Asia growth often means expanded role for local treasurers.
Asia over the past several years has seen phenomenal growth and companies there are doing their best to keep up. And with this is growth is the idea that treasury can do more (and likely the concurrent trend of doing more with less). This was a topic at The NeuGroup’s recent Asia Treasurers’ Peer Group (ATPG) held in Singapore.
Members of the group readily admit they manage cash management and do other necessary treasury operations, especially as cash levels have increased amid Asia’s boom. But now more members are gaining additional activities; for instance, one of these activities is business support. This can be offered in the way of spreading the gospel of cash management and showing the BUs where they stand in the cash cycle or through sharing expertise (or an FTE or two if necessary) in data analytics or just general number crunching of a strategy.
Also coming to the fore is reconciling the regional treasury role with the growing strategic importance of Asia in the business of most every multinational. Asia treasury centers are not forgotten and forlorn outposts. Why? One reason simply is cash. With growing cash levels, and the fact that this cash is being generated in Asia; and that investment opportunities there are bearing the highest returns, means that cash-rich companies may need to rethink the balance of cash investment decision-making between head office and Asia treasury. This will require treasury to step up to the task and become more of global player (thinker) within the organization.
This brings up the issue of geographical expansion. In other words, sitting in a regional treasury center can often bring with it more than a regional focus and successful regional centers are able to balance global, regional and local treasury responsibilities. For example, several members of the ATPG have responsibilities for global scope activities where regional centers are also global centers of excellence for key activities.
Several members also noted business support responsibilities for business units on the ground in regional countries. In the case of one member, a recent reorganization has created a local treasury matrix whereby she becomes primarily responsible for ensuring local business units in the region receive the treasury services, advice and financial support they require, while also adhering to global standards in processes and procedures affecting treasury. Another member highlighted the concept of business treasury roles, similarly designed to ensure local business units are properly supported as treasury centralizes into regional and global treasury centers, as the case may be.
Overcoming the pressures from local practices, people on the front lines of the business, and the customer to do what is better for the company on a global scale can take a great deal of tenacity and boldness. But treasury in Asia has the benefit of seeing a big picture not seen at other levels, particularly as the region becomes the focus (and driver) of the company’s growth plan.
Presuming the business case and trajectory are supportive, it is the duty of treasury to look at the big picture and take the bold moves needed for the company, even when you are younger and newer than your counterparts.