About: This Course:....xi
How to Take This Course:....xiii
Introduction:....xv

1 The Reengineering of Organizations:.... 1

The Significance of Reengineering
Changing Management Fashions
What Triggered the Obsession to Reduce Costs?
    Excess Production Capacity Due to International Competition
    Employee Visibility as a Cost Driver
    The Diminishing Role of Management
    Middle Management Is Costly
Management and the Cashflow Timeline
    What Is the Cashflow Timeline?
    Analyzing the Cashflow Timeline
Can the Objectives of Reengineering Be Accomplished?
The Solution of Cashflow Reengineering
    Significant, Realistic Savings
    No Massive Downsizing
    No "Religious" Experience Required
    A Reasonable Time Commitment
Action Steps
Mini-Case: Sunbeam Corporation
Review Questions

2 The Role of Cash in Specifying the Objectives of the Business:....15

Cash and the Myopic Manager
Fallacies in Defining Business Objectives
    Creating a Customer
    Profitability
    Management by Objectives (MBOs)
    Benchmarking
Objectives of Cashflow Reengineering
Managerial Myopia
Action Steps
Mini-Case: Diversified Colossus
Review Questions

3 The Cashflow Reengineering Process:....29

Cashflow Timeline Elements
    Step 1: Establishing Alternative Scenarios
    Step 2: Quantifying the Scenarios
    Step 3: Creating a Scenario Impact Table
Qualitative Reengineering Issues
    Site Considerations
    Lockboxing Considerations
The Vision Thing
Action Steps
Mini-Case: Acme Manufacturing Company
Review Questions

4 Balance Sheet Reengineering:....51

Cash on the Balance Sheet
Managing Balance Sheet Capital
    The Cost of Debt Capital
    The Cost of Equity Capital
Managing the Average Cost of Capital
Managing Working Capital
Managing Receivables
    Factoring
    Receivables Collateralization
    Asset-Based Lending
    Payment Incentives
Inventory and Trading Partner Relationships
Fixed Asset Leasing
Action Steps
Mini-Case: Continental Chemical Company
Review Questions

5 Income Statement Reengineering:....65

Cash on the Income Statement
Present Value Analysis
    Net Present Value
    Internal Rate of Return
    Marginal Cost of Capital
    Present Value Limitations
Cashflow Reengineering Profitability Analysis
    Present Value and Profitability
    Manufacturing Company Profitability Elements
    Profitability Analysis Outcomes
Cashflow Documentation and Analysis
Activity-Based Costing
Action Steps
Mini-Case: We Are Computers Company
Review Questions

6 Collection Activities:....83

Reengineering Collection Activities
Invoice Generation
    Improved Invoice Design
    Timing of the Invoice
Practices in Cash Collections
    Post Office Float
    Collection Float
    Processing Float
    Control Issues
    Deposit Bank Issues
Types of Lockbox Operations
    Wholesale Lockbox Networks
    Retail Lockbox
    Image Capture Lockbox Technologies
Electronic Collection Services
Cost Analysis of Internal Processing and Outsourcing
Action Steps
Mini-Case: Royal Electronics
Review Questions

7 Disbursement Activities:....99

Purchasing and Payables Issues
    Year 2000 Concerns
Practices in Accounts Payable
Reengineering the Payables Function
    Multiple Vendors
    Phony Vendors
    Pay Date versus Due Date
    Review of Invoices
Controlled Disbursement
Account Reconciliation
Practices in Payroll Disbursement
Procurement Cards
Comprehensive Payables
Cost Analysis of Internal Processing and Outsourcing
Action Steps
Mini-Case: Green Earth Corporation
Review Questions

8 Concentration Activities:....119

Concentration Mechanisms
Balance Management
The Banker Visit
The Daily Cash Position
The Cash Forecasting Process
    Cyclical Forecasts
    Seasonal Forecasts
    Daily Forecasts
Bank Compensation Issues
Sweep Accounts
Investment Management and Advisory Services
Cost Analysis of Internal Processing and Outsourcing
Action Steps
Mini-Case: Amalgamated Foods
Review Questions

9 The Outsourcing Alternative:....137

Why Outsource?
The Request-for-Information
The Request-for-Proposal
Evaluation of the Proposals
Action Steps
Mini-Case: An RFP Case
Review Questions

10 Reengineering the Role of the Treasurer:....153

OPQR Problems and Solutions
    The O Problem: Organizational Performance
    The P Problem: Process
    The Q Problem: Quantification
    The R Solution: Reengineering
    Quantifying the R Solution
Expanding the Responsibilities of Treasury Managers
    Legislative Reform
    Product Innovation
    Sales Financing
    International Treasury Management
    Cash Security and Control
    Information Security and Control
Prospects for Internal Improvements and Outsourcing
Prospects for the Organization
Action Steps
Mini-Case: The Power Company
Review Questions

Glossary:....167
Recommended Reading:....181
Post-test:....185
Index:....189

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