How treasury transformation could help build enterprise value

Finance and treasury experts share the challenges and opportunities they experienced on the transformation journey

In recent years, corporate treasurers have witnessed a shift in transformation strategy. Originally, it was about replacing antiquated systems with new technology and working practices. But now, treasury transformation sits at the centre of business strategy. 

This shift has been driven by a number of factors: mergers and acquisitions, technology modernisation, regulatory change, automation goals and an expectation that treasury should contribute directly to enterprise value creation. Such a shift moves transformation on from simple operational resilience to a more embedded, connected and aligned process. 

As Mike Hawkins, Head of International Corporates Cash Sales at Barclays, says, treasury transformation can mean many things. Drivers range from automation and efficiency initiatives, moving away from spreadsheets and manual processing, to much larger structural catalysts such as corporate strategy shifts, global consolidation, wide technology implementations, tax restructuring or M&A activity. Increasingly, organisations are also moving treasury “from a ‘simply keep the lights on’ approach to enterprise value creation”, he says.

 There are lots of competing priorities, so having the right level of senior representation for a project really helps... James Marshall  

Growing expectations

For James Marshall, Head of Treasury at Virgin Media O2, transformation has been shaped by a period of consolidation. Treasury evolution is continuous because “as a treasury team, we have to forever transform to meet the demands of our stakeholders”. 

When Virgin Media and O2 merged, the treasury challenge was immediate. “Our cash management needed to be as good on day one as it would be on day 100,” Marshall says. As such, the treasury team needed complete visibility over cash positions while aligning new customers, other stakeholders including parent companies, policies and operating structures simultaneously.

This, in practice, meant that the treasury team needed to understand the cash model on both sides of the new business in advance of Day One – as a joint venture, Virgin Media O2 has two shareholders (Liberty and Telefonica), both of which were engaged at an early stage so that treasury could agree a well-defined treasury policy, to which everyone could adhere. Reflecting on the international nature of the business, and its shareholders, Marshall says: “We needed to ensure we are talking the same language and that everyone understands what we are trying to achieve.”

Marshall adds that a key part of a successful transformation was the creation of a project team, one that was well disciplined and understood the risks – such as a fundamental customer outage or a breach of regulatory requirements. And senior sponsorship was also key: “Part of our philosophy when carrying out high level IT upgrades is to make sure that we are represented at the top of the house,” Marshall says.

“There are lots of competing priorities, so having the right level of senior representation for a project really helps.”

Rationalising complexity

Bibby Financial Services faced a different challenge: operational complexity. Managing approximately 20 banking relationships and more than 5,000 bank accounts using highly manual processes had become unsustainable. The transition towards the ISO 20022 standards on financial messaging further accelerated change, with the need to move into a more compliant ISO, avoiding the risk of losing access to increasingly valuable transaction data. 

Strategic evolution

Meanwhile, according to Group Treasury Director Bert Heirbaut, transformation at IHG Hotels & Resorts reflected strategic evolution. Moving from hotel ownership to an asset-light management and franchise model fundamentally altered treasury requirements. Combined with international expansion into new jurisdictions and increasing foreign exchange exposures, treasury infrastructure had to evolve alongside the business. 

Measuring success

So, what does treasury transformation success look like, and how can this success be measured? Marshall highlighted a success metric that treasury leaders sometimes overlook: customers should never feel disruption. Billing accuracy and collections continuity became non-negotiable measures of success. 

Bibby Financial Services offers a particularly instructive example, as they discovered significant efficiency opportunities before implementation even began. The team closed 1,500 bank accounts and then restructured further, using virtual account architecture. The result was that millions of transactions could then be supported by just 12 underlying bank accounts rather than thousands. 

The organisation also made an early decision to engage an implementation partner alongside its treasury management system provider, a move described as “critical” to the task of meeting timelines and accelerating knowledge transfer. 

The project was not without its challenges. Just five days ahead of the go-live for the new system, the treasury management platform suffered its first major outage in 18 years. Fortunately, Bibby had invested heavily in business continuity planning rather than treating it as a compliance exercise. This meant that customers still received funds as expected. The issue became validation that preparation matters as much as platform selection. 

Heirbaut highlights another often-overlooked aspect: discovery phases consistently reveal surprises. Teams managing processes daily frequently stop questioning whether long-standing structures remain necessary. “Low hanging fruit” such as closing bank accounts, streamlining structures and centralising activity, often creates immediate value before major transformation even begins. 

 Engage banks and providers early... Bert Heirbaut  

Future-proofing treasury

One of the strongest messages is that transformation is not a one-off event. Regulations change, payment infrastructure evolves and data expectations grow. 

Treasury leaders increasingly need systems that can adapt rather than just meet today’s requirements, with platform flexibility and real-time processing capabilities as key enablers of future readiness. Heirbaut emphasises external networking and staying close to banks and industry developments as well as the treasury community, adding: “Engage banks and providers early.”

 The success of any transformation project starts with being able to walk before you can run, and that means having a solid data foundation on which to build... Declan Ware  

Advancing AI

All the while, artificial intelligence capabilities continue to advance. AI represents an emerging transformative power. Treasury teams see promise in cash forecasting, reconciliation and trend analysis. Clean data and information security will be key requirements in this process. 

As Orianne Steel, Global Treasurer at Freshfields, says: “Treasury transformation is about improving control and efficiency. Both depend on having reliable data in place. This becomes particularly important when implementing a treasury management system.” 

Declan Ware, Group Treasurer at EMR Group, adds: “The whole world seems to be caught up in the buzz around transformation. But that risks putting the cart before the horse. The success of any transformation project starts with being able to walk before you can run, and that means having a solid data foundation on which to build.”

Conclusion

In the past, treasury transformation might simply have been about upgrading systems and implementing a new software package, backed by new methodologies. But it is equally important to build a function that can continuously adapt, support growth and create enterprise value. Success depends as much on leadership, planning and strong foundations as it does on technology itself.