Think having excess cash on hand to smooth out the bumps in your forecasting really doesn't matter much in a world of rock bottom interest rates? Then talk to Jim Burns, general manager of treasury for the $920 million Chicago Transit Authority, the second largest public transportation system in the U.S. Before Burns led an overhaul of the CTA's treasury department, the office had lost control of the ins and outs of payments throughout the organization.

That all changed when the CTA installed a new ERP system from Oracle Corp. last year and Burns, with the help of its off-the-shelf treasury and cash management modules, went to work reorganizing. Now, helped by the system's flow of information into and out of treasury, Burns is better able to match future assets and liabilities, and says he has the confidence to put his spare cash to work. "We've been able to lengthen our maturity and capture some more yield. Where we were doing overnights or two-days, now we're able to go out maybe three weeks to a month and pick up three, four, five basis points on our investment portfolio," he says. The benefits don't end there. Burns says his office has also been better able to use its cash to improve its relations with key community vendors, making faster and sometimes earlier payments to the many small, minority-owned start-ups that provide the CTA with construction, janitorial and other services. "Being a local entity, we have a commitment to the community. More jobs created at the local level should translate into more ridership now and in the future," he says.

In the dog-eat-dog world most companies operate in, of course, helping to keep small suppliers afloat hardly translates into a key strategic use of cash. They face situations more like that of Entergy Corp, the $9.2 billion power and utility group. Better forecasting management has allowed the New Orleans-based company to rely less on outside sources to finance a string of recent acquisitions. "We bought four Northeast nuclear facilities in the last three years, and each one has gone a bit better than the last, with a better handle around cash flow forecasting and other treasury related tasks," says Entergy's finance operations center manager Steve K. Myers.

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