Out of the office and onto the line.

• Position: Role of corporate treasurers - State-of-the-Art Treasury Management - Panel Discussion

No more plain-vanilla cash management and financing operations. Today's corporate treasurers must move fast, and they're getting deeply involved in their companies' operations.

At Financial Executives Institute's recent Treasurers' Conference, eight corporate treasurers gathered to discuss for Financial Executive the remarkable changes that have taken place in their responsibilities in the last 10 years, the changes they anticipate will take place in the next 10 years and the major challenges they face. Their discussion was moderated by Bryan R. Roub, senior vice president-finance of Harris Corporation.

BRYAN R. ROUB: What skills are most valuable to the treasurer today?

BUEL T. ADAMS: The two most important skills a treasurer needs to have are, first, analytic ability and, second -- something that every manager needs -- the ability to communicate both verbally and in writing. These are more important, in my opinion, than technical skills. Technical tools are important, but they aren't the core of the business.

JAMES M. GROBERG: I agree that one of the most important things for the treasurer is a keen analytic sense. I would add creativity, which was not as important in the past as it is now. With all of the financial instruments that are available to us and the new ones that are coming along all the time, the treasurer has to understand what new products are useful in his or her area. This, in my mind, takes creative thinking.

Creativity becomes even more important as businesses expand globally. You have to understand how your business will be affected if, for example, Argentina suddenly puts a new tariff in place. This is something new, at least for me. We didn't have these demands in the past.

MARY LOU AMBROSE: I'd add another that I think is essential, and that is the ability to integrate information. We have to be able to take data from so many different sources and pull it all together before we can understand what impact it will have on our business.

ROBERT P. WATSON: That's key. When I first started working, we spent most of our time adding up numbers and calculating present values and the like. We didn't need to ask ourselves what these numbers really mean and how they flow in relation to each other. Today the things we used to spend time on are being done by computers, so we have time to conceptualize the problems we're trying to solve and to understand how they interrelate with all other factors.

ROBERT H. HERTZ: I would add negotiation skills. Increasingly, we have to find financing for customers, and negotiations are part of the process. This is especially true internationally.

ROBERT S. PARK: I think the need for technical skills is expanding. With the flattening of the corporation that's going on today, we have to understand what the next layer is talking about. That next layer may be an employee or it may be an outside source. The treasurer needs to understand what's going on throughout the company and to communicate with so many more different departments than we used to. This is in addition, of course, to the need to stay on top of the many financial instruments that are available, as you've already said.

KENNETH C. BUDDE: My company is relatively small in comparison with most of the companies represented in this discussion. The principal treasury function we have is cash and banking management. But even in these areas there are many more products this year than there were just a year ago. The marriage of market-place information and knowledge with our needs is a real challenge for us.

GROBERG: I think the bottom line of what we are responsible for is risk management. Things that were relatively unimportant to the bottom line 10 years ago, or even five years ago, become so much more significant now. My company, for example, is very heavy in the human resources business. We used to give very little thought to unemployment insurance or workers' compensation for our temporary employment operations. In that industry, 5 percent or 6 percent on sales is good performance. Consider what would happen if our workers' compensation rate or unemployment insurance rates suddenly double. Those areas weren't particularly important to us even as recently as two years ago.

ROUB: In the past, the risk manager was the individual who dealt with the insurance brokers. But all of that began to change, I would say, about seven or eight years ago when risk management concepts began to be applied to other areas.

M. JEANNINE STRANDJORD: At Sprint our risk management and insurance department assumed responsibility for developing loss prevention policy three years ago, and now serves as a central resource for field operations. We added environmental compliance activities last year.

The treasurer's job has grown so much in the last 10 years. We've moved from funding for the corporation and cash management to assuming functions that are more operational: risk management, loss prevention, benefits administration, all of which are very important to the corporation. And now we're talking about adding real estate and facilities to treasury.

ROUB: Do you think this is a general trend?

STRANDJORD: Yes, it's very normal these days. More and more you'll see these things coming to the treasurer out of human resources or operations because of the huge financial impact they have.

GROBERG: The flip side is that I find these operational aspects very difficult to control. The loss control practices for workers' comp, for example, are in the operating division, not in the treasurer's office. So when the treasurer's office started getting involved, the operations people tended to back away and say, "Okay, you've got it. If it goes up, it's your fault." If it doesn't work out, it's your fault." We've got to be extraordinarily careful that the operating divisions understand that we don't invent the claims experience. Or the accruals. Clearly we need to stay close to operations and make certain they don't abdicate their responsibility just because the treasurer's area has picked up those responsibilities.

BUDDE: And the treasurer needs to be able to negotiate these fine lines with operations people and deal with them effectively.

STRANDJORD: Another area that has changed...