How to Create Effective and Powerful Processes in 2025
This article is written by Palm Treasury operations can be a source of frustration for businesses. Board decisions depend on accurate cash flow data and reliable forecasts to make decisions, and treasury professionals are constantly under pressure to balance priorities and produce results. Some obstacles arise from complex, structural data issues with no obvious fixes. But more often, outdated systems and suboptimal resource allocation are to blame. Addressing these inefficiencies starts with identifying the root problems and taking actionable steps to overcome them. In this blog, we investigate what organisations need most from their treasury teams and how efficient treasury processes can empower companies to make more informed decisions. We’ll also look at strategies for streamlining cash flow management, improving forecasting, and optimising bank account structures. The Traditional Treasury The core function of treasury has traditionally been to manage cash and ensure liquidity. This includes maintaining enough cash on hand to meet obligations, managing bank accounts, and ensuring that payments and receipts flow smoothly. For many businesses, the treasury team’s role is behind-the-scenes operation that is largely unseen. If cash flow is steady, bank reconciliations are seamless, and forecasts align with expectations, then treasury is considered to be doing its job. However, this traditional view is no longer sufficient. Today, treasury operations are expected to drive strategic insights. Modern treasury teams are tasked with delivering real-time data, actionable forecasts, and risk management strategies that support growth and financial stability. What Are Treasury Operations? Treasury operations encompass more than just managing cash and accounts. Modern treasury teams are hybrid operators who leverage technology to implement systems and processes that ensure the business has strong financial hygene. They combine technical skills with strategic oversight to make cash flow management, forecasting, and liquidity optimisation as efficient as possible. For example, a treasury professional might: Advancements in technology have made it easier than ever to automate repetitive tasks, such as reconciling bank transactions or updating cash flow models. This shift allows treasury professionals to focus on value-added activities like scenario planning and liquidity risk management. Barriers to Effective Treasury Processes If your business struggles with slow cash flow reporting or inaccurate forecasts, two key issues are likely at play: outdated systems and a mismatch of skills within the treasury function. Outdated Systems and Processes Legacy Treasury Management Systems often lack the integrations and automation capabilities required for modern treasury operations, not embracing the latest technology like AI and current machine learning models. Manual processes, such as downloading bank statements and updating spreadsheets, are time-consuming and prone to error. Organisations stuck in these cycles will find it difficult to keep the forecast up to date in a timely manner. Skills Gaps Treasury operations require a combination of technical expertise and strategic thinking. Data analysis capabilities are becoming increasingly demanded of treasurers as they grapple with growing data sources and formats. Having access to strong IT resources is helpful, however it is the combination of the treasury expertise with the technical skills which is where the magic happens. Steps to Improve Treasury Operations Improving treasury operations begins with identifying bottlenecks and inefficiencies. Here’s how to get started: 1. Diagnose the Problem The first step is to assess your current processes. Where are the pain points? Are manual reconciliations taking up too much time? Is your cash flow forecast inaccurate or outdated? Map out your treasury workflows and identify tasks that consume the most resources. 2. Leverage Technology Look for opportunities to automate repetitive tasks. Cash management platforms such as Palm can help to automate cash positioning, forecast updates, and reporting. Ensure that your systems are integrated to allow real-time data flow between your ERP, bank portals, and other platforms. For example, implementing a Cash Management Solution that integrates with your bank accounts can reduce the time spent on payment processing and cash reporting by providing a single, real-time view of all transactions. 3. Optimise Bank Account Structures Many corporations suffer from overly complex banking structures with too many accounts spread across multiple institutions. Consolidating accounts and implementing sweeping arrangements can reduce fees and simplify liquidity management. 4. Focus on Forecasting Accurate forecasting is essential for proactive decision-making. Invest in tools and processes that allow you to model various scenarios, such as changes in revenue or unexpected expenses. This will help ensure you maintain adequate liquidity while minimising idle cash. The Role of Integrated Treasury Tools One hallmark of efficient treasury operations is seamless data integration. Treasury tools should work together to provide a unified view of cash flow, liquidity, and risk. For example: Free Up Time & Unlock Value Improving treasury operations is not just about cutting costs or automating processes. It’s about empowering your company with the tools, data, and insights needed to make informed financial decisions. By rethinking your approach to cash flow management, forecasting, and bank account structures, you can transform treasury into a strategic asset that drives growth. If inefficiencies are holding you back, now is the time to act. Start by diagnosing your processes, invest in the right technology, and ensure your team has the skills needed to manage a modern treasury function. With these steps, you’ll be well on your way to building a treasury operation that supports success. Also Read Join our Treasury Community Treasury Masterminds is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below. Notice: JavaScript is required for this content.
