When you hear the name Western Union, most people will know the that the organization specializes in cross-border, cross-currency money movement. Yet, few will know just how big the company is. For example, with over half a million agent locations globally, it’s larger than all the Starbucks and McDonalds combined. What’s more, as the company continues to innovate, digital transactions handled by the firm have been growing in the double digits for several years, and now represent 12% of the business.
As you can imagine, this means the treasury function within Western Union is large and extremely complex, which makes transformation no easy job. Despite the challenges, however, the organization is a model of transformation success that other treasury departments can learn from.
When asked what prompted the organization to commence an ambitious transformation of its treasury function, Brad Windbigler, SVP Treasurer – part of the leadership team orchestrating tech-led change – says the need was pretty obvious.
“The running joke in my team is that I can’t hold down a steady job – I’ve worked in a variety of strategy, M&A and investor relations roles, which means I came to treasury in 2015 with multiple perspectives. Quite honestly, it was the diagnosis of what I perceived to be untapped potential that prompted me to transform the way we worked in treasury. I’m kind of a data driven guy, so I could analyze that side of things and see where we could develop for the good of the organization, but it quickly became apparent that we had a lot of talent in the team that wasn’t being utilized. That really stuck out.
“I concluded that we had a lot of linear professionals, people that were treasury experts, but hadn’t been told to look up and out, and think about the ways in which our industry is changing, and how we need to respond. At the same time, I would say, circa 2015, we were seeing continued acceleration of digital payment methods in our markets. By combining the views of treasurers with the demands of our customers we had a real opportunity to reinvent the treasury function. As a business we’d reinvented ourselves many times, right from the days of the telegraph, to now dealing with small- and, medium-sized businesses now dealing with people who aren’t even trying to solve remittance problems!
“All this was going on at the same time that I was stepping into the role, and I recognized that I had to start the transformation by understanding how to re-engage the team. It became a focal point for me immediately, followed by trying to break down the problems that existed.”
Brad commenced delivering his changes by introducing a new, carefully selected ethos – one called entrepreneurial leadership. His approach to transformation is also to focus on making the program voluntary.
“I chose those words very carefully because it captured the spirit we were going for – spirit within an existing environment, one where an entrepreneur responds to other customers. It doesn’t say, here’s the product, take it or leave it. It’s about being more flexible. It’s about understanding what you’re solving and getting to the heart of use cases beyond what we’re wired to do already. Using the Western Union business as an example, it’s like our new partnership with Amazon for cash payments for cross-border e-commerce. It’s not our traditional business, but it’s still about cross-border payments, it’s still a problem that we’re solving and there’s still commonality there.
“What I’ve done, from a pure team perspective is to make the program voluntary. Compulsory programs don’t get the right people engaged, in my opinion. I’ve got 290 people in my teams; of that group 43% opted to be involved in multiple parts of our program. We then take these people and get them talking in small groups. I get up on stage preach occasionally, but that’s not where the real learning happens. The real key, I think, is having a group of motivated people that are really embedded in the spine of the organization. They need to see the transformation taking shape every single day. They need to see what gets reported and recognized. Calling out what is good and ensuring others hear about the good work encourages them to get on board, voluntarily. It’s perhaps more of a corporate view than one usually taken by treasury teams, but it has worked for us.”
Just doing it
With the people side sorted, how did Brad overcome one of the other major challenges treasurers often cite when discussing barriers to transformation – the buy-in from above?
“I didn’t ask! I just went for it,” explains Brad. “That was daunting, for sure. I’m not an HR professional. But the learning that I’ve picked up across my career is that HR really is job leadership. So, my buy-in was I’m just going to self-fund. I wasn’t asking for resource. I was creating a time for my team. We wanted to go out and create, hopefully, a success story that others would want to be a part of.”
“The main themes revolve around the workstation, so you have to fundamentally invest in technology to keep these up-to-date”
The other issue that we hear quite a lot when people are putting off making any kind of digital investment is that treasury performs a role that cannot go wrong – and therefore the potential risk of software integration or outages holds back transformation. Brad, however, sees standing still and failing to make change as a bigger risk.
“We’re fundamentally risk managers, so, in many ways, the hesitation is understandable. However, at the same time you can’t stand still. The narrative five years ago was all about treasury workstations. It’s been that way for a while. What do those systems do? They give you one platform to manage and quantify your risk, whatever you’re focused on, which for us is cross-border payments and foreign exchange, alongside the launching of payment files and anything in our capital structure. These main themes revolve around the workstation, so you have to fundamentally invest in technology to keep them up-to-date and effective for your business. Yet, I still hear stories of people that are working off direct connections to banks, or websites, which would be concerning to me – far more so than the risk involved with modernization.”
People and skills in treasury transformation
While technology often takes center stage, at the heart of any digital transformation are people. What people-related challenges has Brad come across and how has he dealt with them?
“I think it’s about getting people engaged in the vision. How can we be different? What’s the opportunity when we talk about multiple things that are changing? It’s obvious to many, I would say most, that the industry is in a state of accelerated change. So, I think it’s, how do you connect people to be motivated to be part of that, so that we can improve ourselves. Change is just hard. It’s about showing the vision of what the company can be, coupled with being more flexible. And understanding how our systems can be set up in a certain way that has to be more flexible to serve a broader function.”
When asked where skills and education of existing staff come into this, Brad answers: “When I think about my own world within treasury, I ask what are the things we can do to save hundreds of hours of time, so that our risk managers can focus on risk, for example, not data input and organizing?
“It’s about showing the vision of what the company can be, coupled with being more flexible”
“We use software like Alteryx that helps us with workforce automation. We program a tool to go fetch the data from multiple systems, massage that data and process it, which would have taken a number of humans hundreds of hours. Those types of technologies are really critical, because it’s not like people have an abundance of free time. It’s about prioritizing time in a very practical way. You need to start there. The first wave of our journey is all about workflow automation and the use of robots as a tool.
“Once that’s clear, it’s mostly about demonstrating how we’re investing in people’s time, so they have more value. Yes, people probably wonder whether they have the skills required in the ‘new world’, but by creating a positive vision through what we do, led by local teams, as opposed to me preaching it, we build trust. And that’s really the make or break of transformation.”