The Future Role of Treasury Department

The Rise of Digital Era in Treasury

Technology plays a key role in today’s and tomorrow’s treasury. With increased volatility, treasury demands more visibility over cash flows and easy access to data to gather better insights for cash management automation. Technology lifts treasury strategically by making accurate predictions.

As technology is gaining momentum and steadily evolving, the treasury department also needs to broaden its horizons to keep up with the change.

Must-have Skills for Treasury Department

Treasury is divided into three key roles, which are:

• Treasury Analyst: Analyst’s work mostly comprises manual and repetitive work, but technology facilitates treasury analyst’s role to shift from menial work to process improvement and reporting. This requires analysts to hone their analytical skills and tech-savviness.
• Treasury Manager: A treasury manager’s role in improving productivity and managing teams. This requires bridging gaps in processes, managing team KPIs, and ensuring that the team is meeting its goals. Hence, they should possess strong communication skills.
• Treasurer: The role of the treasurer is to manage liquidity and risk. As a result, treasurers have to be proactive and advocates of digital transformation.

Treasury Skill Sets to be Future-Ready

• Adaptability to the latest technologies and industry trends
• Strategic business planning
• Relationship building skills

This is how a day in the life of the treasury department looks like

Treasury Analyst’s Tasks

A treasury analyst’s daily tasks include:

• Tracking cash inflows and outflows
• Documenting cash flows into the general ledger
• Identifying process improvements
• Creating reports regularly

Almost all tasks can be automated apart from identifying process improvements. Leveraging automation minimizes errors and helps an analyst focus more on strategic responsibilities.

Treasury Manager’s Tasks

A treasury manager’s common tasks include:

• Cash forecasting
• Cash management
• Cash and deal accounting
• Bank relationship management
• FOREX management
• Counterparty risk reporting
• Board reports preparation
• Payments

A lot of tasks mentioned above can be automated such as:

• Cash forecasting
• Cash and deal accounting
• Counterparty risk reporting
• Board reports preparation
• Payments

And the rest of the tasks can be enhanced through automation to interpret the data with increased visibility and better visualization to make strategic decisions with statistical evidence.

Automation takes care of the manual and repetitive tasks so that the managers can focus more on KPIs and business planning. With richer reporting and better decision-making, the treasury manager is seen as a process specialist who can build more trust with the treasurers and CFOs.

Treasurer’s Tasks

Treasurers’ roles and responsibilities vary from organization to organization. On a high level these are the tasks they need to control on a daily basis:

• General financial oversight
• Financial planning and budgeting
• Fundraising and sales management
• Banking and finance reporting
• Record-keeping
• Fixed assets and stock management

Since most of these tasks require human input, it is necessary for the treasurer to have a highly accurate financial picture for making decisions and report them to the CFOs. Thus it is important for managers and analysts to provide reliable data that are fact-driven and not just relied on assumptions.

Sometimes the roles within the treasury department may converge with one another or differ based on the size and revenue of the firm, and AI is definitely an enabler for escalating treasury’s success.

How to be Future-Ready?

In order to partner with technology, one must not fear job loss but understand that it adds value. Here’s the 4E framework to adopt technology:

4E Framework in Digital Revolution

1. Embrace: It’s crucial to be technically sound and embrace change.

2. Evaluate: Evaluate skills regularly and critically analyze if they are fit for the present and the future.

3. Empower: Develop a new set of skills and work with the latest technologies.

4. Educate: Educate from webinars, training, etc to learn about new and upcoming technologies.

Technology is playing an ever more pivotal role in the new normal. Learn how you can repurpose your skills into forward-looking and high-value skills to maintain the status quo.