Effective Communication Is the Lifeblood of Your Treasury Career

Announcer 00:04

Welcome to the Treasury Update Podcast presented by Strategic Treasurer, your source for interesting treasury news, analysis, and insights in your car, at the gym, or wherever you decide to tune in.

Jonathan Jeffery  00:18

Communication is in many ways the lifeblood of treasury skills, no matter how good you are at identifying risks and finding the best ways to mitigate them. If you can’t communicate, there’s often very little you can do about it. I’m Jonathan, media production specialist here at Strategic Treasurer. And today I’m joined by Craig Jeffery, to talk about one of the topics that is covered in Strategic Treasurer’s ebook titled “The Guide to Excellence in Treasury.” Welcome to the show, Craig.

Craig Jeffery  00:46

Jon, it’s good to be here.

Jonathan Jeffery  00:49

So to start out, can you tell us a little bit about The Guide to Excellence in Treasury? Why did we write this ebook? And why do you think it’s had such a good reaction with downloads and views online? And quite One of the things I was really impressed with this book is how it can transfer the skills that it talks about can transfer from career to career, it can transfer to your home life to your work life, there’s a lot of good information in here. So if you haven’t already listened to it, there’ll be links to, you could download the the audio book on Audible, or YouTube or podcast channels, or download the eBook if you prefer to read. So today, I wanted to cover just one of the topics that we talked about in the book. And that is effective communication, that you book breaks effective communication into five different categories or thoughts. I wanted to go over four of those categories with you, starting with the long view. Why do you call it the long view?

Craig Jeffery  01:02

Frankly, I was surprised at how how much interest there is in it. You know, in terms of downloading ebooks, there’s a lot of people tell you, nobody downloads ebooks or this type of content. But there’s certainly a strong desire to do better in your job. And that’s very true in the treasury space. People want to improve, I want to improve, you want to improve, and what are ways we can improve, you know, developing skills, getting ideas, reading, hearing from other people. And this is one of those tools that helps you get better. And so you know, as a guide to excellence in treasury, there’s, there’s clearly a lot of desire to do better. Well, the long view and communication is thinking about more than just this one conversation. If you’re communicating well, you’re setting patterns to do it on a recurring basis. This is for people that you partner with people in in the same organization. So if you take a long view, I want to learn what they’re doing what drives them, what motivates them, and to understand it, and to be effective in sharing what we do and how that ties into their, their objectives or their organization’s objectives. Then I’m, I’m taking the view of the war, not just individual battles, I’m taking the view of how I can do better at all times, I was thinking of the game of Katana. I don’t know if people play guitar, it’s this you have resources, you make things go and you will do better. And then the individual game, if you trade more, you make a trade that’s beneficial to each other party, right, you want to do the most trading. And each trade you do can be better for the other person. And so if you always do what you say you’re going to do, you don’t trick people, you don’t ever trick people, you might play those with those same people in their games. And so if you never trick people villa, like you always get better trades or whatever their thought is, they know that every trade they do with you will, will be better. And so the more trading are the better communication, in this case, if we can take it from the game to the reality is like, those communications will be more effective, you’ll build credibility, which, you know, is an asset that that earns interest.

Jonathan Jeffery  03:58

So does that change how much information or what information you’re going to share with somebody? If you adopt more of a long term view instead of looking at it project to project?

Craig Jeffery  04:06

It does. You don’t say OK, give me three weeks and explain everything about treasury to someone. That’s just, they’re not going to commit to that. But you should be able to share enough that helps them understand what’s going on and why and continue to build on that make sure that there’s things that they can connect to just like you want to understand what they’re doing. So you understand what what are their motivations and what happened. So I would consider that part of the context, the long view is understand the context of the relationship or the communication, of the need to understand

Jonathan Jeffery  04:40

And understanding that context would come from listening to the feedback that you’re getting, which is our next section titled listen, think, ask and talk.

