A new era of digital finance for treasury teams

Hybrid and remote working are becoming commonplace as organizations of all sizes and types adapt to the pandemic era and implement more resilient ways of working. According to PWCless than one in five executives say they want to return to the office because it was before the pandemic.

Before the global pandemic, many treasury teams knew they needed to switch from paper to digital, but adoption was difficult, and this change often fell into the nice-to-have category. Treasury teams often used spreadsheets to manage cash forecasts. They relied on printed checks filled out and posted on the spot and mailed out for their accounts payable. This all happened as much of the world, especially consumers, shifted to digital payments.

Like other aspects of doing business, the pandemic has forced many treasury teams to rethink the efficiency of these manual processes. They have been looking for remote-friendly approaches to doing their jobs, allowing them to innovate, reassess their risks, and ensure that the IT infrastructure is prioritizing the shift to this digital mindset.

This has led to more organizations implementing cloud-native automation tools and processes to ensure business continuity. Research found that CFOs and treasurers are more focused on technology improvements and digital innovation than to in 2019, with a main objective of gaining efficiency and generating more impactful information. Departments continue to focus on data analysis, process automation and visualization tools to drive digital transformations and demonstrate the value of treasury technology investments to support a wide range of businesses. While this trend is expected to continue, it will take time for this industry to fully utilize cloud computing in all its forms.

Overcoming barriers to transformation

One of the biggest barriers to realizing the full potential of digital transformation is the combination of aging and siled systems. These environments lack the integration treasury organizations need for quick visibility into cash, investment, and debt portfolios. They also hinder cross-departmental collaboration to improve performance.

Organizations that have implemented a cloud-based financial management system can attest that despite initial challenges, the implementation helps them simplify the systems. It can drive huge efficiencies across the business, improve performance, and even help with risk management.

For treasury teams, this could mean optimizing or streamlining treasury/cash operations, particularly in the processing and collection of payments or making cash management, banking and payment practices more efficient and economical.

From a people’s perspective, digital transformation can also help overcome the impact of the “big quit” happening across the country. Traditionally, roles in cash management have always involved menial and mundane tasks such as reconciling spreadsheets, recording payments, and financial forecasting.

The good news is that going digital helps free up time, which, in turn, boosts morale and retention numbers in this competitive climate. Companies also report that adopting new technologies helps recruit new team members, as many simply won’t accept a position on a team that relies on manual processes.

Take a phased implementation approach

While the possibilities and benefits of cloud-based tools are endless, it’s rarely easy to implement large-scale changes.

Implementation should take place in a phased approach to spread costs and risks. Start by testing. Then deploy it to a domain before deploying the new processes more widely. This approach will give you a better chance of getting it right the first time. Plus, you’ll likely avoid stopping and starting on a much larger scale.

It is essential to remember that these solutions are not universal. Instead, treasury teams should think of the process as putting together a puzzle. For complex situations, this can mean working with multiple partners to create, implement, customize, and scale the solution that’s best for your treasury team and organization.

Proper training is just as important. When rolling out training for these systems, think of it as a balancing act. Use this time to make sure long-time employees are familiar with the new processes. But also view this time as an opportunity to introduce innovation to the next wave of employees.

To move forward (and stay ahead), treasury teams must innovate and adopt advanced systems and leading practices. Resilience is no longer optional. Every organization should start with specific, measurable goals. Then work with trusted advisors to take a multi-pronged approach that starts small and scales easily across the organization. Transformation is a long journey, but it comes with great rewards.

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