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Mastering the human side of Treasury: Why soft skills really matter

Mastering the human side of Treasury: Why soft skills really matter

When building a career path in Treasury, certain technical skills are very important. However, soft skills are what can elevate your career beyond what technical skills cannot. Soft skills like communication, problem-solving, adaptability, leadership, and collaboration are very crucial to attaining leadership roles.  Recommended Reading Let’s highlight the importance of these soft skills in a practical way: 1. Communication In a situation where you are presenting a complex financial report to company executives. Your ability to explain the numbers in a clear, understandable way is what keeps everyone on the same page. It also ensures confident decision-making. Without strong communication skills, important details could get lost in translation, leading to misunderstandings, and missed opportunities. 2. Problem-solving  Assuming you are faced with a sudden cash flow crisis due to a market downturn. Your skill for analyzing the situation, identifying key issues, and brainstorming innovative solutions is what really saves the day. Whether it’s renegotiating terms with vendors or restructuring debt, your problem-solving skills help you through challenging financial situations. And helps your company achieve its corporate financial objectives. I remember a time. After completing my cashflow forecast, I discovered that due to changes in the economic situation and the implementation of a Central Bank policy, our company’s cash flow was going to decline by 20%. And we were securing repayments to international vendors for capital expenditures. I simply proactively engaged the suppliers to restructure payment terms for a longer period, giving them a mitigation strategy for any repayment risk they anticipated. 3. Adaptability  Think about how rapidly technology evolves in finance. One day, you’re mastering a new Treasury Management System (TMS); the next, you are exploring the next, more efficient application for payments. Your ability to embrace change and quickly learn new skills ensures that you stay ahead of the curve and effectively leverage emerging technologies to streamline processes and enhance efficiency. 4. Collaboration In a situation where you are working on a major capital project that requires input from multiple departments—finance, operations, and marketing. Your ability to collaborate effectively, build relationships, and align everyone’s efforts towards a common goal is what drives the project’s success. By facilitating a culture of collaboration, you encourage synergies, take advantage of diverse expertise, and deliver impactful results that benefit the whole organization. Conclusion on Mastering the human side of Treasury While technical expertise is important in Treasury, it’s the soft skills that truly elevate professionals to leadership levels. Whether it’s communicating financial insights, solving complex problems, adapting to change, or collaborating across teams, mastering the human side of Treasury is what sets exceptional professionals apart from the rest. 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 to get more information. Notice: JavaScript is required for this content.

Modernizing Treasury Management: Treasury Delta’s Fintech Innovation Recognized by EY UK

Modernizing Treasury Management: Treasury Delta’s Fintech Innovation Recognized by EY UK

Exciting news just in: Treasury Delta, a strategic partner of Pecunia Treasury and Finance (Pecunia), has been chosen by EY UK for their Fintech Growth Programme. This recognition shines a light on Treasury Delta’s innovation, which will streamline corporate treasury transactions, particularly within treasury management. Pecunia’s decision to team up with Treasury Delta stems from a shared vision of simplifying day-to-day Treasury operations, especially the complex and costly request for proposals (RFPs). Together, they aim to leverage digital technology in order to remove friction points and they have recently undertaken their first successful transaction together. Katja Palovaara, EY Programme Manager, has praised Treasury Delta’s digital platform, stating, “Treasury Delta’s innovative digital platform stands out, promising a transformative impact on the future of financial transactions with its exceptional efficiency and cost-effectiveness. Their customer-centric approach and commitment to automation herald a new era for Treasury projects.” The Importance of Tech in RFPs: Saving Time, Money and Improving Decision Making Traditional RFP processes in treasury management are very time-consuming and resource-intensive. However, with technology such as Treasury Delta’s digital platform, these challenges are being addressed effectively. By incorporating tech-driven solutions, organizations can significantly reduce the time and effort required to conduct RFPs. Automation streamlines data collection and analysis, allowing Treasury professionals to focus on strategic decision-making rather than administrative tasks. This efficiency not only saves time but also reduces the operational costs associated with manual RFP processes.  Furthermore, advanced analytics capabilities provide deeper insights into vendor capabilities, pricing structures, and market trends, empowering Treasury teams to make more strategic and informed choices. The use of technology in RFPs also facilitates better communication amongst stakeholders. Cloud-based platforms, like Treasury Delta’s, enable real-time access to data and insights, fostering collaboration between Treasury professionals, vendors, and other relevant parties. This seamless exchange of information enhances transparency and accountability throughout the RFP process. In summary, as organizations continue to prioritize efficiency and innovation in their treasury operations, tech-driven solutions like Treasury Delta’s platform will play an increasingly pivotal role in driving success.  This recognition by EY UK validates Treasury Delta’s niche position as an up-and-coming player in fintech innovation, poised to drive significant advancements in treasury management practices. If your firm is interested in exploring this innovation, inquiries can be directed to Pecunia at info@pecuniabv.nl or by registering your interest at https://treasurydelta.com. 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 to get more information. Notice: JavaScript is required for this content.

