Issue 87
www.globalbankingandfinance.com
CONTENTS
CEO & Editor In Chief Varun SASH Managing Director Mayha Das Managing Director Martin Murphy Editor Barnali email: editor@gbafmag.com Editor Regional Shaharban T Project Management Megan S | Raj G Assistant Operations Manager Anupama KU Director of Operations Babitha G Digital Sales Rohit D Nominations Adam L | Sarah F Research Varshitha K | Jyothi P Video Production & Journalism Phil Fothergill Graphic Design Shiva K Advertising Phone: +44 (0) 208 144 3511 marketing@gbafmag.com GBAF Publications, LTD Alpha House 100 Borough High Street London, SE1 1LB United Kingdom
editor Dear Readers’ Welcome to Issue 87 of Global Banking & Finance Review. As finance becomes more deeply connected to every part of the enterprise, the ability to integrate data, technology, operations, and decision-making is emerging as a key source of competitive strength. In this issue, we explore how organisations are building more connected, resilient, and adaptable operating models to improve performance amid rapid technological and economic change. Our cover story, “Why Connected Finance Is Transforming Corporate Performance,” examines how shared data, cloud platforms, APIs, automation, AI, and real-time information are reshaping the role of finance. Rather than operating in isolation, finance is becoming increasingly integrated with operations, procurement, sales, treasury, and risk management, supporting better forecasting, faster insights, and stronger decision-making. We also feature José Manuel Silva, Partner and CIO of LarrainVial Asset Management, who shares his perspective on the future of investing in Latin America and the investment processes supporting the firm’s regional strategy. In another featured interview, Datuk Khairul Kamarudin, President & CEO of Bank Muamalat Malaysia Berhad, discusses digital transformation, financial inclusion, customer trust, SME growth, and the evolving role of responsible Islamic finance. Elsewhere in the issue, we examine operational resilience, organisational momentum, treasury modernisation, real-time payments, strategic optionality, adaptability, and the modern operating model. Thank you for reading. We hope Issue 87 offers valuable perspectives as you navigate the evolving landscape of global banking, finance, technology, and business.
Global Banking & Finance Review is the trading name of GBAF Publications LTD Company Registration Number: 7403411 VAT Number: GB 112 5966 21 ISSN 2396-717X. The information contained in this publication has been obtained from sources the publishers believe to be correct. The publisher wishes to stress that the information contained herein may be subject to varying international, federal, state and/or local laws or regulations. The purchaser or reader of this publication assumes all responsibility for the use of these materials and information. However, the publisher assumes no responsibility for errors, omissions, or contrary interpretations of the subject matter contained herein no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the publisher.
Barnali Pal Sinha Editor, Global Banking & Finance Review
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CONTENTS
Inside... FINANCE
BUSINESS
14
Why Connected Finance Is Transforming Corporate Performance
18
Why Operational Preparedness Has Become Every Company’s Competitive Advantage
32
How Real-Time Payments and Treasury Modernisation Are Reshaping Corporate Finance
22
How High-Performing Organizations Build Long-Term Momentum
36
Why Optionality Is Becoming a Business Superpower
26
Operational Efficiency Strategy: Why the Modern Operating Model Has Become a Competitive Advantage
TECHNOLOGY
42
Why Adaptability Is Becoming the Most Valuable Technology Asset
INDUSTRIES
48
Industry 5.0: Why Human-Centered Technology Is Becoming the Next Wave of Industrial Innovation
INTERVIEW
06
LarrainVial Asset Management on the Future of Investing in Latin America 04 | Issue 87
José Manuel Silva,
Partner and CIO LarrainVial Asset Management
CONTENTS
INTERVIEW
08
President & CEO Bank Muamalat Malaysia Berhad
How Bank Muamalat Is Shaping the Next Chapter of Islamic Banking Issue 87 | 05
INTERVIEW
