Raising the treasury department’s digital acumen

CFOs and treasurers are focusing more on technology improvements and digital innovation compared with results in our 2019 survey. The primary investment targets — gaining efficiency and generating more impactful insights — point toward organizations laying a foundation to support an ultimate vision of enabling treasury-on-demand services.

Half of the respondents tell us they’re working toward this vision of a connected ecosystem that leverages advanced capabilities and analytics to empower CFOs and treasurers to make financial decisions in real time. The pandemic underscored the need for real-time treasury data and insights as teams responded to intense cash and liquidity challenges while working remotely.

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Clearly, many departments accelerated or maintained their digitization efforts over the past year: Just 30% of respondents now say they’re poorly or somewhat poorly positioned to manage significant adaptations to company strategy caused by economic shifts. Departments continue to focus on data analytics, robotic process automation (RPA) and visualization tools to drive digital transformations and demonstrate the value of Treasury technology investments in supporting a broad range of activities. Data analytics and visualization tools are continuing to help treasury furnish insights quickly in support of cash and liquidity, working capital and risk management, with enhanced RPA supporting manual and/or redundant activities in areas such as payments, collections and reconciliation.

In general, departments do not appear to be at the point of a wholesale connectivity transformation, but findings show that the build-out is underway: 90% of respondents expect application programming interfaces (APIs) will be relevant in their function in the next two to three years. These are software tools that can connect systems and share data, and support real-time connectivity between corporates and banks to help treasury departments to further deliver value while saving time and money.

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Implications: Left unattended, outdated tech and data quality issues will hold back visions of a connected organization

Almost half (45%) of respondents cited “lack of technology” as a key challenge. This issue often relates to sparse data and/or insufficient data quality checks within the upstream systems, resulting in a knock-on effect that hampers accurate forecasting.

Overall, respondents see two main challenges to implementing new or upgraded technology: budget constraints (61%) and the need for relevant skills (57%). These concerns are common across business divisions, but treasurers may find more support if they can make the case for fast-rising business priorities. API investment, for example, is most relevant in cases where direct connectivity to data sources can help drive accurate inputs into forecasting and decision-making.

Five priorities for corporate treasury

Delivering on the promise of business partnering

Expect the on-the-spot relationships developed during the crisis to continue and significantly expand as companies focus more on cash flow optimization and those in business development, capital management, operations, finance, tax and other functions tackle new challenges.

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Raising digital acumen to accelerate technology adoption

The cloud foundation required to make greater use of automation and artificial intelligence (AI) — and deliver on treasury-on-demand real-time service — is taking shape. Simultaneously, the required skills and capabilities are changing, and the focus on cyber risk is at an all-time high.

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Supporting business leaders driving ESG

Environment, social and governance (ESG) matters are affecting lending, investments, supply chain finance programs and other areas that go well beyond reporting.

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Responding to demands to optimize cash

Reducing the number of bank relationships and bank accounts — including through advanced liquidity management techniques, such as in-house banking, and on behalf of structures — is a part of an overall streamlining agenda to strategically optimize cash and improve the customer experience.

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Sharpening the focus on financial risk

Risks stemming specifically from LIBOR transitions are on the radar as well as in foreign exchange (FX) management as a result of business disruptions and pressure on margins.

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About the survey

PwC’s 2021 Global Treasury Survey report reflects the views of 340 treasury department respondents contacted by the PwC global network from February through May 2021. The respondents are based in over 30 countries, across 22 industries and in companies with median annual revenue of $4 billion. The report also relies on insights from our global team of treasury function experts. 

Contact us

Eric  Cohen

Eric Cohen

Principal, Financial & Treasury Management, PwC US

Tel: (646) 246-7744

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