An Interview with Sebastian Muller-Bosse, Board Member of Treasury Masterminds

An Interview with Sebastian Muller-Bosse, Board Member of Treasury Masterminds

Q: Let us know you, Sebastian. Tell us a little bit about yourself and your journey in treasury I joined Finance & Treasury Services as a Corporate Treasury Manager after finishing my Master’s in “Finance & Accounting” at Leuphana University Lüneburg. While I was studying, I did several internships in corporate treasury departments, which helped me gain a lot of experience in treasury operations and currency management. For example, I was involved in implementing a new global treasury management system and revising a hedging strategy. Before this, I spent a year in treasury consulting with one of the Big Four accounting firms, where I helped clients set up their treasury functions and improve their organizational, procedural, and methodological approaches. I also have a background in banking, having completed a banking apprenticeship. Also Read: An Interview with Benjamin Defays, Board Member of Treasury Masterminds Q: What specific skills do you believe are essential for success in treasury management, and how have you developed and utilized these skills throughout your career? 1. Corporate Banking: Hard Skills Since specifically Treasury Management concepts, methods, or instruments are not widely taught in academics as an individual subject like Controlling or Accounting, a sound understanding of corporate banking and cash & risk management, as well as financing products, is important. Treasury really begins with the bank relationship, ergo bank account management, investing and lending cash, etc. Most payment products or banking services are not hard to understand but it’s an advantage to be familiar with the “slang” and environment before starting a job in treasury. “Learning on the job” (see below) or visiting specialized seminars is a common way to develop the necessary skills throughout your career, making sure that you gain the relevant knowledge for your daily operations. 2. Analytical Soft Skills The fundamental tasks of a Treasury Manager are to create transparency, reduce financial risk, and ensure liquidity and solvency at all times. Where do I need cash, in what currency, and at what time? To answer these questions, you need to create sophisticated, comprehensive reports, that show data about your cash flow. There are many tools out there that help you visualize your cash flow in beautiful-looking tables and graphs. The real pain really starts at the beginning, though. No one likes to (a) collect, (b) save, and (c) clean the data, except you’re a real data wizard. The role of the Treasurer shouldn’t be about this data wrangling but the data analysis itself. You need to feel comfortable digging deep into the numbers and trying to figure out what story they tell. 3. The Rest: Learning on the job Since every Treasury is different, the requirements of businesses’ cash and risk management and financing can vary a lot. No Treasurer deals with all banking products and services, so you will soon find out what is relevant to your organization and what is not. One of your Treasury fellows might work in a trading company and deal with letters of credit every day, whereas you never understood how to manage them. A second fellow prepares for a bond emission, whereas you are only dealing with simple bank loans.  A third fellow is executing the cash status and forecast by the push of a button in their Treasury Management System, while you are still struggling with your manual Excel sheets. This is all completely normal and fine! Always try to improve your workflows and systems, automate processes where you can, and stay up-to-date with skills, trends, challenges, and regulations in Treasury. Q: In your opinion, what are the most significant challenges facingTreasuryy departments in today’s business environment, and how do you approach addressing these challenges? 1. Resources Labor market shortages plus the lack of sophisticated higher education, especially Treasury management, create a tight situation for corporations trying to fill their vacancies. Often, they demand experienced treasurers who are simply aging more and more and the young ones are not following fast enough. A temporary solution can be interim managers but in the long run, only universities can help increase the supply of recruits. 2. Budget Treasury departments are fairly low-staffed compared to other finance departments like controlling or accounting. Many corporations prefer to stack up their technology, trying to make machines do the work more efficiently, rather than hiring for more FTE. Often, approval for these kinds of projects faces a bottleneck at the C-level and budget is the prevailing argument. A well-prepared business case with quantitative and qualitative value is key to winning their hearts on a project like this since the overall goal isn’t normally about gaining a profit from treasury activities. 3. Change Management In the fast-paced environment of today, new digital skills are needed more than ever. Especially data literacy and agile working methods are promising to cope with new trends in technology and to overcome the old “we always did it this way” mentality. The younger generation knows that there are capabilities and solutions for “getting the job done”. They can be frustrated if the organization is not adapting to the new realities and continues business as usual. Integrating young people into the team brings new ideas to the table since they grow up with different views and approaches. 4. Embrace LinkedIn Treasury management is a dark niche in the big pond of finance. Connecting to your peers helps you navigate these waters, not only on your own. Many treasurers got to their position where they are more or less my chance since the career path isn’t shown to them after university. Therefore, the feeling of working in a fairly unknown financial terrain should be more of the norm than the exception. A great place to start is connecting on social media platforms, especially on LinkedIn. Today everyone is happy to have a big online network of like-minded people and it’s not weird anymore if you haven’t met the person in real life yet. 5. Subscribe to Newsletters There are good ways to stay up-to-date in treasury management,…