LarrainVial Asset Management on the Future of Investing in Latin America 1. LarrainVial Asset Management has been recognised as Best Asset Management Company Latin America 2026. What key strategic pillars have enabled your firm to stand out in an increasingly competitive regional landscape? We defined ourselves many years ago as Latam specialists. Since then, we have been building an investment framework that combines strong fundamental analysis of Latam companies and macroeconomic factors that influence FX and rates with a unique quantitative equities team. This combination allows us to build high-performing portfolios with a strong risk-control component. 2. Winning Excellence in Innovation – Investment Process Latin America 2026 highlights your approach to investment strategy. Could you elaborate on the innovations within your investment process that differentiate you from peers? As mentioned before, we have built a strong team of portfolio managers and senior analysts who regularly meet with companies and analyze their fundamentals. This team is complemented by a quantitative team that builds predictive models and helps identify new investment ideas and trends. 3. How does your Chief Investment Office structure and decision-making framework contribute to delivering consistent performance and managing risk across diverse portfolios? The role of the CIO is to oversee current investment processes and promote their continuous improvement over time. Nevertheless, each team has sufficient autonomy to build its portfolios within a framework in which alpha generation is complemented by risk control. 4. As the Fastest Growing Asset Management Company in Chile 2026, what factors have driven your recent growth, and how are you ensuring that this expansion remains sustainable over the long term? We have been reaping the benefits of our disciplined and innovative investment process. This process is benchmark-aware but has the flexibility to deviate from benchmarks when appropriate, while avoiding excessive portfolio concentration and continuously monitoring factor, sector, and country exposures.
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We are constantly seeking to improve this process and to attract the best talent in Chile and across the region. This should enable us to continue delivering solid performance over time. 5. LarrainVial has a strong presence across multiple Latin American markets and beyond. How do you tailor your asset management strategies to reflect regional dynamics while maintaining a cohesive global vision? (Wikipedia) Most of the investment team is based in Santiago. This helps us unify criteria, investment processes, training, and views. Nevertheless, our primary focus is on Latin American equities, credit, FX and rates, and Global Macro. Therefore, we believe our expertise and focus are well aligned with this framework. 6. In a rapidly evolving investment environment, how are you integrating responsible investing, ESG considerations, and alternative assets into your offerings to meet changing client expectations? In a way, we have always integrated ESG factors into our investment analysis. Thanks to our quantitative process, we are able to tailor our portfolios to our clients' needs while operating within the constraints of investing in emerging markets. 7. Looking ahead, what are your strategic priorities for the next 3–5 years, and how do you plan to further enhance innovation, client outcomes, and regional leadership in asset management? Our strategic priorities are to continue enhancing our investment processes across the region, particularly by recruiting professionals not only in Chile but also in the major Latin American markets. We believe that Latin American markets will present new and compelling opportunities over the next three years, and we hope to be the partner of choice for international investors as they increasingly recognize that these markets have long been underfollowed and underowned.
INTERVIEW
José Manuel Silva,
Partner and CIO LarrainVial Asset Management Issue 87 | 07
INTERVIEW
Q1: Digital transformation continues to reshape financial services. How is Bank Muamalat leveraging technology to improve customer experience, operational efficiency and financial inclusion while remaining firmly grounded in Shariah principles?
Ultimately, our ambition is not to become more digital for its own sake — it is to become a better, more responsive and more inclusive bank. By combining technology, human understanding and rigorous Shariah governance, we are building a future where innovation strengthens trust and delivers Better Lives, Together.
For Bank Muamalat, digital transformation is not a technology project — it is a continuation of our founding purpose, delivered through new means. Our clearest expression of that is ATLAS by Bank Muamalat, our next-generation Islamic digital banking platform, publicly launched in 2025 and now central to how we reach a new generation of customers. ATLAS exists to make Shariah-compliant banking more accessible and intuitive, without diluting the trust that has always defined Islamic finance.
