Types of Organizational Interactions
McKinsey identifies three types of organizational interaction or activity:
Transformational – where something is transformed, rock into iron ore in a railcar, or iron ore into a steel bar, or a piece of leather into a shoe.
Transactional – a routine interaction takes place, such as ringing up a sale, balancing the bank account to the accounting ledger, or filling out an expense report.
Tacit – interactions requiring experience, expertise and judgment, focused on complex problem solving, strategy, planning and knowledge exchange.
A finance and treasury organization focuses on transactional and tacit activities. Transactional activities include posting, balancing and reconciling, routine banking activities such as cash concentration, issuance and investments. Tacit activities include assisting business units in analysis and strategic planning, determining cost of capital, and managing relationships with banks and market participants. Participation on project teams often involves exchanging knowledge, problem solving, and planning.
The Intersection of Treasury and Web
It is certainly the case that the intersection of treasury and web has come a long way with respect to transactional activities. Most Treasury work today is done interfacing with bank websites, treasury workstations, and ERP systems.
On the tacit side of things, there are discussion group sites, such as the Association of Finance Professionals, where knowledge is exchanged, and which sometimes pose problems that need to be solved. This also occurs within discussion groups on LinkedIn, and on various private sites. Blogs also contribute expertise, thoughts, ideas and information which may be of assistance to those interacting tacitly.
The primary factor involved in the intersections above is the network. This is a primary unit in the tacit economy.
In the old days, our network consisted of those we interacted with at the country club, the professional association dinners, and industry and professional conferences.
Our networks now are friends in Facebook profiles, those we follow and who follow us in Twitter, our LinkedIn professional groups and networks, among other things. These networks are more plentiful, larger, and more overlapping than before.
OK, so far we have, from part 1 – change is going to happen, and from part 2 – tacit interactions is where the rubber hits the road and the social network is the unit of work.
The exploration will continue…
I would love to hear your thoughts about impacts to the future treasury organization or your stories on this topic if you have them.
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