Craig Jeffery  04:49

We’ve all had conversations with people that they’re not listening to what you’re saying. They’re waiting till your mouth closes and then they can say whatever their point was. And how do you feel when that’s the case, you feel like they’re just ignoring what you’re saying, you’re making a great point, maybe you’re, maybe you’ve got the best syllogistic argument structure that’s coming out and they’re ignoring it. If you listen to what people say, and you seek to understand, you’re gonna think about what they say you’re gonna ask good questions. And then now you can put forth your proposals, your approach, your suggestions, or things that you want to hash out together. Now, it’s going to be most likely received in in context and recognize that you you cared enough and focus enough to hear what they’re saying, and can repeat it back in a way that they understand. Many people hear arguments about that’s a straw man argument, that’s a steel man argument, a straw man argument is, you made a caricature of what the person’s point was. And it’s not accurate, the other person wouldn’t accept that. And so when you’re hearing and you’re reflecting back to somebody what their concerns were, you should be able to say what their points are in a way that they accept it, which is referred to as a steel man argument, if I can understand and repeat what you’re saying in a way that you agree with that shows that I understand at least at the level that I can, what you’re trying to do.

Jonathan Jeffery  06:17

A lot of the times if you if you’re having these discussions, and you don’t necessarily agree, you might bring up the steel man argument and say, I understand and I disagree. How do you work that back into the long view of you still have the partnership where you’re working together, you’re still trying to come to an agreement, give and take on on items? What What advice do you have for working through that kind of stuff?

Craig Jeffery  06:37

If you both understand the other position, but you disagree, maybe you wait something more heavily. I think, you know, working capital, the access to working capital is more important than your accounting efficiency. We don’t want to break it. But I think the the little bit of extra work that your team will take on that. I’m just making this one up. But but it gives us significant more capital, I think that ties more closely into the organization. They’re like no efficiencies, all what it’s about. And then you can disagree, and then try to come to some resolution, but you’re disagreeing on interpretation of something or how you would calibrate this particular result. And then then it’s on the table as opposed to just thinking of the person doesn’t know what they’re talking about, you can say. They understand they’re just waiting something differently. Now you’re having a conversation about why this is more important or less important.

Jonathan Jeffery  07:31

Which brings in the third piece clarity. If you have that disagreement or your your goals are not aligned perfectly you’ve you’re clear on your expectations, you’re clear on your path forward. What do you have to say about clarity, expectations, making sure that communication is something that the other party understands?

Craig Jeffery  07:51

We do the FinTech hotseat, which is a discussion disagreement as a panel discussion about different topics about payments, about security, about technology, whatever the topics are. And one of the items that we find most important, or trying to get down to where is the difference? Is will make people make this decision on? Is it A or B? And usually they’re not mutually exclusive? Is not? Is that right? Or wrong? Does it taste great? Or is it less failing? Or whatever the particular situation is? And people don’t want to make a decision, say which one is a higher level, even if it’s only a little bit, and say what that the percentage differences and give support for your reason. And I find, and I’m not sure how many people find this as helpful, but, but when you you have to make a case for what you’re saying and why. And there appears to be front end disagreement, but as you start to get down to nuances of where things matter, now you go, oh, when this occurs, this is this is irrelevant. But at this point, it trips over, where the other thing makes more sense. You know, it’s like, oh, everything’s, it’s all about cost benefit, right? Is everything all about cost benefit? Well, not if it’s about a compliance issue, which becomes a major issue, which eventually feeds back to cost benefit. And whatever those items are, you can you can get down and figure, oh, this is not material. Like, oh, we want to have a process that identifies any problems right away. Great. At a million dollars a day? No. So it’s, it’s just a way of calibrating when things make sense and when they matter. And so that idea of clarity is when you start to say, Where are the differences, find the common ground and find out where their points are differences. And many times most of those will melt away. There might be some differences based on what people’s preferences are. But the thing about clarity is not just to understand those, it’s to make sure we’re not using equivocal terms that the same word means different things to the two parties, for example, and even financial terms, Cash Forecasting, those mean very different things variance. All of those means something different, you know, a forecast For the income statement is typically a domain of f PNa. And they’re looking at broader categories, broader time domains, you know, a month, a year, a quarter versus a treasury forecast is there’s usually two one is the short term forecast, which is oftentimes by day and then by week, very much related to how much cash ever at any point in time, not just saying, Where are we in over the course of a month? But where are we over the course of a day? And then the balance sheet forecast? What do I need to have the balance sheet look like to support the the organization over time, people can use those terms in very different ways. That happens all the time. So making sure you understand the terms matters. Because if you look at an end to end process, either within your company, or end to end to end to end from your company through to another process. Now your goals have to fit into the broader meaning it’s like, oh, I want to have an efficient process. Well, not just efficient process between department a and department B, but all the way to our customer. And if we create something that breaks, they can’t see something, they don’t have visibility, they’re going to call department a or department B back and now what was very efficient, technically, now became broken, because someone else is calling back and says, What did you pay us for? So all these things factor into the organizational objectives and what you’re trying to do, you know, to be effective. And effective means having visibility, having clarity, and understanding each other.