The Rise of Challenger Banks: Disrupting the Banking Industry

The Rise of Challenger Banks: Disrupting the Banking Industry

In recent years, the financial landscape has witnessed the emergence of a new breed of banks known as “challenger banks” or “neobanks.” These digital-first institutions are shaking up the traditional banking industry by offering innovative services, seamless user experiences, and a customer-centric approach. As consumers increasingly embrace digital solutions, challenger banks are gaining traction and rapidly expanding their customer base, posing a significant challenge to established, legacy banks. Traditional Banks: The Incumbents Face Disruption For decades, traditional banks have dominated the financial services sector, operating through extensive branch networks and relying on legacy systems and processes. While these institutions have long enjoyed a solid customer base and established brand recognition, they have often been criticized for their cumbersome processes, outdated technology, and lack of agility in adapting to changing consumer preferences. Enter Challenger Banks: Embracing Digital Transformation Challenger banks, on the other hand, are born digital. Unencumbered by legacy systems and physical infrastructure, these banks leverage cutting-edge technology, cloud computing, and agile development methodologies to deliver innovative banking solutions. By operating primarily through mobile apps and online platforms, challenger banks offer a frictionless and user-friendly experience, catering to the demands of tech-savvy consumers who prioritize convenience and accessibility Key Advantages of Challenger Banks: Growth and Adoption of Challenger Banks The appeal of these banks is evident in their rapid growth and adoption rates. According to industry reports, the global market for digital banking is projected to reach $8.5 billion by 2027, with challenger banks leading the charge. Many consumers, particularly millennials and Generation Z, are embracing these digital-first banking solutions, drawn by their convenience, transparency, and user-friendly interfaces. Traditional Banks’ Response to the Disruption Recognizing the threat posed by these banks, traditional banks are not sitting idle. Many legacy institutions are investing heavily in digital transformation initiatives, modernizing their systems, and enhancing their online and mobile banking capabilities. However, the challenge lies in overcoming the inertia of legacy systems and organizational cultures, which can hinder agility and innovation. Collaboration and competition As the financial services landscape continues to evolve, some industry experts predict a future where traditional banks and challenger banks will coexist and potentially collaborate. Traditional banks may leverage the innovative solutions and agile methodologies of challenger banks, while challenger banks may seek partnerships with established institutions to gain access to their extensive customer base and regulatory expertise. Adoption in Corporate Treasury While challenger banks have made significant inroads in the consumer banking space, their adoption in corporate treasury operations has been relatively slower. There are several reasons why traditional banks still dominate the corporate banking landscape: However, as challenger banks mature and expand their offerings, they may gain more traction in the corporate banking space. Some corporations, particularly those with a strong focus on innovation and digital transformation, may be open to exploring partnerships with challenger banks. This can potentially leverage their agility and customer-centric approach. Conclusion The rise of challenger banks is reshaping the banking industry. But their adoption in corporate treasury operations has faced unique challenges. Digital-first institutions continue to evolve and broaden their capabilities. They may gradually gain a stronger foothold in the corporate banking sector. Fostering healthy competition and driving innovation across the entire financial services landscape. 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 to get more information. Notice: JavaScript is required for this content.

