“Is a robot going to take my job?” According to research conducted by the online marketing company SEM rush, 197,800 people typed this question into their search engine every month in 2017.
A widely-referenced study from Oxford University suggests that 35% of UK jobs are at risk of being replaced by automation in the next 20 years. Treasury professionals might not be looking over their shoulders quite yet, but with research suggesting 81% of businesses are currently investing in or planning to invest in AI, questions are beginning to surface about what the future holds for the future of the corporate treasury department.
When change happens quickly it creates a healthy tension that is in equal parts hype and fear. More often than not it is somewhere in between. A sense of perspective is important. And for that, you could do a lot worse than take a look at the history books.
When Dan met Bob
Back in 1978, a guy called Dan Bricklin came up with the idea of an electronic spreadsheet while he was daydreaming in class at Harvard Business School. Having built a basic prototype on his Apple II personal computer, he turned to his buddy Bob Frankston to add in a little extra finesse. Together, they came up with VisiCalc, which over time evolved into what we now know as Excel.
Almost overnight, a process that typically took a team of clerks hours to complete, could be done in a matter of minutes. Most people were delighted. But there was also fallout. From 1980 to the present day around 400,000 accounting and book-keeping jobs disappeared. There just wasn’t enough work for armies of data entry clerks.
Short-term pain, long term gain
Something else happened though. Accounting services became cheaper, and as costs fell, hiring a full-time finance department, and buying more consultative services from outside firms became more accessible to more businesses. The market saw an opportunity and it took it. So the loss of those 400,000 clerk jobs turns into more like 600,000 accounting jobs. And those accounting jobs pay a lot more than those clerk jobs that were lost.
We can see many of the same characteristics of disruption, evolution and opportunity in how AI and machine learning are impacting the treasury function. One of the biggest changes to hit the treasury function has been digitisation. Teams can now automate many of the process driven tasks that used to dominate swathes of time.
Be prepared to evolve
As more treasury departments digitise, entry level jobs are being eliminated due to automation and centralisation. Traditional skills and deep knowledge of underlying processes are giving way to a dependency on automation for transaction processing and reconciliation. Depending on what makes you happy, this is either an existential threat, or something far more empowering.
Automation is great at low value, laborious tasks, but it’s far less adaptable to more complex, strategic tasks where humans outperform computers. If you’re a junior clerk, or someone who simply loves data entry, then your days may be numbered. But if you’re willing to become more strategic, more collaborative across departments and ultimately more visible within the business, technology is there to help you do work that is ultimately more valuable.
One of the fundamental benefits of digitisation is the ability to capture, store and access data in real-time. As treasury continues to evolve, demand for process driven competencies will give way to a need for individuals who feel comfortable around the utilisation and analysis of data, the design of process flows, integration of vendor APIs and the associated user experience surrounding how the rest of the organisation inputs and receives outputs from treasury.
Seeing the bigger picture
The basic structures around accounts payable, procurement and treasury will be organised very differently in the future than they are today. If you look at how organisations are typically structured today, there’s a real disconnect between the different functions, particularly when you’re talking about procurement, accounts payable and treasury.
Each of these departments has started to digitise, but broadly speaking that’s been happening within the silo of each department. As organisations start to move to a future where everything is digital as a default, you need to flip that mindset and start thinking about platforms and processes which connect that whole set of departments end to end.
A good example of this is the relationship between procurement and treasury. Whereas today treasury teams often struggle to look at the bigger picture beyond the immediate confines of their business, digitisation will give them a far broader insight into the wider enterprise ecosystem, including the health of relationships with suppliers.
Having that level of transparency and insight will enable treasury to play a far more proactive role in minimising the risk associated with losing a supplier by offering financing options such as dynamic discounting or trade finance.
Demand for softer skills
Building bridges across departments will not happen overnight, and it will take more than just technology. Softer-skills will be highly sought after as digitisation encourages greater collaboration, but the reward for this is a department that sits at the right at the heart of everything happening and has a big say in the company’s strategic plans.
The next decade will not always be rainbows and unicorns. The best technologies are there to disrupt and challenge the status quo. But anyone who thinks that technology is out to replace us could do a lot worse than pick up a history book for a glimpse of the future. The robots might be on their way to an office near you, but they’re coming to help you look good.