A workflow is a series of tasks needed to accomplish a specific treasury-related goal , e.g. to open a bank guarantee. It typically spans a number of internal and external systems and involves different types of user roles/actors responsible for performing the workflow tasks needed to accomplish the goal.

What is a good workflow?

A good workflow has a number of characteristics:

• The user roles and actors within treasury (back office, middle office, front office, shared service centres, local entities, treasury operation, etc.) are reflected in the setup of the workflow. This ensures that each user role/actor only sees tasks relevant to them and nothing else (which prevents incorrect usage). A stringent assignment of specific tasks to user roles instead of individual users ensures that tasks can be easily shared within groups of users. New users are easily setup by simply assigning them to their respective role. Finally, using established user roles like back office, middle office, etc. also ensures rapid adoption of the workflow as it neatly fits into well-known paradigms.
• Communication between different systems involved in a workflow is handled using standardised electronic formats. Especially for external participants in a workflow, this is a must in order to avoid paper-based communication. This prevents errors that can occur if a document needs to be created or processed manually and will drive down process costs.
• The status of a workflow and the next step required as well as who is responsible for it will be transparent during every stage of the workflow. Each task is tracked and can be made available to internal and external auditors, including a full audit-trail of who did what at which point of time.
• It is crystal clear what needs to be done before a user can trigger the next action in the workflow. This not only ensures that the appropriate information is available in the later stages of the workflow but also avoids time-consuming ping-pong games between different actors in the workflow.
• KPIs measure if a workflow was completed according to expectations concerning execution time and makes it possible to identify process-related issues.
• The workflow actively communicates with actors in the workflow via email to notify them about the current status and if an action is required of the user. This is done in such a way that the user simply clicks on the information provided and is routed automatically to the relevant stage in the workflow.
• Last but not least, a good workflow is easy to follow for casual users and provides a fast and flexible reporting option.

Why will workflows change the way treasury operates?

There are essentially two reasons why this will happen and why it is already happening as you are reading this sentence.

• Treasury departments are under pressure to accomplish more with less. This means that every task that can be automated will eventually be automated in order to cope with the pressure on resources. Workflows make it possible to structure automation while also providing safety stops at critical points in the process.
• To prevent (internal) fraud, a clear separation of responsibilities, transparent accountability and a close match of daily actions to internal guidelines and regulations are a must. Workflows are a superb way to achieve this without being a nuisance to everyone involved. In fact, the opposite is the case.

What are some best-practice workflows already used by treasury departments?

I have selected two workflows that are already in operation at clients of ours that exhibit many best-practice characteristics.

• FX hedging/IFRS 9 reporting: Imagine a project-based business where all the project flows are maintained with the ERP system. These flows are integrated on a daily basis into the workflow. The workflow compares these flows against the current FX hedges and, based on the result and the hedging guidelines implemented in the workflow, suggests a number of hedges. These hedges can of course be adapted by someone in Treasury. The treasurer approves or refuses the hedges. Once approved, the hedge proposal is automatically sent to a trading platform where the trade is executed. The actual hedges are automatically returned and passed on to the TMS system for market valuation and made available within the workflow again. As the project number was passed from the ERP system to the workflow, to the trading platform, back to the TMS and finally again into the workflow, creating an IFRS9 report suddenly becomes a piece of cake and provides the documentation needed to bring a smile to every auditor’s face. This is a workflow! It spans several systems (ERP, workflow, trading platform and TMS), several actors are involved (the treasury employee and the treasurer), the systems communicate automatically with each other and, as an output, a report is generated. This is the kind of example that not only saves a lot of time but also prevents IFRS9 headaches.
  
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• Guarantee management: A local entity raises a request for a new guarantee and captures this request in the workflow using a simple web-based form. The treasurer looks at this request and either approves or refuses it. Approval is usually preceded by adding additional information such as which bank the guarantee should be opened with and, possibly, other accounting-related information. Once everything has been approved, a MT798 message is sent to the bank, processed there and a message is sent back to the workflow system. There, an automated comparison takes place between data sent and data received, and this is presented to the treasury employee in charge. Once everything has been done, the booking details are generated and passed on to the ERP system. Another nice example where all the data needed are only entered once and, after that, only approved and transmitted via electronic means. A real time saver and a great way to prevent errors! 

Other examples include the automated monitoring of bank fees, the management of bank accounts and authorised signatories, the management of access rights to various treasury-related systems, etc.

What remains to be done?

It is really painful to write this in the year 2018, but the biggest pain is still the adherence to standards for electronic communication and the acceptance of these formats by banks. If we look at the stages of a workflow, it is usually at banks where the process is interrupted, and an email, a signed document or a phone call are needed to move forward. All the other elements are in place. We have a wide range of properly defined electronic formats, we have system vendors that can create almost any of these electronic formats needed by Treasury, we have communication channels with SWIFT, EBICS, etc. to pass on these formats, we have cryptography to ensure secure communication via these channels…. 

What’s in it for you?

Workflows make your life a lot easier. They allow you to focus on functional tasks and will move the more technical aspects into the background. Workflows increase transparency as every piece of information gathered during a workflow is available at your fingertips. They also greatly improve your ability to communicate with your subsidiaries in a structured and well-documented manner.

Where is the big elephant in the room?

So far, I have avoided using the term digitalisation and its siblings. Naturally, workflows are at the very core of digitalisation as a workflow essentially digitalises treasury-related processes by automating tasks, by using automated interfaces and by employing standardised electronic formats. It will not come as a surprise that some workflow tasks can employ predictive analytics and artificial intelligence to accomplish specific tasks in the workflow. Communication between different actors and the documentation of their interaction and agreements can be facilitated by different means, with blockchain being one of the options in the toolbox. All the (big) data gathered within a workflow can be easily analysed using self-service BI or presented to Management using dashboards. No, I won’t mention cryptocurrencies, not this time.