Mitigating Banking Failure Risks: Strategies for Treasury Teams

This article is written by TIS Payments in 2023 At-a-Glance: So far in 2023, there have already been several high-profile institutional banking failures including Silicon Valley Bank (SVB) and Signature Bank, as well as the sudden acquisition of Credit Suisse by UBS. Uncertainty regarding First Republic Bank and other various regional banks has also persisted as a sustained liquidity crunch threatens their daily operations. These unexpected incidents have underscored the need for treasury and finance teams to develop and maintain a bank connectivity structure that supports their need for simplicity, automation, and control without creating an overreliance on any single partner or relationship. In the modern technology era, a popular strategy for accomplishing this is by deploying a multi-bank connectivity solution that is not tied to any specific bank and that can synchronize workflows across a company’s global banking partners by integrating them all through a unified platform. This approach enables treasury and finance practitioners to easily maintain global visibility and control across their full spread of bank connections and accounts, and it enhances their ability to quickly react and pivot to a shifting financial landscape as various bank relationships, regulations, integration methods, financial messaging standards, and other components evolve. Uncertainty in the Banking Environment is a Huge Deal for Treasury & Finance Teams During Q1 of 2023, tepid performance across the financial markets has done little to dispel widespread feelings of uncertainty about the state of the global economy. With the aftermath of the Covid pandemic still fresh in everyone’s mind and many companies now facing subsequent supply chain bottlenecks, heightened geopolitical turmoil, and rising interest rates coupled with soaring inflation, it’s easy to see why risk management has remained top-of-mind for many industry professionals. But recently, the added uncertainty and turmoil caused by a series of high-profile banking failures including Silicon Valley Bank (SVB) and Signature Bank, as well as the sudden acquisition of Credit Suisse by UBS, have sparked even greater worry over whether the global economy can handle further financial duress. Today, these concerns are weighing particularly heavily on those operating within the corporate treasury and finance arenas. Why is this? From an operational perspective, treasury is typically responsible for monitoring and controlling their organization’s banking workflows, account balances, payments activity, and underlying cash flows. Practitioners usually approach these responsibilities by attempting to automate and optimize as much of their processes as possible to drive efficiency and simplicity, but there is often a risk management element associated with the function as well. That is, addressing the risk that any of the company’s banking partners, account balances, or associated cash flows could be impacted by an adverse event or unanticipated scenario that suddenly drains liquidity or renders some or all of it inaccessible (i.e. due to a fraud attack, natural disaster, geopolitical conflict, economic catastrophe, etc.) In many cases, the bank relationships that treasury oversees are spread across numerous countries, currencies, institutions, and accounts. But, there are usually a few core banking partners that help companies manage the bulk of their liquidity and payments activity. Often, having these core partners is helpful because treasury can rely on them to sustain daily operations without overcomplicating their business landscape or having to deal with dozens of separate providers and connections.  However, if one of these core banking partners were to unexpectedly fail, how would that impact the organization’s payments and cash flows? Would it be easy to redirect these processes through a new bank, recover the liquidity held in the collapsed bank, and develop a new workflow to transact with vendors, customers, and partners in an efficient manner? Given the critical nature of payments and cashflow activities for supporting day-to-day business operations, treasury could end up dangerously short on options if a bank closure prevented them or their AP and HR colleagues from paying supplier invoices, debt settlements, or employee salaries. If millions of dollars in cash or more is suddenly unavailable and payments are not being executed, companies without the proper bank contingency plan will face significant challenges trying to source alternative liquidity and route it through new networks or channels. Treasury Must Balance Their Need for Banking Automation & Simplicity with Risk Management Best Practices Via Ample Diversification & Integration  For many organizations, addressing the above risks is not easy — especially not for treasury groups that have become overly reliant on a single banking partner or a select few institutions to manage cash and payments. And for companies still using individual bank portals to manage the bulk of their payments activity with their partners, then a bank closure impacting one of these key institutions is even harder to overcome. Of course, the “surface-level” response to this challenge is to simply suggest that treasury should diversify their assets across a greater number of banks and accounts. But the answer is not that simple. Over time, each new bank and set of accounts added by a company will result in greater complexity across the back-office as additional connections, data, information, and relationships must be managed. In the long run, a company that overdiversifies their relationships across too many banks and accounts will ultimately suffer from a garbled mess of bank portals, payment workflows, and reporting gaps that negate any benefit derived through the reduction in risk. In fact, they may even create added risk due to an increased threat of fraud and compliance gaps as cash and payment activity is spread across more points of exposure. But given the extent that modern treasury teams must rely on their banking partners to ensure cash flows and payments are properly transmitted and orchestrated on a global scale, how are practitioners supposed to adequately protect against the potential fallout of a banking failure without growing overdiversified, siloed, or inefficient in the process? For a growing number of companies, the answer lies in multi-bank connectivity solutions. Using a Multi-Bank Connectivity Solution Enhances Treasury’s Ability to Orchestrate Global Cash Flow, Payments, and Liquidity During Times of Crisis In today’s digital and fast-paced financial environment, an increasingly common practice amongst treasury teams is to…

