That time adding complexity unlocked efficiency.

Eavesdrop long enough on folks working in construction, and you’ll hear about stub-outs. This means installing major plumbing or electrical components in a wall, then capping them off rather than completing the work. The design and infrastructure for the resource is done (if inactive) and ready to be accessed in the future.

Stub-outs can be useful in business, too; leaders with strategic mindsets can design their technology, people, and finance systems today in ways that anticipate the growth they expect tomorrow.

The leaders at one global telecommunications company have such a mindset, particularly in the realm of finance. Their company—with offices in dozens of countries managing hundreds of suppliers and servicing more than 1,000 enterprise and public-sector customers—seemed to be operating well. (In fact, it was). But would that always be the case?

Because operating well today meant business was growing, and that growth—particularly overseas—meant the company was party to global changes in governing tax regulations. So to harness tax efficiencies (and continue growing tomorrow), leaders undertook a legal entity rationalization, realigning the company’s organizational structure and business processes.

In practical terms, this would mean transforming the company’s US-centric operating model (whereby the company both paid suppliers and collected from customers in US dollars) into a bifurcated US and foreign principal model. In the new model, the US company would continue to facilitate domestic sales, while a UK-based principal would facilitate non-US sales through several limited-risk distributors.

Further ripple effects: Changing the model would mean that the company’s treasury—the function that managed money and financial risk—would need to be structured differently as well. There were opportunities to improve cash management and governance.

The existing bank account structure, for instance, would leave cash scattered across multiple markets (“idle”) when, instead, it could be put to work (i.e., be invested or pay down borrowings). This structure would also make it harder to maintain visibility and take more manual work to control the expected increase in transaction volumes. More to the point: Since potential M&A ventures would require significant changes to the existing banking infrastructure, future growth could be compromised.

Addressing these inefficiencies would mean building out a new financial infrastructure. But doing so—shifting the way procurement, sales, and intercompany trade were managed—would add a degree of complexity and scale that the company’s treasury function wasn’t necessarily equipped to handle.

Yet … because there was a possible road map to the future state, and it involved revisiting treasury’s strategy, organization, workflows, processes—in fact, its entire mechanism. The road map involved a treasury transformation. To help assess what such a road map would look like, the company called on Deloitte’s Treasury Advisory Services. And despite a global pandemic and the need to conduct all business virtually, everyone got to work.