Jonathan Jeffery  11:31

Yeah, like, it makes me think of how complicated it can get the more layers you add on because my first thought with this chapter is person to person or person to another company. But then you add in you were just talking about department to department to another company to department department, and keeping a communication method that can be understood throughout all those blocks. And it can easily get very diluted. But moving on, we’re going to jump over red lines, if you want to read the section on red lines, definitely go listen to the audiobook or download the eBook. But I wanted to move on to sharing other success and why that’s important.

Craig Jeffery  12:12

Well, the one of my most quoted quotes I use is optimizing part of the process of optimizes the whole. And that just means I’m focused on myself, my handoffs, etc, I don’t care about the others, I don’t care much about the other things, I want to optimize what I’m doing versus the whole, what’s the entire process and or between organizations, it’s if you’re trying to do something that’s significant that’s well controlled, efficient, is scalable, highly automated, all of those things working together, you have to get others involved in the process, not just to do what your betting is, or follow what you’re saying. But there has to be buy in so they don’t sabotage it so that it works well for everyone. And if it works well, for everyone, that means everyone had a part in making it have a success. And since that’s the case, if there’s success that has to be shared, because everyone pulled together for that common vision on this part of the process, or this particular effort, or this individual project or task. So that’s really what you’re, what you’re about here is, is working together by by looking with a common view across, let’s say, a task, or an activity, from start to finish for the whole process, and then figuring out what makes the most sense overall, because that means I can’t just look at it from my perspective, or this one other party’s perspective, what will what will be optimal for all and to make it optimal for all means, all had to participate in it some some more willingly than others, but this makes it attractive because it’s not like okay, department a forced everyone else to comply with the best view. Everyone got their usually by, by focusing together. And if they if they don’t do it willingly to they may give up on making sure their their process is as efficient as it can be in the context of optimizing everything. Because people know the details and activities in their own groups, they have to contribute changes, maybe harder, but this will allow everything to be optimized within the overall overall flow.

Jonathan Jeffery  14:26

Yeah, early in your career did you have leadership are teams that exemplified this to exemplified end to end sharing other success and to end great communication? Was there projects or things that stood out to you that you’ve worked on in your career?

Craig Jeffery  14:42

Yet one thing that’s still vivid in my memory is I ran a group that was with it and payments and we’re having all kinds of problems with our, with the vendor community because we’re paying late and pain, you know, without great information. So there are always calling trying to get information trying to figure out when things were getting done. And this is where we moved almost everything to electronic payments. And that’s not the end of the story moving to electronic payments is better. But we would be would move everything. And also figured out one where they rated on stuff most heavily they were rated on what the outstanding was at the end of the month. So talking to people, what was the key thing. And so for us, it was that we get more information put through before the end of the month, they’re gonna have less pressure. And we can just focus on where there’s real differences that have to be resolved as to be researched. And so we ended up targeting most payments three days before the end of the month, and then the next batch of payments would be the last day of the month. And it’s not that we ended up paying any earlier, it’s that we paid in a timeframe that created less friction for them. And we had a way we could share more information so they can apply funds to invoices more rapidly sharing that information digitally, we also had a backup way for those that couldn’t take it digitally. And that allowed them to get things cleared up. And by doing the the third day before the end of the month, they wouldn’t get that last second pressure from management to say get this stuff cleaned up because the bulk of it would be cleared cleared up three days before. And management, those companies was were writing all the ones that weren’t cleared up. And so most of them are cleared up. And then the rest of the items would clear out by the last day of the month. And they most the attention and heat and wasted effort would go to other companies who were paying like we were before. And this allowed us to have a little more space and room to fix process issues like our orders may not be including all the information and so orders would come in wrong. And then you know, those production areas would have to follow that. that sticks in my mind a couple of ways one from the overall process, two from the benefit of digital, and three from just managing capital, just knowing how that how that works effectively and using better payment methods. Those were some of the things that move me into the treasury domain.