Q2: Competition across the banking sector continues to intensify, with digital banks and fintech companies entering the market. What differentiates Bank Muamalat’s value proposition, and how do you continue to strengthen customer trust and loyalty?
At Bank Muamalat, Shariah is not a layer added after a product is built — it is embedded from the outset. Every ATLAS journey, from onboarding to financing, is designed around transparency, fairness and the protection of customer interest, because that ethical foundation is what makes innovation trustworthy rather than merely convenient.
Competition is healthy because it challenges every institution to become more relevant, responsive and customer-focused. However, in an environment where technology and digital features can be replicated rapidly, differentiation must go beyond functionality. It must be grounded in purpose, trust and the value an institution consistently delivers to its customers. Bank Muamalat’s distinctive proposition lies in our ability to combine the agility and convenience of modern digital banking with the ethical foundations, discipline and social purpose of Islamic finance.
In practice, this means a fully digital, paperless onboarding experience customers can complete anywhere, at their own pace. Behind that simplicity sits a cloud-native architecture and agile delivery model that let us strengthen operational resilience and respond faster to how customer needs are actually evolving — not how we assumed they would.
Our focus is not on digitalisation for its own sake. We are building an integrated Islamic banking ecosystem that understands customers’ evolving needs and supports them throughout their financial journey. This means delivering seamless experiences, offering transparent and responsible solutions, and using technology to make financial services more accessible, personalised and relevant.
We measure the impact of that investment in three ways. For customers, it means greater convenience, faster service and more personalised financial solutions. For the Bank, it means efficiency, scalability and sharper decision-making. For society, it means we can extend ethical, Shariah-compliant financial services beyond the reach of a physical branch network — reducing the distance, paperwork and friction that have historically excluded people from responsible finance.
Central to this proposition is our commitment to Shariah-compliant banking. Principles such as amanah, or trust; ‘adl, or fairness; and maslahah, or the advancement of wellbeing, shape how we design products, communicate with customers and make decisions. These principles provide customers with confidence that our solutions are not only commercially competitive, but also responsible and aligned with their values.
That last point is where I believe our real contribution lies. Financial inclusion is not a slogan for us; it is a design constraint. Every ATLAS feature is built to widen access to underserved and digitally connected communities, not just to serve customers we already have more conveniently.
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We also recognise that trust is earned through consistent action. It is strengthened when products are clear and transparent, services are reliable, customer concerns are addressed with empathy, and data and transactions are protected. While technology allows us to serve customers faster and more efficiently, human understanding remains essential, particularly when customers require guidance or face financial challenges.
INTERVIEW
Datuk Khairul Kamarudin,
President & CEO Bank Muamalat Malaysia Berhad
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INTERVIEW
Our aim is therefore not merely to acquire customers, but to build enduring relationships with them. We want Bank Muamalat to be a trusted financial partner that supports their aspirations, strengthens their financial resilience and grows alongside them through different stages of life and business. Digital capabilities may shape how banking is delivered, but trust will continue to determine where customers choose to bank and why they remain loyal. By combining innovation with integrity and commercial strength with social purpose, Bank Muamalat is positioning itself as a distinctive, future-ready Islamic bank committed to delivering Better Lives, Together. Q3: Islamic finance is expanding beyond traditional markets. How do you see Malaysia's Islamic banking sector evolving over the next five years, and what role does Bank Muamalat intend to play in that growth? Malaysia’s Islamic banking industry has entered a new phase of maturity. The conversation is no longer centred on whether Islamic banking can compete with conventional finance, but on how it can lead—by offering a model of finance that combines commercial strength with ethical conduct, social impact and sustainable economic growth. Over the next five years, I expect the sector to evolve in several significant ways. Islamic banks will play a greater role in strengthening SMEs, expanding the halal economy, facilitating the transition towards a low-carbon economy and widening access to financial services. Digitalisation will further accelerate this progress by enabling institutions to deliver solutions that are more seamless, personalised and inclusive. Customer expectations will also continue to change. Beyond competitive products and digital convenience, customers increasingly expect financial institutions to demonstrate transparency, responsibility and a clear sense of purpose. This creates a compelling opportunity for Islamic finance, whose principles of fairness, responsible risk-sharing and the protection of society’s broader interests are increasingly relevant to the needs of the modern economy. Malaysia is well positioned to shape this next chapter. We have a comprehensive Islamic financial ecosystem, strong regulatory and Shariah governance frameworks, deep market expertise and a proven capacity for innovation. Our next priority must be to translate these strengths into solutions that are scalable, commercially relevant and capable of creating measurable economic and social value, both domestically and internationally. Bank Muamalat intends to be an active contributor to this growth. We will continue strengthening our retail and SME franchises, supporting entrepreneurs and businesses, and widening access to inclusive financial solutions through areas such as Ar-Rahnu and microfinancing. At the same time, we are investing in digital capabilities to make Islamic banking simpler, faster and more accessible across different customer segments and communities.
