How to cope with Treasury Transformation

 

Whenever we mention change or transformation is coming, it naturally creates some unease and it is tempting to wonder “is my job at risk?” Headlines are not helping to offset this sentiment as they usually suggest that a certain amount of jobs will be taken over by machines within a hand full of years.

So, what? The world changes, people change, and so do roles & organization: they (must) change, they (must) adapt.

 

It is time to transform! We cannot solve our problems with the same workflows we used when we created them: every company should right now undergo a treasury transformation assessment to optimize their treasury organization. I’ve read many articles about the multiple ways to manage it, while in reality I think there are only two: either you resist or embrace it. That being said, the only way to prepare for the future is not to resist it, but to work with it. Even better: owning treasury transformation puts you in the driver’s seat. Don’t allow yourself to slowly but surely let this opportunity slip by.

 

Often when we talk about transformation, it usually resonates as we’re only talking about technology. Remember that technology is the enabler, but it will not do the entire transformation journey. Yes, automation is designed to improve processes and KPIs, allowing finance professionals to focus on exceptions and higher value functions, making every aspect of our job more efficient and less painful. It also allows us to take the next step forward in adding value to our business and in our career. Technology will enable us to be strategic & data-driven powerhouse organizations.

But you also need different organizations, different workflows. In fact, this piece is much more difficult and takes a while to put in place vs implementing a new technology software. Therefore, treasury transformation is not only about automation & digitization: it’s also about centralization & operations excellence.

 

It is urgent for treasurers to elevate their thinking from tactical to strategic right now. The reasons driving this sense of urgency are multiple: constantly changing market conditions & evolving regulations, increasing pressure on performance & working capital optimization, needs for closer coordination & interaction with the businesses, needs for streamlining tools & processes across organizations, reassessing banking relationships (our suppliers) more often, increasing synergies, improving cash planning, centralizing FX & liquidity management, … amongst others.

 

Don’t give me wrong: although this journey sounds exciting, every transformation brings its set of underlying risks. Failure is almost inevitable, and organizations must make sure their teams are well equipped in terms of values & mentality to learn from those failures and move forward. The message must be clear from the very beginning that not all problems will be solved and that there will be gaps & adjustments to be made along the way, with absolute certainty. People management is also a big deal in transformation programs, given that roles will change and not necessarily remain a best fit to everyone anymore. It also creates uncertainty. People can feel that this is not what their career plan was initially. Even if it is usual not to be where we were expecting to be 10 years from now, you still need to be opened to that & prepare yourself and also prepare others. The best way will be to initiate your transformation journey with all stakeholders, including all employees who will be affected by it. Don’t throw it to their face once finished. Early engagement is key & source of success. Everyone will want to know what it means for them, specifically regarding their career opportunities & progression. The risk here is significant: loosing talents & knowledge, specially at a time you need them most. In order to mitigate this risk, managers have a duty to clarify, support, & listen to their teams (in transition periods more than usual).

 

Benjamin Defays

Treasury Manager

Koch Engineered Solutions