Man standing and leading a boardroom meeting


Rhonda Kruman

Executive Director, Corporate Treasury Consulting, Commercial Banking

John Stevens

Executive Director, Corporate Treasury Consulting, Commercial Banking

As your treasury functions become more digital, it’s important to understand the relationship between tech decisions and legacy systems. The web of past systems, decisions, investments in platforms and ongoing management of inefficient processes has financial and cultural implications, which is often referred to as tech debt.

What is tech debt?

Treasury’s ever-changing scope of business can make tech debt hard to define. 

4 things to know about tech debt:

1. Tech debt is an abstract concept that originated in coding. But the term is increasingly applied in other fields.

2. Tech debt isn’t focused on whether the cause was intentional or not. Instead, it looks at the current reality that needs to be addressed.

  • Teams may have made concessions during the design or rollout phases to speed up the project. Those temporary solutions now need to be made whole.
  • Systems, coding languages or operating paradigms can quickly become obsolete, making a refresh necessary.

3. For treasury, tech debt often creates a fragmented ecosystem and poor user experience. It also keeps departments from using newer, more advanced systems.

4. It isn’t feasible to eliminate all of your tech debt. But you can manage it by working with stakeholders across your organization, thoughtfully incurring it and preventing unaddressed debts from hurting operations.

Treasury’s tech debt challenges

If treasury wasn’t included in previous technical decisions, its needs may have been ignored—or solutions were retrofitted after the fact. Treasury must now execute today’s mission using yesterday’s tools. If outside teams misinterpret treasury’s tasks and needs, it could lead to significant technical debt.

Treasury should play an active role in equipping itself for the digital workspace. It can do so by being part of the decision-making process and working with stakeholders to identify tech debt and its challenges.

Creating value through collaboration

Effectively managing tech debt requires working with several departments and experts, both inside and outside your business. The first step is to create an internal transformation team of stakeholders from across the company. Together, the group can help the company address past challenges and manage any future tech debt. Every organization is unique, so it’s important to include the right stakeholders. Your internal team should include:

  • Finance leadership: The CFO and others can define how the business needs to perform and provide insights into how the transformation team should function. These leaders also approve funding.
  • Information technology: These team members know how to use technology to find efficiencies. They can tap into their disruptive expertise to help reimagine impacted processes altogether.
  • Users: Any system you design is only as good as the user experience that comes with it. Current users can tell you about their challenges—and give input on how to improve those issues.
  • External resources: Outside experts can add value with independent guidance and industry best practices that bolster the internal team’s approach.

The team can collaborate to understand the current situation, including what works, what doesn’t and what’s causing the challenges. Without identifying the root cause, any improvement plan is unlikely to succeed.

The team can then plan how best to fix the current issues and deliver the best user experience. Remember to build in regular reviews to ensure plans continue to meet business needs.

Outlining the challenges—and how they affect performance, increase risk or lead to lost opportunities—is a key part of your tech debt plan. When all parties understand the organization’s priorities, the transformation team can focus on its goals.

Ongoing collaboration to drive success

By integrating your transformation team’s collaborative approach into your organizational culture, you can avoid future problems. Make tech debt remediation and management part of the fabric of the company so you are always one step ahead.

IT and finance may still have different definitions of success based on their disciplines. Working together, both sides can educate each other on differing expectations and develop a mutual understanding to guide decision making.  

J.P. Morgan’s Corporate Treasury Consulting team can help your organization with a process review and treasury roadmap. Fill out the form below to learn how to get started.