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Benjamin Defays : Balancing Innovation with Fundamentals for Lasting Value 

In the fast-paced world of finance and treasury management, the landscape is constantly evolving with new technologies and trends. As a treasurer, you're inundated with terminology and buzzwords, yet may find yourself unsure of how to effectively leverage these tools to drive value for your organization. If you've ever felt this way, rest assured, you're not alone. 

"Building a solid foundation is key" 

It's essential to acknowledge that building a solid foundation is key before diving headfirst into the latest innovations. While AI, automation, and other advancements hold tremendous potential, they are most effective when built upon a bedrock of fundamental principles. 

Far too often, treasurers become fixated on adopting the latest technologies without first understanding their business inside-out. This includes meticulously documenting operations, identifying inefficiencies, and implementing strategies for improvement. Creative destruction, the process of eliminating outdated practices to make room for innovation, is a powerful tool in this regard. Consider the multitude of reports that consume valuable time and resources without clear utility—a prime target for streamlining efforts. I will always remember a great (and rather simple) advice from a former boss who I asked whether this and this report was really needed: "Stop doing it and see what happens. If nobody comes at you, it means nobody cares!" I followed his advice which saved 2 days of work every week for my team. Of course, I wouldn't apply it without thinking if I was you. Ask around you before stopping a reporting activity. 

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"Without a solid framework in place, even the most advanced tools may yield limited results" 

Prioritizing initiatives such as business continuity planning (BCP), staff education and training, and establishing clear roles and responsibilities within the treasury function are essential precursors to technological integration. Without a solid framework in place, even the most advanced tools may yield limited results. 

Once these foundational elements are in place, treasurers can begin to optimize their existing processes using a combination of technology and strategic planning. Implementing workflow tools to manage end-user requests, developing key performance indicators (KPIs), and establishing your own BIC for enhanced banking relationships are all steps in the right direction. 

"Treasurers can unlock significant efficiencies and cost savings" 

A treasury management system (TMS) serves as the linchpin for many of these optimization efforts, providing greater visibility into cash positions, improving payment management, and facilitating intercompany transactions. By centralizing cash management and leveraging in-house banking capabilities, treasurers can unlock significant efficiencies and cost savings. 

In the realm of foreign exchange (FX) management, transitioning from direct bank trading to an FX platform offers enhanced pricing, transparency, and security. These platforms seamlessly integrate with TMS systems, further streamlining FX transactions through automation and advanced reporting capabilities. 

"Treasurers can unlock valuable insights" 

As treasurers continue to modernize their operations, artificial intelligence (AI) and application programming interfaces (APIs) emerge as powerful tools for enhancing cash forecasting and integration with internal systems. Leveraging machine learning algorithms, treasurers can unlock valuable insights into cash flow patterns and optimize liquidity management strategies. 

API integration extends the capabilities of TMS systems, enabling seamless communication with other critical systems such as data hubs and ERP platforms. By aligning treasury functions with broader data strategies and automating accounting entries, treasurers can drive operational efficiency and ensure compliance with financial reporting standards. 

In essence, the journey toward financial transformation requires a strategic approach that balances innovation with foundational principles. By prioritizing operational excellence, leveraging technology strategically, and embracing continuous improvement, treasury professionals can navigate the evolving landscape with confidence and drive lasting value for their organizations. 

To conclude, walk before you can run! 

 

Benjamin Defays, Senior Associate Vice President, Treasury / ATEL board member 

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