J.P. Morgan

Amid market volatility, treasury teams play a strategic role in minimizing the impact of disruptions, instilling a cash mentality and streamlining operations.

Treasury can then work to reduce accounts receivable risk and improve business relationships. This could include determining the best banks to work with based on what services and products the enterprise needs. Working with the business to assess inventory levels can improve supply chain management, preserving the competitive advantage of supply and balancing working capital held as inventory. - Inventory levels for stock and work in progress. Similarly, a relationship with purchasing can help optimize the value of cash through negotiated purchase terms, influencing days payable outstanding metrics. For example, treasury can work with banking to increase automation in receivables reconciliation and lower time in cash application. [cross-border pooling](/commercial-banking/solutions/international-banking/foreign-exchange), investigate the options available to access jurisdictionally trapped cash, and consider intercompany netting. This impacts their ability to execute their obligations effectively, ensuring efficient funding of accounts and deploying cash for its best advantage. Ideally, treasury will have full visibility into the organization’s bank accounts, cash balances, cash flows and funding needs by jurisdiction and legal entity. To identify the enterprise’s current needs and form a long-term operations strategy, treasury teams should: If the business wants to enhance liquidity, for example, it could assess specific key performance indicators (KPIs) against accounts receivable to collect receipts faster and better manage customer credit. Amid economic volatility and geopolitical uncertainty, it’s more important than ever for organizations to plan carefully and optimize working capital.