An article published in the Harvard Business Review extolls the benefits of building barns the old-fashioned way, when all the local farmers would gather to design, build and then collectively 'raise' the structure. To innovate in the modern business environment, we should take a leaf out of the barn-raisers' book, say the authors of the article To Innovate, Think Like a 19th-Century Barn Raiser. They write: “Barn-raising can serve as a model for successful new value creation in today’s hyper-connected world.” So, how could this work in the treasury environment?
Leveraging community intelligence
The authors argue that leveraging community intelligence can significantly improve the design of the project, given the range of views, skills and expertise that have contributed during the creation phase. So, whether it's raising a barn or introducing a new treasury system or process, reaching out to the wider community allows you to tap resources and wisdom that might not be available in your immediate team. One thing to note is that, in order to achieve the best results, you really need to reach out to all relevant stakeholders before plans for the project are finalised and set in stone. The design and ideas need to remain flexible in order to absorb and adapt to suggestions from those in other business units (as well as consultants, end-users, providers, clients, etc).
The authors, John Geraci and Christopher Chavez, write: “Too often, new initiatives – especially in big organizations – are developed through a series of inward-facing brainstorming sessions, which are designed to capture the core team’s thinking on the subject. Too often, proposals that look great in PowerPoint turn out to be unappealing, unhelpful, or unworkable to the people whom the success of an idea ultimately depends.”
This is one of the pitfalls of large treasury implementation projects and experienced treasurers who have been through large treasury transformation projects, such as a centralisation process or an SAP implementation, for example, emphasise the importance of planning and managing a large number of people. While support from the board is often cited as a crucial factor in large projects, the HBR authors make a convincing case for gaining support and listening to voices at all levels and with different skills within the company.
A logical step on from initially engaging the wider community in a proposed project is that this creates and reinforces the collaborative connections that, the HBR authors argue, are “crucial for success”. They give the example of crowdfunding websites such as 'Kickstarter', which, on the surface at least, seem to be all about raising cash for a new venture. However, such websites also serve as marketing for the idea and to test the water to see how people respond to the embryonic initiative. In short, reaching out to the wider community can also build “the channels and connections you will need for sustained growth”. From a treasury point of view, gaining support and investment (not just financial) in a treasury initiative will establish the right contacts across the organisation that will make the project more likely to succeed in the long term.
Growth of the ecosystem
Geraci and Chavez also give the example of the Clinton Global Initiative (CGI), which is able to operate successfully and enact change by prioritising growth in the ecosystem as well as through the initiative itself. They write: “Rather than solving problems by focusing solely on ideas for solutions, CGI focuses first on ecosystem development. The organization convenes heads of state, corporate leaders, members of academia and media; outlines initiatives broadly; asks participants to make a commitment to action on the initiatives; then facilitates dialogue and partnerships to enable solutions to emerge and take root.” They note that CGI doesn't come up with the ideas nor the resources for any given initiative; CGI simply convenes and facilitates. This is an interesting approach that could potentially lead to innovation for treasury, if one thinks of the 'ecosystem' as being the expertise within an organisation (including IT, tax, accounting, sales, payments, and so on). Could some innovative solutions be achieved by convening and facilitating discussions between different groups? It goes against the much-repeated idea that modern treasury has to be in the driving seat and yet it could help to foster new ways of approaching matters. The authors note that: “The barn-raising approach purposely and actively elevates community, connection, and a diversity of viewpoints above ideas and individuals.”
CTMfile: These ideas go somewhat against the modern mantra that treasury has to be in control, guiding the company's financial strategies. Of course, treasury transformation projects need strong leadership and decisions can't always be taken effectively with the committee approach. Nonetheless, reaching out to the wider community of stakeholders to gain valuable input and creative ideas, as well as fostering supportive contacts throughout the business and also encouraging people with diverse areas of expertise to discuss solutions, are all strategies that could benefit treasury.
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