Increasing frequency of crises 

We do not know whether the frequency of crises will increase over time. Some economists are convinced we should face more often colored swans and crises. To become more resilient, CFO’s will require from their treasurers more real-time information to enhance decision-making processes. These new demands from C-level will require new technical skills to enable them to produce better dashboards and forward-looking reports. All this is feasible providing we can make smart use of data and generate appropriate analysis. CFOs expect to better navigate the dunes of the economy. We also faced number of cyber-attacks during COVID. If we do not want to rely on Excel, it is better to be better prepared. The recent pandemic was the worst possible event to imagine; but it has indirect and unexpected consequences as it opened doors and created breaches.

 

Predict more and better otherwise you will die 

Crises, combined with disruption of businesses caused by pandemics or any macro-economic event, have increased demand to unprecedented level on corporate finance and treasury managers to focus more than before on predictive analysis. Treasurers are well placed to proactively predict risks and anticipate problems, providing they contemplate new solutions, from strong state-of-the-art suppliers, with specialists. Technology is one thing, implementing it properly is another one. Treasury departments need to use external support and trusted partners to develop these required approaches and for enhancing reporting. The real-time treasury means faster access to data, after treatment and analysis, to extract pieces of information driving to recommendations. What should not be forgotten is the crises frequency acceleration. If treasurers consider to base decisions on future rather than on past results and events, they need better integrated IT equipment to make best use of data extracted, transformed, and analyzed. Predictive analysis means making use of historical data and patterns and to integrate a portion of assumptions to stress-test scenario.  

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“Harder, better, faster” (Daft Punk) 

The first challenge consists in convincing C-level of investing in digital transformation. The second one in selecting the most adequate technology, if possible integrated to get access to a maximum of data, between systems (e.g., ERP, TMS, etc..). To go faster with your car, you need better brakes. To implement “real-time” treasury, we need better IT solutions, no use of spreadsheets and capacity to automatically produce reporting and to integrate them into dashboards. And we also need to customize dashboards faster. It requires to re-think your whole finance function. Once we have selected the technology, we need solid partners to accompany the implementation and to educate teams. When you decide to opt for SAP4hana a partner like INTENSUM seems to be appropriate to guarantee successful implementation and transfer of know-how. Before facing the next storm, better to be fully equipped with more than a compass to navigate the tempest. “In a calm sea, every man is a pilot” (John Ray), but when it starts being agitated, it is another story.  

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What makes the situation different today? 

Today, no treasurer wants to be on the wrong side and unprotected to face coming challenges. However, only few dynamic treasurers have started data analytics projects. When economic situation may change fast(er) than ever, the agility and proactivity become key attributes for a treasurer. To move forward in this tortuous and mined field, we must rely on and access to internal and external data from various IT sources to do more forecasting, modelling, (stress) scenario building, cash-flow forecasting and sensitivity tests. Businesses have evolved over the years and now we discovered data as something of high value. We would qualify them as gold, as often claimed, but as a valuable commodity, providing you can make good use of it. If getting access to data, under different formats and from different sources is not formalized and automatized, no chance to make any use of them. It will be too late when you will get them.  

 

Leading Intelligent Treasuries 

To reach the “treasury-on-demand” level, a treasurer must start drafting a digital transformation roadmap, with specialists, and revisit all processes to enhance them through new technologies. It is a complete overhaul of treasury processes that is required. For a more dynamic management, treasurers need to implement new tools, rather than plugging external modules to existing IT architecture. Such a long transformation process implies adaptation, flexibility, and skills. Therefore, it leads to the next challenge: recruitment of new required expertise and tomorrow’s talents. Stop recruiting as in the past, hire data analysts or miners, geeks. The treasurers who understood this are a step ahead of peers. And in terms of soft skills, they need curiosity, empathy for ne tech’s, creativity and open-mind.to adopt requested level of scrutiny when analyzing figures. Diversity in team composition has proved to be an asset when it comes to transformation. As said by Maya Angelou: “Strength lies in differences, not in similarities”. The modern treasurer presents even more diversified skills than before. It is also because the future IT organization will be co-created with partners. Treasurers must keep learning and follow emerging technologies. If you do not have already finalized your Treasury future IT architecture, it is time to move.