On the path to a digital treasury world, leveraging a fully automated treasury management is the foundation. It is the transparency and availability of global corporate data in real time that treasurers appreciate, which offers considerable added value for managing them, particularly in today's times of global crises. Streamlining daily workflows and thus increasing productivity through optimized existing processes as a result of adopting a company-suitable TMS solution underscores its indispensability for an efficient and cutting-edge treasury. The resulting automation also helps eliminate sources of error, increase security against fraud and optimize risk management. 

In the previous issue of KPMG Corporate Treasury News, we looked at the "Necessary prerequisites for establishing and expanding a modern treasury function" from a legislative and regulatory perspective. If, after a thorough analysis of the content-related system requirements, a company has decided to introduce or upgrade a TMS, the next step is then to go ahead and implement the project. An essential but quite challenging part of any TMS implementation or upgrade is the test phase. In this regard, the project's success or failure depends heavily on a dedicated test management system, which we will discuss in the following section of this article. 

The necessity of strategically redesigning traditional test management

Any delays in the course of the project frequently come at the expense of the testing phase. Incorrect entries, faulty assessments, failure to pay, violations of compliance guidelines - these are just a few examples that can arise as a result of inadequate testing and have major repercussions. 

While the typical and outdated test process still had to struggle with documentation and coordination problems or even intransparency, a modern test management system that is tailored to the test requirements of the respective project will blaze a new trail. The key pillars of redesigning traditional test management are automation, cloud- and platform-based test management and KPI tracking software.

Embracing the benefits of a TMS transformation, a modern test management approach offers the ideal way to address the challenges of a TMS implementation or upgrade. As such, modern test management also breaks away from the typical, strict division into phases of traditional testing into test planning, test preparation, test execution with the corresponding defect management, and the associated test documentation. Correction loops within the test process enable flexible and agile management and ensure documentation and error management in a project-related and semi-automated manner. 

Modern approaches to classic challenges

Our project experience over the past few years shows that when it comes to test planning and preparation, particular attention must be paid to the time component, as test preparation, execution and bug fixing are often underestimated and the project timeline is then distorted retrospectively. It is not unusual for system implementations to result in delays and realignment of project times - to the detriment of testing activities. Often, a shortened test time impacts the level of coverage of functionalities as well as the test documentation. The resulting relevance for the annual audit and subsequent adjustments to the system after go-live should serve as a warning with regard to a premature cutback of test activities and should serve as a reminder to set up an agile time buffer.

Client-specific BI solutions can provide a remedy for this. They not only enable the virtual modeling of process chains and test sequences while promoting transparency and understanding within the project teams, but also allow for detailed and precise time estimates for test runs using heuristic time estimators for test steps, system transitions and sub-project areas.

In only very few projects can existing, fully documented test cases actually be used, which means that the first step is to create the test cases for the various test topics and phases. It is important to start at an early stage in order to bridge the gap between the original business requirements and the final result in the TMS. In many instances, the creation of test cases is based on the zero-one principle, in which a test case description is marked as either "not finished" or "finished". Another problem is the tendency to try to cover as many topics as possible with one test case, which makes it more difficult to assess the impact of errors during test execution. 

This is where modern test management introduces KPIs with the associated monitoring and reporting, which go beyond the classic separation of "go-live relevant" and "non-go-live relevant". Below are some examples of KPIs that increase transparency and provide more security:

  • Number of acceptance criteria for each functional requirement
  • Number of test cases for each acceptance criterion
  • Number of acceptance criteria covered by a test case
  • Number of business requirements covered by a test case
  • Quality levels of the test case description, for example purely functional, step-by-step implementation in the TMS
  • Use of the test case, for example functional test, integration test, user acceptance test

KPIs can be customized as required and presented clearly and in line with the needs of the target group with the help of graphically prepared reporting. This assists the quality assurance of the test cases and allows the project management to react to any resource bottlenecks at an early stage.

The phase of test execution and the related defect management is often fraught with coordination problems and ambiguity in terms of responsibilities. Tasks generated by the testing itself, bug handling or day-to-day business need to be clearly communicated to the team in a people-oriented manner and tracked on a day-to-day basis. Dashboards with updating tasks and timeline entries are indispensable during testing and must be integrated meaningfully into the working environment used. Another related but no less important element of the test phase is team-internal and management reporting. Only by transparent reporting to the project team can progress, blockers and problem solutions be tracked and controlled efficiently and on a prioritized basis. 

From today's perspective, the need for transparent and semi-automated reporting is indispensable. Specifically, integrating cloud solutions and reporting tools permits the use of symbiotic effects. Progress, subject area prioritization, and time delays of sub-project teams and linear updating of the current rate of progress for planning purposes can be processed in the form of graphs and tables and communicated transparently to the project team at regular intervals. Doing so helps to gain understanding and acceptance for the project progress on both the company and the vendor side and allows for agile adjustments of the project phases based on project development and error occurrence. In this context, it is also helpful to introduce KPIs such as go-live relevance, test coverage of processes or priority, which are established at test case level and used as a basis for analysis and evaluation loops.

In order to adopt a modern approach to project monitoring and status reporting, the platform solution offers useful enhancements for preparing and tracking the test data, test progress and the number of bugs. Benefiting from accurate and appropriately documented testing is also the company's quality management. The different test phases can be coordinated with each other and changes in the test process or at the functional level can be highlighted and assessed with regard to risk management aspects. The different test phases can be coordinated with each other and changes in the test process or at the functional level can be highlighted and assessed with regard to risk management aspects. Management-side evaluation and assessment of test progress and error occurrence benefits from this just as much as the executing tester and project reporting. 

In many cases, such a cloud- or platform-based solution can also be linked to a Kanban board, which simplifies the clear task assignment and monitoring. As a result, both the individual employees and Management have transparency about the current situation and future development, which in turn enables them to act proactively and not just react to critical challenges that have already occurred.

Finally, a classic challenge of test management is the audit-compliant and multi-team documentation of test execution. For instance, TMS systems serve as the data basis for ERP systems, and the resulting accounting relevance must always be included in both implementation planning and audit compliance. Consequently, the system data must be fully validated and documented in the course of the numerous test sections so as to ensure frictionless system use as well as to meet year-end audit requirements. 

The focus here is not only on completeness, but also on an appropriate level of detail. The latter requires uniform guidelines for different test phases and agreement on successive test components of different sub-projects. In this respect, cloud or platform-based solutions are now paving the way for audit-compliant documentation by allowing it to be added directly to the respective test steps. 

Success factors of an outstanding test management

In conclusion, the market is moving towards automated agile test management and away from traditional and primarily manual test management. There are now a selection of supporting tools that offer added value in terms of requirements management, test planning, functional and performance testing, and defect management that offer benefits that should not be underestimated. BI solutions also support process modeling and enable state-of-the-art reporting and documentation at all test levels.

Source: KPMG Corporate Treasury News, Edition 121, May 2022
Nils Bothe, Partner, Finance and Treasury Management, Corporate Treasury Advisory, KPMG AG
Karin Schmidt, Senior Managerin, Finance and Treasury Management, Corporate Treasury Advisory, KPMG AG