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Our role, however, extends beyond providing financing. We want to help customers build financial resilience, enable businesses to grow responsibly and direct capital towards activities that create enduring value for the economy, society and the environment. Every innovation will continue to be supported by strong Shariah governance, disciplined risk management and an unwavering commitment to customer trust. Ultimately, our aspiration is for Bank Muamalat to be more than an Islamic financial institution. We aim to be a trusted partner in Malaysia’s economic transformation and a catalyst for a more inclusive, responsible and sustainable financial system. We will continue advancing an Islamic banking model that is not only relevant to the future, but increasingly preferred for the value it creates for customers, communities and the wider economy. Q4: Bank Muamalat has been recognized as the Fastest Growing Islamic Retail Bank Malaysia 2026. What strategic decisions have been most instrumental in achieving this growth, and how do you plan to sustain this momentum? This recognition validates the strategic direction we have pursued, but more importantly, it reflects the collective commitment and disciplined execution of our people across Bank Muamalat. Our growth has been driven by several deliberate decisions. First, we sharpened our focus on customer segments where we could create meaningful value, particularly in retail banking, home financing, wealth management and inclusive financial solutions. Instead of pursuing growth for its own sake, we focused on understanding customers more deeply and developing relevant solutions around their evolving financial needs. Second, we accelerated our digital transformation. The launch of ATLAS by Bank Muamalat marked an important step in expanding our reach and creating a simpler, more accessible Islamic banking experience. Alongside our physical network, digital capabilities allow us to serve customers more efficiently, respond more quickly to market changes and engage a broader generation of customers. Third, we strengthened execution across the Bank. This involved simplifying processes, improving turnaround times, enhancing distribution capabilities and creating stronger alignment between our business, operations, technology and support functions. Sustainable performance requires the entire organisation to move with a shared purpose and a clear understanding of its priorities. Equally important, we maintained disciplined risk management and strong Shariah governance. Rapid expansion without the appropriate foundations is neither responsible nor sustainable. Our objective has therefore been to achieve quality growth—growth that strengthens the Bank’s fundamentals, protects customer interests and creates long-term value for stakeholders. To sustain this momentum, we will continue investing in digital capabilities, data-driven personalisation and service excellence. We will deepen relationships with existing customers, broaden access to our solutions and strengthen our product propositions across different life stages and customer segments.
INTERVIEW
We view this recognition not as a destination, but as a NAME, responsibility to perform at an even higher level. The next phase --- converting growth into enduring customer relationships, is about --- financial resilience and sustainable value for the Bank and stronger the communities we serve.
At the same time, resilience cannot mean standing still. Customer expectations, technology and the competitive landscape continue to evolve. We must therefore remain willing to challenge established ways of working, simplify the customer journey and invest in capabilities that improve speed, accessibility and service quality.