Jonathan Jeffery  17:05

How did that start? Was it someone suggested it or it was my technology.

Craig Jeffery  17:10

I took over that department, I became responsible the department and they had been a lot of negative feedback in my my director was like, hey, this stuff, you need to get this stuff paid on time. And we were lightly staff for the amount of work and activity that was there. And so it became a not only how can we prioritize and organize our work? But what are the issues and pain points people feel? And how can I remove those that I can just by shifting some things around, you know, putting in more electronic payments, understanding how that worked, getting them the data so that they could resolve their pain points, he these are our five pain points, we can help you with these three, helping with those three, made a lot less pain for them allowed them to work better with us. That was probably the big triggering point for that as management wanted those things done and put me in charge to expand and make the relationships more effective. Because these were all well, most of our very important relationships. And they were our team needed to perform in that in a significant way. Without getting resources.

Jonathan Jeffery  18:14

Yeah. Interesting. Thanks for sharing that. What do you been learning lately about effective communication?

Craig Jeffery  18:21

That’s a good question. Well, I, I can’t remember book names. Since I use a Kindle. I don’t know what the book title is. I’m reading like three books right now, I don’t know what the book titles are. Because I just poke them. I see them in the little black and white screen.

Jonathan Jeffery  18:38

I’ll look up the book title and put it in the description.

Craig Jeffery  18:42

Well, one of them was when I make it was given example about communicating effectively and how someone might be a logic bully or someone’s this or that. That how do you bring people along? Not how do you just win an argument? But how do you bring people along? How do you get them to reexamine their biases and trends, and one of the stories was about somebody who had a very premature newborn they didn’t want to was in Quebec didn’t want to have them vaccinated. And no matter how much they pushed, they were not going to have their child vaccinated and somebody who is quite, quite effective and used this method of trying to find out what people’s reluctance were, ask them a lot of questions, not not manipulate them or not tell them or browbeat them, that you ask them why they came to those conclusions and how they did it. And what would would change your mind etc. So that this way of asking people, you know, pulling them forward getting to state what their objections are figuring out how they might look at things differently. And then if they’re interested in hearing information, they would then share particular information and this removed the great reluctance for some of the vaccination. You know, having their child get get a couple of vaccinations that were deemed really, really important to them, especially, you know, being a newborn. And the person ended up doing that. And that changed much the community where that was tend to be not that doesn’t matter what the specifics, but it helped relieve some of the the reluctance to do certain activities. That I thought was interesting, as opposed to, if I make a strong hard argument and marshal 50 facts in a row that that matters. Another example, as somebody who, who argues and makes makes cases was arguing against the computer, the computer brought up way more facts, it was a, you know, AI system generated all kinds of facts. And this most effective communicator, beat the computer, and it was focused on certain areas of agreeing where it made sense, and then showing disagreements where it didn’t. And so finding some of the common ground, identifying the points of differentiation was more compelling and move more people in the audience than ChatGPT’s, you know, complete compendium of facts, whether they were real or you know, made up made up facts. It was, it wasn’t that they had the most facts, but they helped understand find common ground and see the other person’s point of view. I thought that was pretty interesting, because didn’t dominate on facts, but help to see the other point of view so that they can have a second look and perspective.

Jonathan Jeffery  21:22

Interesting that was in that book as well?

Craig Jeffery  21:24

Yeah, that’s that was the other example in that book, that there’s lots of examples on it, but could just kind of interesting to read through it. And the author writes all these examples of, he got through one thing, it’s a little bit of a success story. And then it’s like, well, they also failed on this. And so I learned how to, it wasn’t just a brag book, but it’s like, they want to example is someone didn’t cast a vision for the company, and they fired three consultants. And then he, and then he, he started off, you know, I really like to be the person they bring in after you fired three consultants. So how did they screw up? So anyway, through went through the whole thing, and the person was like, Yeah, I need to have a vision, and the guy’s like, great. And so he laid out how to meeting and had the vision, but he missed, you know, here’s the plan to put that vision in place. And so the, the author was, like, I got him past that hurdle of not, of seeing what he needed to do, but I didn’t help him, you know, go through the process of being effective at it. And I find those examples humorous, because it’s not like, everything was bad, I came, and life was perfect. He shares a lot of examples of he moved, he got the next next step, but he forgot something else.

