Visual Aids in Analysing Treasury Operating Models (Part 1)

As we gather information about a treasury operating model, analysing the data in a way that gives clarity and understanding is key. Over the past 7 years, we have developed a toolkit of visual aids to help our clients understand their current cross asset operational state. What we try to provide is both a bottom-up detailed analysis and a top-down elevated view to illustrate operating trends and patterns, whilst enabling a deep dive to the facts.

We begin building a service capability register right from the start, into which we record the front, middle and back office and risk business functions and processes, mapped back to teams and functional units. This register gives us a detailed view of how functions, people and systems align, with their respective technologies and communication methods.

We also build a risk register, where we make a catalogue of the risks we’ve found, how likely they are to occur, and the scale of impact they cause when they do. This data gives us a weighted ranking of risks which we can present visually using multiple methods.

An elevated view of treasury operating risks via visual aids serves as invaluable tools for structuring data, creating a more digestible narrative of the current operational state, and enabling the client to gain insights quickly. Reports often leverage a diverse array of visual aids. For instance, risk registers display data in a meaningful way by highlighting probabilities and impacts and ranking risks accordingly. Where we can slice the data to answer questions such as

  • Which business providers, processes, systems, products, carry the most risks?
  • What are the common underlying drivers of risks?
  • Where in the organisation are risks focussed?

Another way of presenting the risk data is via a spider chart. We can deliver on one chart multiple data dimensions such that a client can compare departments, systems, and risk drivers in one picture.

A critical asset we deliver is our risk heat-map summary. Given we have a risk catalogue with metrics for probability and impact, showing this data visually gives a smart way to see the skew of risks. A solid operating unit with low probability risks and low impacts will be skewed towards the ‘green’ area of the chart. Conversely, we often see organisations which are skewed in the wrong direction with too many high probability and high impact risks in the ‘red’ zone.

As we produce these charts, we also provide a benchmark analysis comparing the client’s organisation with similar metrics from other organisations and industry. Many firms face similar risk profiles, which can give perspective on the challenges the industry faces to increase STP rates and lower risk at the same time.

In part two, we will talk about how we move further into the ‘deep dive’ and more visual aids.

Photo by Krzysztof Niewolny on Unsplash