In one year, GE HealthCare achieved a treasury transformation, reducing the tech stack and onboarding a new team.
When GE HealthCare was tasked with spinning off from GE, the treasury team saw an opportunity to create a new organization constructed with a “fit-for-purpose” approach that included rebuilding the technology stack with off-the-shelf solutions that accomplish specific tasks—rather than the far-reaching, customized tech tools used pre-spin-off.
- In 12 months, GE HealthCare implemented nine new technology systems—down from 36 legacy solutions—and won an Adam Smith Award for Best Treasury Transformation Project. The spin was completed in January 2023.
- At a NeuGroup treasurers symposium sponsored by FIS, global treasury operations leader Aditi Agarwal, accompanied by assistant treasurer Peter Claus-Landi—two former employees of GE Capital who helped build treasury at the new company—dove into the keys to success and achieving both efficiency and effectiveness.
- “If you want to predict the future, you need to create it, and we created our future for ourselves,” Ms. Agarwal said. “We aimed to build something that wasn’t a Ferrari but not a minivan either—just fit for purpose.”
A mindset shift: less is more. Treasury at GE HealthCare is responsible for managing cash across more than 70 countries and more than 50 currencies—a big and fairly complex portfolio. But Ms. Agarwal said rethinking the tech infrastructure meant carefully weighing both what treasury needed and what it could most likely do without compared to the pre-spin company, whose volumes were too large for off-the-shelf solutions.
- “The biggest task was simplifying legacy systems, which were so homegrown, but you could do anything in them.” she said. “We asked ourselves, ‘Do we really want that?’” When the answer was no, treasury turned to out-of-the-box solutions.
- “We made a conscious decision to minimize customization, and this approach allowed us to optimize costs and reduce complexity, setting a foundation for future growth. We took chances, we were able to take a calculated risk. We’ve tried to challenge ourselves to consolidate.”
What’s inside the box. The team opted to use a suite of subscription-based software-as-a-service (SAAS) platforms, which are accessed online and require little to no customization. Among these are three cloud-based, off-the-shelf FIS solutions:
- FIS Treasury and Risk Manager – Quantum Edition, which functions as a TMS and treasury-specific ERP.
- FIS Payment Hub – Enterprise Edition, a payment hub.
- FIS Bank Account Manager for electronic bank account management.
The setup also includes a SAAS FX risk management solution, a web-based trading platform, a trade finance solution, a central data lake and two market data licenses.
Priorities and people. Building a fit-for-purpose technology stack was one of four key priorities that drove the transformation to establish an independent treasury organization. The others were breaking down silos within finance, creating a future-oriented vision and delivering shareholder value.
- Communicating those priorities to dozens of new hires was key. Mr. Claus-Landi said there was a conscious effort to better manage talent, in terms of training and retaining new team members, as well as positioning treasury within the spin-off company for a strategic role.
- “We needed to educate, in a cross-functional process, what treasury at a standalone company actually does,” he said. “Treasury needs to come to a table with IT, tax, controllership, etc., to ensure-buy-in.
- “We were very thoughtful of how we stood up processes and stood up broader roles, making sure people aren’t stuck in one path for the rest of their career, creating paths for development.”
Success story. The transformation has led to significant benefits, in addition to the streamlined tech stack: a 25% reduction in FX trading volume through netting with an FX tool; a significant reduction in reports by consolidating data into a single lake; and simplified delegation of authorities managed on an account-by-account basis within the SAAS platforms.
- Ms. Agarwal said treasury’s success required focusing on five key pillars: technology, people, process, governance and access to data at the right time in the right format.
- “Automate processes and get people out of mundane processing tasks that they’ve always been a part of,” she said. “Enable the tech to do what it can do, and that’s when the real future, the real change happens.”