An Interview with Benjamin Defays, Board Member of Treasury Masterminds

An Interview with Benjamin Defays, Board Member of Treasury Masterminds

Q: Let us know you, Benjamin. Tell us a little bit about your journey into treasury. How did it all begin for you? I landed in Treasury by chance about 12 years ago, and it quickly became my passion. I started my journey with a CAC40 company, then switched to the largest private company in the US, and now I’m with the world’s largest alternative asset manager. This gave me the opportunity to take part in 3 TMS implementations, plus one for a trade finance platform. And also FX risk, liquidity management, and solution implementation with various cash pooling structures, trade finance activities, and credit and collection management. I was also in charge of automation activities such as RPA and various workflow tools to help monitor activities and measure performance, with managerial roles at different levels. I have been a board member of the Association of Corporate Treasurers of Luxembourg (ATEL) for several years, in charge of education and the sustainability of the Treasury function. I teach and co-founded various Treasury Management training programs. Q: What specific skills do you believe are essential for success in treasury management, and how have you developed and utilized these skills throughout your career? In the evolution of treasury management, there has been a transformative shift from the traditional perception of treasurers as detached consultants to an integral part of strategic decision-making within organizations. Today, successful treasury management demands a multifaceted skill set that extends far beyond conventional financial acumen. At their core, treasurers function as risk managers, meticulously navigating the complexities of financial markets to safeguard the company’s assets and ensure stability in volatile environments. However, they are also indispensable strategists, adept at aligning treasury initiatives with overarching business objectives to drive growth and profitability. Hyper-specialization is crucial in today’s dynamic landscape, where treasurers must possess an intricate understanding of various financial instruments, regulatory frameworks, and technological advancements. This expertise empowers them to optimize liquidity, manage funding efficiently, and mitigate risks effectively. Moreover, treasurers serve as trusted advisors to the CFO and the board, offering invaluable insights into financial performance and implications for strategic decision-making. They act as liaisons between different stakeholders, synthesizing complex financial data into actionable recommendations that drive informed decision-making at the highest levels. In the modern business paradigm, treasurers are not just custodians of financial resources; they are strategic business partners, deeply entrenched in the operational intricacies of the organization. This requires a profound understanding of the business landscape and the ability to tailor treasury solutions to meet specific needs, thereby enhancing the company’s competitive edge. To excel in this evolving role, treasurers must embrace a culture of continuous learning and adaptability. The pursuit of lifelong learning is essential to staying abreast of industry trends, regulatory changes, and technological innovations. It’s not enough to rely solely on past experiences; treasurers must constantly challenge themselves to learn, unlearn, and relearn, positioning themselves as pioneers rather than conservators in the ever-evolving treasury landscape. Furthermore, effective communication skills are paramount for