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Tariffs & the Shifting Role of the U.S. Dollar
This article is written by HedgeFlows For decades, the U.S. dollar has reigned supreme as the world’s reserve currency, underpinning global trade, investment, and economic stability. This dominant position, often referred to as the “exorbitant privilege,” has enabled the U.S. to maintain cheaper borrowing costs, predictable exchange rates, and larger deficits without significant economic fallout. But the ground is shifting. Global tariffs unleashed by Trump and geopolitical tensions, particularly between the U.S. and China, and an increased focus on supply chain security have triggered unprecedented shifts in global trade dynamics led by President Trump’s administration. To those at the helm of mid-market enterprises, these seismic changes may have felt slow-moving and distant until recently. Still, the events of the last two weeks and their potential impact on financial strategy, procurement, and everyday operations cannot be overstated. What’s changing, and why does it matter now? For decades, nations like Japan and China have willingly accepted U.S. dollars as payment for goods and services sold to U.S. companies and consumers, using them as a safe reserve currency. However, as global economic dynamics shift, the long-term dominance of the greenback as the world’s primary reserve currency is increasingly being called into question. Europe is navigating its evolving relationships with the United States, while China has grown powerful enough to engage in a full-scale trade war with the world’s leading superpower. These developments are reshaping the financial landscape, challenging the greenback’s once-unquestioned supremacy. Consider this striking fact: foreign governments and institutions currently hold over $7 trillion in U.S. Treasury securities – more than the total government debt the US has to refinance over the next 24 months. These holdings not only reflect confidence in the U.S. dollar but have also formed a crucial support system for America’s economic structure. They fund unprecedented deficits that the US has enjoyed for decades. A shift away from such reliance could have wide-ranging consequences for businesses globally. What’s Driving the Shift? 1. Onshoring Push in the U.S. Amid Trump’s government tariffs rollout and renewed calls for supply chain security, the U.S. is focused on producing more goods domestically. Geopolitical tensions with China and vulnerabilities exposed by the pandemic have accelerated this transformation. Goods once predominantly imported, such as semiconductors and essential technologies, are increasingly being manufactured on home soil. While this shift is good for domestic industries, it reduces the global demand for the U.S. dollar in trade transactions, an effect mid-market businesses must prepare for. 2. China’s De-Dollarisation Efforts China, long dependent on the U.S. dollar for trade, has launched de-dollarisation campaigns aimed at reducing that reliance. Recent agreements to settle oil trades with Brazil in yuan exemplify this strategy. Additionally, the rise of digital currencies, including central bank digital currencies (CBDCs), is further disrupting dollar-dominated trade norms. China has been increasingly pushing for the use of the renminbi (RMB) in its global trade engagements. One significant milestone in this effort is the trading of oil futures in Shanghai, priced in RMB rather than U.S. dollars, which has gained traction among Middle Eastern oil producers. This move not only strengthens the renminbi’s position as a viable currency for international trade but also challenges the hegemony of the U.S. dollar in global energy markets. By encouraging its trade partners to adopt the RMB, China aims to enhance its economic influence and reduce exposure to dollar-based fluctuations, marking a decisive shift in global financial dynamics. A significant concern among investors is how China’s dollar strategy might unfold. If market participants begin to anticipate large-scale selling of U.S. Treasuries by China, this could trigger capital flight, eroding the dollar’s strength. Something that came to the fore the week after Trump’s recent tariff announcement on the 2nd of April 2025. 3. Rise of Digital Currencies and Non-USD Trade Technological advancements, combined with geopolitical motives, are fuelling the adoption of alternative currencies in global settlements. Whether it’s Russia-India trade conducted in rubles or yuan trading agreements with African nations, the share of non-USD payments is rising. The result? A Diminished USD Demand These trends collectively lower the global need for USD reserves. Businesses could face increased volatility in cross-border transactions as the cushion provided by widespread dollar usage starts to thin. What Is the Exorbitant Privilege and Why It Matters The U.S. dollar has historically benefitted from being the world’s reserve currency, giving it a unique edge. Here’s why that’s significant: For private businesses, access to cheap capital and stability in currency has been an indirect boon, streamlining operations and growth. However, mid-market CFOs need to recognise that these advantages may weaken in the years ahead. What Could Change and What CFOs Should Watch Over the next 5–10 years, several risks could arise for businesses heavily reliant on the dollar-dominated global economy. Potential Risks CFOs Need to Monitor Strategic Takeaways for Mid-Market Finance Leaders For CFOs of mid-market businesses, navigating the shifting role of the U.S. dollar requires strategic foresight and agility. Here are key steps to consider: 1. Build Resilience Against Volatility Invest in systems such as HedgeFlows that enable faster, real-time decision-making for treasury and risk management. Budgeting and forecasting tools that incorporate dynamic scenarios are invaluable when economic conditions are unpredictable. 2. Diversify Funding Sources Explore non-dollar-denominated funding options or global capital markets to hedge against dollar-specific risks. 3. Monitor Risks Proactively Regularly assess creditor, supplier, and even banking risks. Be prepared to act swiftly in response to economic or geopolitical changes. 4. Manage Currency Exposure Strategically Adopt robust FX risk management strategies. Consider currency hedging where needed to reduce exposure in global transactions. 5. Stress-Test Your Financial Models Run scenarios assuming sharper interest rate hikes or heightened FX volatility to ensure preparedness for potential shocks. 6. Stay Educated and Proactive Keep a close watch on insights from trusted organisations like the Federal Reserve, IMF, and financial publications. Diversify the information sources to avoid falling prey to echo chambers. Closing Thoughts: What Comes After the Dollar? “There are decades where nothing happens; and there are weeks where decades…