Seven steps to take your digital treasury to the next level

With so many aspects of digitalisation to consider, how can treasurers put the theory into practice? 

This swift pivot away from manual processes and on-premises tech presented a range of challenges for treasury teams – some struggled to gain visibility over cash; others were unable to make their payments online.

While working with their business partners to ensure the digital basics were in place, they were faced with other problems caused by the pandemic, such as supply chain risk and increased market risk.  But with the support of internal and external stakeholders, the majority of treasurers took these changes in their stride and achieved a functional level of digital treasury operations. As so many changes in the world continue to unfold, now though the question is where to next? How do you move been the initial short-term measures to a fully sustainable digital operation?

Next-level digital treasury explained

In today’s ever shifting and digitally centric environment, it is important to move beyond a basic digital treasury landscape towards a more efficient and insightful real-time environment. By linking every aspect of treasury – including FX – into a connected and comprehensive digital ecosystem you can help reap the true rewards of digital innovation going forward.

To create this digital ecosystem you need to combine tangible solutions including robo treasury, artificial intelligence, cloud computing and seamless digital payments and collections.

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Treasury Next Level White Paper (PDF, 1.4MB)

How to go from theory to practice

Moving towards a digital treasury can be a complicated process – not only do you have to decide which aspects of digital are right for your company, you have to get everyone on board, implement your decisions and consider future enhancements. Below we look at seven steps you should consider as your treasury embarks on its digital journey.

1. Speak to your business partners about how they can help you

Banks and fintechs offer many ready-made solutions that treasurers can adopt without any major disruption to their business, and often at minimal cost. It’s best to start with the low-hanging fruit – such as automating payments and reporting and using online banking – and progress from there.

2. Open your mind to the possibilities

There’s no need to be deterred from using technology simply because you don’t personally understand how it works or you can’t code: treasurers aren’t expected to build the solutions themselves. What’s more important is that they have an open mind to how the technology could benefit both the treasury and the wider organisation.

3. Re-evaluate treasury’s role

Treasurers need to ask themselves what the purpose of treasury actually is in a truly digital world in which everything occurs in real time and small or huge exposures can be managed identically. How should treasury responsibilities – and the treasury policy – be updated to reflect the digital, on-demand environment?

4. Recognise where manual processes still work well

It’s important not to go too far. Companies shouldn’t feel as if everything needs to be revolutionised with technology immediately. If a manual process works and is in fact more efficient than using multiple trade platforms, treasurers shouldn’t feel compelled to switch to a digital workflow simply for the sake of it. It may be worth waiting for a better platform to emerge down the line.

5. Set out the business case and bring the right stakeholders on board

Just because a treasurer can see value in a system or tool, it doesn’t mean management necessarily will too. The treasurer is an instrumental figurehead in the company, and needs to bring all the right stakeholders together – from procurement, to IT, to legal – to create a strong value case that extends beyond treasury and makes sense for the business as a whole. This is a particularly important consideration when the firm needs to make an upfront investment in infrastructure, because it might take some time before the company sees a return on its investment.

6. Implement a phased plan

A common pitfall when embarking on a digital journey is to do too much at once. Long-term vision is needed, but a phased roadmap is essential to turn the vision into reality. Small wins should be celebrated and the plan should be reviewed along the way for any additional sources of improvement that could be made. Business continuity should also be front of mind at every step of the plan.

7. Embrace continuous improvement

A digital treasury journey has no ultimate destination – the end goal will change in line with how the organisation evolves and with new technologies that become available along the way. While a plan is important, digital treasury transformation is an ongoing process that requires a mindset of continuous improvement.   

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