treasurers to articulate complex financial concepts in a language that resonates with senior management and other stakeholders. Clear, concise communication fosters collaboration and ensures alignment across different functions, facilitating informed decision-making and driving organizational success. Lastly, while treasurers are adept at managing external risks, it’s imperative not to overlook the importance of managing internal risks, including career development and professional growth. By proactively investing in their own development, treasurers can future-proof their careers and remain indispensable assets to their organizations. In essence, the modern treasurer embodies a blend of financial expertise, strategic vision, and adaptive leadership, playing a pivotal role in shaping the financial health and strategic direction of the organization. Q: In your opinion, what are the most significant challenges facing Treasury departments in today’s business environment, and how do you approach addressing these challenges? In today’s business world, Treasury departments encounter significant challenges. As highlighted by Charles Darwin’s insight: ‘It is not the strongest of species that survives, nor the most intelligent, but the one most responsive to change.’ Woodrow Wilson’s remark, ‘If you want to make enemies, try to change something,’ underscores the resistance often faced when change is introduced. The primary hurdle for Treasury departments is adapting to change effectively. We must recognize that change is inevitable and view it as an opportunity for growth. Embracing change involves thinking outside the box, avoiding routine, and seeking innovation. Automation is key to addressing routine tasks, allowing us to focus on strategic initiatives. By adopting agile, digital solutions and streamlining processes, we can improve efficiency and resilience. Standardization, simplification, and strong internal controls are essential for ensuring financial integrity. Furthermore, treasurers must enhance their business partnerships and technology skills to meet evolving demands. This includes leveraging data analytics for insights and collaborating across departments. As the role of treasury expands, we must adapt to new responsibilities such as managing working capital, addressing ESG considerations, and navigating emerging payment methods in B2C transactions. By embracing change, utilizing technology, and expanding our skill sets, treasurers can successfully overcome challenges and drive organizational success. Q: Could you discuss a particularly complex Treasury-related problem you’ve encountered in your career and how you navigated through it to achieve a successful outcome? I encountered a complex challenge revolving around the management of thousands of bank guarantees annually. This activity was pivotal for our operations, as it was a prerequisite for receiving payment from customers, many of whom demanded bank guarantees. However, this process was draining our working capital and causing frustration and misunderstanding within the organization. Managing over seven credit lines with predominantly manual processes meant our Treasury team spent excessive time on low-value tasks, with little visibility for management due to the absence of key performance indicators (KPIs). To address this, I prioritized breaking down the barriers between the Treasury and the business units. I initiated several team-building sessions, drawing insights from relevant literature, to foster mutual understanding of the intricacies and risks associated with bank guarantees. This collaborative approach significantly improved communication and…