The treasury community is expecting that technology will take up most of its time and attention within the next five years. Even in 12 months’ time, treasurers expect the time spent on technology will be second only to capital and liquidity management, according to the ACT’s The Business of Treasury 2024 report.
To put this in perspective, treasurers are saying that today (2024) they spend more time on operations and control, capital and liquidity management, risk management and business strategies than on technology. In fact, the amount of time currently spent on technological advances has declined since 2020, and flatlined between 2022 and 2024.
But now treasurers are expecting to spend less time on virtually every other aspect of treasury management compared with the previous two years apart from on technology. In 2022, 66% said they expected to spend more time on technological advances; this increases to 69% in this year’s survey. Meanwhile, today’s figures are lower for areas such as business strategy, risk management, and even capital and liquidity management compared with 2022.
The treasurers in the survey list a number of areas within technology in which they are planning to invest:
As the graph below shows, 80% say they are either investing a great deal or had started to invest in cybersecurity measures. This compares with 69% just two years ago. It is also interesting to note that the investment figures for treasury management systems (TMS) have fallen from the 45% in 2022 who said they are either investing a great deal or have started to invest in a TMS, to 39% in 2024.
AI and machine learning have seen a similar fall, although this year’s survey also asked about generative AI, with 25% saying they have now started to invest in this new technology.
However, these various aspects of technology should not be seen in isolation. While investment in working from home (WFH) technology may have decreased over the past two years, for instance, the focus could have shifted to ensuring the ongoing security of those logging into the enterprise’s network.
As one treasurer puts it: “Remote working – I think that’s really the primary reason, and cybersecurity as well. The impact is that it’s allowing people to work comfortably at home, and securely.”
Another says: “I see an opportunity more than a challenge, but the issue will be with the increasing cyber threats.”
Concerns are being expressed about the impact of this rise in technology on job security. One treasurer recognises the potential for greater efficiencies and the impact that could have on team size: “Incorporating AI and streamlining processing [will lead to a] reducing head count with more automation.”
It should be noted, however, that there is an apparent mismatch between the amount of time a treasurer predicts will be spent on technology and the subsequent reality.
Since 2020, the survey has found that time spent on technological advances was lower than predicted in the previous survey. Meanwhile, the time spent on capital and liquidity management was predicted to fall, but remained higher in reality.
The ACT comments that there are also the demands from the wider business. “If an organisation’s leadership believes in automation and that it can boost efficiency and improve data flows, there is no reason to believe that treasury will be immune to this pressure. Arguably, this could be a case of using technology to free up a treasurer’s time for greater value-adding activities.”
Philip Smith is editor of The Treasurer
This article is based on the ACT’s The Business of Treasury 2024 survey.