Jonathan Jeffery  22:36

Yeah, and in your career example, you talked a little bit about needing to change your communication with the customer, right? While you’re moving towards the new technology, bringing in electronic payments, as we’re figuring out how to use generative AI in that same way. How’s that going to change our communication methods? Learning to use it to communicate not only with our clients and and co workers, but also communicating with AI and having it communicate back to you. So that there’s a conversation that moves you along and gives you the data that you need? How do you see this shifting our what we know is communication?

Craig Jeffery  23:19

That’s probably three questions all packed together? That’s a great question. Maybe I’ll tell her a couple of stories. It’s like we have computers talking to computers, companies are trying to protect against spam and phishing and everything else. And so a lot of companies have the software, you know, loads into some virtual drive, it checks the links to make sure they’re not, they’re not bad. And if it finds certain activities that blocks things, well, it got to the point where I’m not sure how long ago it was, but all of a sudden, our emails weren’t getting read. We had things set up a certain way. They had things set up a certain way. And they would come to the website, and we would ours our system, our defensive system would see it as bots are coming to the site. And probing like 10 Links in or out, let’s say there’s three links in the system or 10 links, it would probe them all at once. And so it was treating this as a hostile bot. And so we were blocking activity. When their bots were coming to say, Is this legitimate? Let’s examine what the site has. And so we had to make adjustments on both sides. Because one is like I’m testing to protect things. And we’re like, Okay, this is a bot, you know, probing our system. And so it’s just this, this war on war. And so we’re like, Okay, we’ll make some adjustments. We made it so that it became effective. And that’s not necessarily AI. It’s some type of automation. But how will AI help us be more effective? Certainly, people are throwing stuff in, you know, for memos or emails to craft language that might be a little cleaner. They can then edit it or modify, it’s like, okay, this, this works. It’s going to help on communication. If you say, Oh, I don’t know what our contract is when our what our requirements for this, this line of credit, what are the particular issues or go through our Go For contracts, to spit out payment terms to see where things are, all of those things are great uses of, of AI to run through the material and sort and sift it up really, really quickly, versus putting five people on it for, you know, five days to go through and read contracts and miss a lot of stuff. I can miss some things too. But it’ll miss less than that people do and do it almost instantaneously. Some of those are helpful on the communication side, it’s also true. When you’re going through data, you want to provide information about exposures, you’re doing this within the bounds of your system, not publicly, you can get generate, particularly internal communication, going through data and information and creating some kind of summary about that. You can have ai do that pretty effectively. Now, that’s not super deep insights yet, but that will be soon.

Jonathan Jeffery  25:55

It’s where it’s going. Yeah.

Craig Jeffery  25:56

It’s going quickly. Yeah.

Jonathan Jeffery  25:58

And you talked a lot about the AI from a text, like GPT style right now. But once it’s used a lot in forecasting and reporting, and that’s going to be a lot more useful. I think, for day to day items, then hey, can you make this email look a lot cleaner, and that’s coming, like that’ll be here very soon. And so being able to communicate with it and have it give you the information you need, and the sources is going to be the tricky part. I was talking to someone recently about ChatGPT. And they’re like, it’s terrible. And I was like, Well, you have to talk to it the way it needs to be taught to you. All right, well not give you the information. And that’s gonna that’s gonna happen is more generative AI comes out for different different sectors or different software’s.

Craig Jeffery  26:41

Yeah, it’s it has to be trained, right? It doesn’t just know everything. And so you continue to train it, you give it some additional guidance, and now it’s learning how to put things in the way that that makes sense. If it’s language, or if it’s, you know, reviewing here, here are the five bullet points that are highlights from the financial results. Well, you can train it to pull through 10 Qs and 10 Ks and pull out that information. If it’s public, it’s been out for a while it’s, it can give you a great summary.

Jonathan Jeffery  27:12

You have anything else you want to leave the audience with?

Craig Jeffery  27:15

Yeah, just, you know, The Guide to Excellence in Treasury is a free download. There’s digital report, it’s also read. So really appreciate people using those resources. If you have any ideas for other things we should write on as we continue to expand that broader series of excellence in treasury, let us know.

Announcer  27:38

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