Lee-Ann Perkins on emerging treasury topics
As one of our key clients, we had the opportunity to speak with Lee-Ann Perkins to gain some insight on two topics that almost every treasury team at one point or another will have to grapple with – risk management and project management.
As versatile financial services professional, Lee-Ann Perkins has more than 19 years of domestic and international treasury management experience working in mid- to large-sized public and private organizations. She currently works as treasury professional at a global sporting and recreational goods and supplies company. Additionally, she is an Advisory Board member for Nacha, which governs the ACH Network, a member of the AFP CTP exam committee and treasury advisory group (TAG) and was previously the president of the Houston Treasury management Association.
During one of our discussions, you mentioned how risk management is perhaps not given the appropriate level of consideration that it demands. Can you please elaborate on this and explain how the treasury team of an organization can address this issue?
"The treasury department’s purpose is to safeguard the financial assets of the company. In doing so, we control the financial risks by conforming with board and internal policies and shareholder needs. Risk is inherent in the treasurers position and often this is overlooked and undervalued until a crisis hits.
We address and highlight the importance of risk management by ensuring our teams are curious, well trained, and informed. Start by allowing treasury the opportunity to ask questions and gather as much information as possible to ensure small misjudgements don’t lead to material costs down the road.
Treasury departments must be rigorous in ensuring compliance with established policies, procedures, and financial regulations. This is a non-negotiable aspect inherent in the position. We should guide conversations with the goal of strengthening processes to safeguard the company and its reputation.
I like the saying ‘A tsunami starts with small detectable waves’. And I believe that treasury departments are in a unique position to identify and evaluate risks and possible solutions. Treasury department is a financial function that both front faces (with banks, vendors, investors, rating agencies to name a few) and interfaces as partner of many internal stakeholders and areas of the business. These relationships, if well nurtured, can help the company to send solutions down the road to meet us when we most need them.
If given the resources, information and voice, Treasury can help the company manage and mitigate the causes of risk and not just the symptoms. Treasury departments have often been involved and brought to the table when a crisis has occurred. My mission statement for treasury departments, to use the Covid analogy, is: be the vaccine instead of the medicine! If you don’t manage risk, it will ultimately manage you!”
Lee-Ann Perkins
I take it one step further by stating that ‘the devil is in the details, but the success is in the strategy’
In addition to risk management, you also mentioned the importance of effective project management. Can you please share your experience in this area and what you learned through the process?
“It’s a well-known fact that treasury departments are often small and lack resources. Automation is a way to free up resources and allow treasury professionals to focus on strategy and risk management. Therefore, as we strive to automate and mature the function, projects have become integral in the treasury department’s strategy. Treasury professionals should have skills and abilities to effectively manage projects to success. We all know the saying ‘the devil is in the details’, which I agree with. But I take it one step further by stating that ‘the devil is in the details, but the success is in the strategy’.
In my experiences, project management has not been a part of treasury teams training. Due to the changing responsibilities of treasury professionals, we are often called upon to implement, change or enhance processes and/or systems. These projects require managing resources, selling ideas, implementing changes, and ensuring this is all done within the required budget and timeline. Success requires the practice of sound project management processes. These steps include planning (develop the project charter), organizing (create the organizational chart), leading (direct the resources) and controlling (continuous review of metrics). I learned this skillset in my MBA program, and it has served me well in leading multiple projects to successful outcomes. As this is most often a learned skill, I believe treasurers should advocate for training and development of this much needed skillset to ensure we follow the steps for successful project management.”
The topic of project management is quite often on the minds of treasury teams when they first contemplate the need to automate their systems. What advice would you give to an organization’s senior leadership that is forward-looking and seeking to adopt the benefits of technology but is cost-conscientious due to budgetary constraints?
“Firstly, I would say that this is the right attitude to embrace in the pursuit of future proofing and maturing the treasury department. Leaders have to manage company resources for the best and highest use of time and money. To compete for resources, treasury departments have to convince the leaders that their projects are in line with the company’s goals and strategy. Resource constraints are a real concern in companies. However, with proper planning and data-driven cost benefit analysis, these projects sell themselves when Treasury is able to demonstrate the quantifiable advantages.
Leaders should empower employees to utilize technologies for the intended purpose of creating efficiencies, providing information, and managing financial and operational risk through data and insights. Automation and dynamic forecasting systems proved particularly useful during the pandemic, when liquidity and short-term forecasts were crucial to run the business through unprecedented difficulties. Manually consolidating data can lead to missed opportunities and inaccurate information.
While treasury automation projects yield many benefits, they should be approached though a realistic lens. Projects should have a clear project charter, org chart, timeline and agreed-upon metrics to measure and demonstrate success. Automation projects have many stakeholders who need to provide input, assistance, and resources to ensure the desirable outcome. This requires thoughtful and deliberate planning and honest dialogue with all stakeholders.
When evaluating automation projects, the teams should ensure the systems are fit for purpose, scalable, and provide standardization, controls and audit infrastructure that will benefit the company. This approach allows companies to implement modules or systems that provide the most immediate beneficial impact and then scale up as they see the needs and benefits. I also suggest cloud-based systems for security, ease of implementation and cost.
My takeaway is to encourage leaders to ‘take the bot out of the human’, and allow treasury professionals to focus on capital structure, liquidity, risk management and meeting shareholder needs, and use technology to do repetitive transactions that help to simplify processes and reduce costs and errors while improving accuracy of information, data security and global standards.”
