Supporting Business Growth by Knowing Who’s Your Customer, Keeping Up with M&A, and Embracing Technological Disruptions

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Supporting Business Growth by Knowing Who’s Your Customer, Keeping Up with M&A, and Embracing Technological Disruptions

The Asia Treasury Peer Group met in Hong Kong for the first time on October 24-25, hosted by Emerson Electric. Members discussed their projects and priorities and local bank partner challenges, heard from a guest speaker on setting up a treasury vision and values to align with the business and about online third-party payment providers.
 
We also heard from a visiting US NeuGroup Network member on transforming treasury for the digital future and received an update
on Hong Kong’s corporate treasury centre incentives from the Hong Kong Monetary Authority (HKMA). Here are some highlights: 
 
Who’s Your Customer? Our special guest from a China-based MNC led a session on how treasury partners with business units to help drive growth that turned into an existential exploration of treasury’s broader mission and the related need for treasurers to answer the question who is treasury’s real customer. Identifying one’s core customer is an extension of determining what role treasury plays in the broader corporate organization and whether the tack it takes in managing cash and financing is largely geared toward promoting sales and supporting business units, or driving a more controlling strategy focused on compliance, policy and governance.
 
Solving the “M&A Integration” Equation. This is a case where one size doesn’t fit all and where priorities including growth and the pace of acquisitions must be weighed against what treasury’s control and compliance policies may dictate. Nonetheless, treasury needs to develop a systematic approach to integrating newly acquired companies into its finance orbit and to communicate with the new unit quickly and clearly. The plan needs to reflect the realities of how long it takes to integrate policies and data and whether the pain of changing bank accounts and other systems is worth the cost right away. Many companies will find selective integration is the best path forward, giving business units flexibility (not autonomy) and maintaining treasury’s supervisory role to ensure compliance and control over acquired companies.
 
Technology Disruptions - Digitalization and Online Third-Party Payment Systems. The group watched a demo on how easily machine learning and chatbots can be incorporated into the treasury toolkit and what this means for team skill development and treasury roles going forward. Whether it’s developing apps to improve cash flow forecasting and FX exposure analysis or using online third-party payment systems, treasury needs to drive the process of embracing the innovations that are coming fast and furious in the digital age. Treasury can burnish its strategic role within the organization by keeping abreast of fintech developments, assessing which ones make sense to discuss with senior management and by making a strong case for using internal resources or utilizing external sources to tap into advancements that are transforming business models and how treasury does business.
 
Outlook
The viability of regional treasurers in Asia depends on companies ensuring treasury contributes strategic value to business units in a region that contains both challenging frontier markets and the world’s largest population. The key to creating compelling treasury career paths within western multinationals is better integration with business units in Asia. Focus should be put on developing the skills required for evolving treasury roles, as departments face increasing pressure to centralize traditional activities and to use technology to do transaction processing. 
 
For more than two decades, NeuGroup has led the way in peer knowledge exchange for treasury and finance professionals. With an unrivaled network of 18 invitation-only peer groups, NeuGroup facilitates over 30 face-to-face meetings to inform actions, transform practices, and enhance careers for more than 400 members from across treasury and finance functions, covering multiple industries and global regions. Visit www.Neugroup.com for more information about peer groups and www.iTreasurer.com for content and news.
 
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