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Experts Weigh in on the Digital Transformation of Treasury: Part Three

  • By Brooke Ballenger
  • Published: 9/20/2021

The coronavirus pandemic accelerated the momentum toward a digital-first strategy as companies sought to stay competitive and relevant. But what exactly does that mean? Seeking answers, AFP hosted a webinar, “Digitalization or Transformation: What's the Difference?,” where financial professionals from around the world discussed how they are handling the transformation and what it has meant for their organization.

In part three of a series of articles based on the discussion, we bring you the perspective and experience of Veikko Koski, CEO of FinanceKey.

Describe where your company started in its digital transformation.

Koski: My background in treasury goes back a long way. I used to work for an advanced treasury organization, where I learned from a wide range of technologies in the treasury space. As a treasury employee, I was very hands-on in the digitalization processes, especially on the foreign exchange risk management side.

Technology-wise, I have been embracing modern software and databases, application programming interfaces (APIs), and other integrations within existing enterprise IT and treasury systems. When I think about it from the perspective of my current role at FinanceKey, my focus is on corporate banking APIs and helping businesses take advantage of barriers.

This is where I see potential for APIs to be used in treasuries. I have experienced the benefits that instant access to banking data provides for a large corporation, enabling one to manage treasury in real time. There are many excellent use cases building up from real-time access to bank account balances and transactions in the required systems and instant payments, but also many use cases beyond treasury; for example, real-time credit limit updates or instant customer refunds. API is a cornerstone of the future for truly digitalized treasuries.

Not only the banking APIs but also the APIs connected to every system. For many treasuries the focus has been more on robotic process automation, which, while this certainly helps when automating the current state, it is something built on top of current banking methods.

Has this initial journey been a success, and what key lessons have you learned?

Koski: Digital transformation is a continuous journey that requires continuous adaptation. You need persistence and involvement of all levels of the organization in the transformation project, including full support from the top management. The successes I have seen have come through long-term investments and having the right people and the right skill sets committed to the change.

The lessons I have learned in my journey include the need to work closely with software developers, as every treasury employee can learn from modern ways of developing software; splitting larger projects into smaller deliveries and tasks; and providing a fast feedback loop to break silos and work as a team.

Our work does not stop when IT hands the tool over to us; that is when our work starts, when treasury employees can start innovating. As treasury teams continue with previous ways of working, it can be a pain point to get everyone on board with digitalization efforts and for employees to understand how they can benefit from it. Our jobs will not disappear any time soon, but we will get to do more value-added tasks that future-proof our careers during the journey.

What advice would you give other corporate treasury departments looking to start this digital transformation journey?

Koski: Treasuries are a promising ground for digitalization, as we work at the crossroads of many legacy systems and data. Employees need to switch between many interfaces, explaining why robotic process automation is popular in the treasury field.

It is more important for an organization to get started than to get digitalization tackled 100% correctly in the beginning. There are many things you will learn during the process. Start small and focus on the manual repetitive tasks that could be allocated to more value-added tasks, rather than wasting time and energy. The key is to provide the necessary tools and training for treasury employees and to learn the skills needed in the future.

Given the technologies you have implemented so far, what is next on your radar?

Koski: There is still a lot of work for treasuries to do. The “boring” items need to be in place first, including the mass data, quality of the data and system integrations. Once the base is there, treasuries will have an exciting future to build on, applying artificial intelligence (AI) and machine learning models to many old processes.

AI can make treasury more relevant for a business. Once you have more structured and connected data, especially if it is in real time, the more potential there is for intelligent process automation.

Read for part one and part two of this article series. Missed the webinar? Watch the full recording here.

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