Five Common Misunderstandings between Bankers and Treasurers
In the current corporate environment there are increasing pressures on treasurers with regulatory changes for control environments, thus requiring the development of integrated systems, centralized processes, timely and effective management information. Likewise, there are expectations of bankers to understand and meet the changing requirements of treasurers.
The serving of internal clients and running the day-to-day operations of a treasury have vast demands of treasurers’ time. Bankers often underestimate the complexities involved and, subsequently, misjudge the value of traditional banking products in solving the need of the treasurer.
With the increasing pressure on treasurers to centralize processes, systems and controls, there is a requirement of bankers to provide integrated solutions. Organizational boundaries, legacy systems, and “the way things have always been done” cultures in banks pose demands on bankers that are not always fully valued by the treasurers.
Bankers tend to underestimate the challenges that treasurer’s face in getting full visibility to data and in ultimately converting the data into valuable information supporting the broader organizational needs. Bankers assume that treasuries have been centralized to a high degree and do not understand that effective centralization of processes is organization wide and is highly dependent on systems integration and data aggregation.
Where a treasury is operating a TMS system or has undertaken a system implementation project, bankers tend to assume that the system meets the business requirements of the treasury. Bankers have a tendency to underestimate the complexity of integrating systems and processes to draw on data from multiple sources. The increasing pressure on clients to reduce costs often has repercussions on a client’s ability to implement and maintain complex systems, which is often taken for granted by bankers.
Treasurers have yet to realize the full extent of operational efficiencies, cost saves and strategic benefits that an organization can realize by leveraging the banks infrastructure, products, and data aggregation on a more comprehensive scale. As organizations redefine core competencies and reorganize there are increasing opportunities to leverage on the global operational platforms and infrastructure of larger multi national banks to allow them to gain operational and cost efficiencies together with alleviating resources.
The above five items are not an exhaustive nor definitive list of misunderstandings that can arise between bankers and treasurers. They are a summary of the common areas in which misunderstandings can arise due to increasing pressure on treasurers to maintain cost levels, comply with regulatory changes as well as increasing demands from internal clients, and on bankers to meet this changing environment.
Nerissa Dowling joined Citigroup Global Transaction Services EMEA in June 2004 from PwC. Her background is in Chartered Accountancy, Information Systems Auditing, Business Processes and Risk consulting. Nerissa currently heads up the Product Design team in the Treasury Services Group, based in Dublin.