Constant threats to the economy’s health provide an ongoing incentive for companies to build working capital resilience as protection against potential problems. Today is no different. The global outlook remains uncertain, and current market conditions are volatile for a number of reasons.

Treasury practitioners are getting used to an environment of elevated interest rates, whether by taking advantage of receiving higher levels of interest income than of late, or by evaluating alternative solutions when seeking to refinance longer-term debt. While the Fed has indicated the next interest rate move is likely to be downwards, the timing of any change is unclear, with rates expected to stay “higher for longer.”

Politically, November’s U.S. presidential election will be the source of some economic uncertainty as the fortunes of candidates wax and wane during the campaign. Some investment decisions may be postponed until the winner is known.

More generally, it is not difficult to anticipate a host of politically driven decisions affecting both domestic and international trade policy. Many governments use trade tariffs both to encourage their domestic economy and as a tool in international relations. Graver still is the risk of an escalation of one or more of the various conflicts around the world and the consequent impact on global supply chains.

While no one knows how these various situations will play out, companies need to identify the risks to their businesses and take steps to manage them. Treasurers should understand — and communicate internally — any potential cash flow implications.

On the positive side, treasurers, in particular, have better access than ever to tools that do just that. The evolution of treasury technology, in terms of both enhanced functionality and falling price points, means even small and medium-sized enterprises have access to sophisticated technology platforms. These can support improved visibility of positions, more powerful collation and analysis of data, and the automation of multiple core processes.

A noticeable and significant trend is the ongoing shift from paper to electronic payment and collection methods. These innovations can potentially improve operational efficiency by streamlining processing and providing treasurers with more accurate information on the use of cash and working capital.

The treasurer’s core role remains ensuring the company can meet its obligations. This is achieved by focusing on protecting company assets by identifying, measuring and managing risk. Today’s treasurer will want to identify how to harness treasury technology solutions and payment processes to enhance their organization's resilience through the efficient use of working capital.

Faced with economic uncertainty, treasurers have an enormous role in helping protect their organizations against the effects of various threats. In particular, by harnessing technology to improve visibility over cash positions and flows, treasurers can gain insights into where their organizations are most exposed. By communicating these insights to the business, treasury can help the organization think strategically about implementing change to build resilience.