof their data strategy with bank APIs paired with an automated cash management platform, like Trovata. Our extensive library of open banking APIs establishes direct rails between your banking providers and your Trovata platform, automating the consolidation and normalization of your balance and transaction data across your global bank accounts into a Multi-Bank Data Lake™.

Automating data management processes has saved our clients a multitude of hours, which has empowered them to focus on strategic analysis that grows their business:


“When I first joined Eventbrite, my day-to-day consisted of logging on to all of our different bank portals, running reports to see balances for each of our accounts, and then trying to standardize all this data in excel to build summaries…I spent 2-3 hours a day just pulling and normalizing bank data before Trovata, and that wasn’t a good use of my time… With Trovata, we have saved 12 hours a week from doing manual work, which is a big deal.” 

Nial Burke, Global Treasury Manager at Eventbrite


Eventbrite Case Study


“Trovata gives us the flexibility and control over our data. While most of our accounts are automated, Trovata ensures we can still add in additional data from outlier accounts. Just being able to key in the balance on-the-fly allows us to have full visibility across all of our accounts.” 

Tim DiLillo, Director of Treasury at GoTo (Formerly LogMeIn)


GoTo Case Study


2. Automate the Generation of Your Cash Reports and Forecasts

Gaining richer access to your data is just one piece of the cash flow forecasting puzzle. If you are still manually managing your data in spreadsheets, your analysis capabilities are still limited. Automating the generation of your cash reports and forecasts doesn’t just save you time, it empowers you to perform more aggressive scenario planning. 

As we saw during the COVID-19 pandemic, treasuries that were able to proactively forecast an extensive amount of scenarios were able to identify potholes within their cash management strategy and implement cash contingency plans when those scenarios became a reality. This extensive scenario planning is just impossible with only human invention due to the lack of time and team resources.


3. Utilize AI and ML Technology to Continuously Improve the Accuracy of Cash Flow Modeling

To review, according to IBM, Artificial Intelligence (AI) leverages computers and machines to mimic the problem-solving and decision-making capabilities of the human mind, while machine learning (ML) empowers computers to learn without explicit programming or human intervention once initialized. 

These two technologies are having a significant impact on cash flow forecasting accuracy in a critical way: they find anomalies, insights, and patterns humans simply are not able to discover through manual forecasting.

Trovata’s ML and AI capabilities not only transform your cash flow forecasts into powerful insights, but also increase the accuracy of your forecasts and scenario planning overtime. Every time your treasury generates a new scenario in Trovata based on user-defined, custom variables, like a decrease in sales of a particular product, or an increase in variable expenses, ML finds and measures directionality around time and relationships of certain transactions across banks. And AI continually takes patterns found in your data and produces more accurate forecasts based on your historic bank data.

With ML and AI, you can ensure your treasury can easily and accurately forecast around changing scenarios, business decisions, and potential investments and be prepared for any growth opportunities that may arrive at your organization’s door.


Strengthen Your Cash Flow Forecasting With Trovata’s Automated Cash Management Tools

While digitizing and automating your cash flow forecasting may sound daunting, especially when your treasury has forecasted manually in spreadsheets for years, you do not have to go it alone. Download the Essential Treasury Reporting and Forecasting Guide to discover how your treasury can gain critical insights across your global bank accounts and analyze, report, and forecast faster and more accurately.


Download the Essential Treasury Reporting and Forecasting Guide

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