Q5: Your recognition as Best Islamic Banking CEO Malaysia 2026 reflects your leadership during a period of significant change for the banking industry. How have you balanced resilience, innovation and sustainable growth amid economic uncertainty, regulatory developments and evolving customer expectations?
The balance lies in pursuing innovation responsibly. We assess new initiatives not only according to their commercial potential, but also by whether they address genuine customer needs, remain within our risk appetite and uphold Shariah principles. This allows us to move forward with ambition while maintaining the trust that is fundamental to banking.
I receive this recognition with humility because leadership outcomes are never achieved by one individual. It reflects the dedication of our employees, the guidance of our Board, the confidence of our shareholders and the trust placed in us by our customers and stakeholders.
Sustainable growth also requires us to look beyond short-term financial outcomes. We consider how our decisions affect customers, employees, communities and the broader economy. During periods of uncertainty, a bank must not only protect its own resilience; it must also help customers and businesses navigate financial pressures and build their capacity to recover and grow.
Leading through uncertainty requires clarity of purpose and discipline in execution. For Bank Muamalat, resilience begins with strong fundamentals—sound governance, prudent capital and liquidity management, responsible risk-taking and close attention to asset quality. These foundations provide the confidence and capacity to continue investing for the future, even when the operating environment is challenging.
Q6: Looking ahead, what is your long-term vision for Bank Muamalat and what milestones would you like investors, customers and stakeholders to associate with the bank over the next three to five years? My long-term vision is for Bank Muamalat to be recognised as one of Malaysia’s most trusted, progressive and purpose-driven Islamic financial institutions, commercially strong, digitally capable and distinguished by the positive value we create for customers and society.
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INTERVIEW
Over the next three to five years, I would like our stakeholders to associate Bank Muamalat with several defining achievements. For our customers, we aim to deliver an experience that is seamless, personalised and consistent across every channel. Whether customers engage with us digitally or through our branches, they should experience a bank that understands their needs, responds with speed and treats them with fairness and empathy. For investors and shareholders, we intend to demonstrate resilient and sustainable performance supported by quality growth, disciplined risk management, operational efficiency and sound governance. Our success should not be measured by scale alone, but by the strength and durability of the value we create. For businesses and entrepreneurs, particularly SMEs, we want to be recognised as a trusted growth partner—providing not only financing, but also solutions, guidance and access that help them expand responsibly and contribute to Malaysia’s economic development. For communities, we aspire to broaden financial inclusion and strengthen financial resilience. Through inclusive financing, ArRahnu, microfinancing and social finance initiatives, we want to ensure that Islamic finance reaches those who can benefit from it most. We also want Bank Muamalat to be recognised for responsible innovation. This means building on the foundation established through ATLAS, using technology and data to serve customers more effectively, and embedding sustainability and Shariah principles into how we design solutions and allocate capital.
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Most importantly, I want Bank Muamalat to remain an institution that people trust—customers with their financial aspirations, employees with their careers, investors with their capital and communities with their hopes for a more inclusive financial inclusion and strengthen financial resilience. Through inclusive financing, Ar-Rahnu, microfinancing and social finance initiatives, we want to ensure that Islamic finance reaches those who can benefit from it most. Q7: ESG and ethical finance are becoming increasingly important to investors worldwide. How does Bank Muamalat integrate sustainability into its business strategy, and where do you see the greatest opportunities in responsible Islamic finance? At Bank Muamalat, sustainability is not a separate agenda, it is integral to our purpose and identity as an Islamic financial institution. Our approach is anchored in Maqasid al-Shariah, with Value-based Intermediation providing the framework for translating these principles into how we conduct our business, allocate capital, manage risk and create long-term value. We believe responsible Islamic finance extends beyond providing financing. It is about directing capital towards activities that generate positive economic, social and environmental outcomes while promoting fairness, inclusion and shared prosperity. This is reflected in our commitment to widening financial access, empowering underserved communities, supporting SMEs and entrepreneurs, and developing solutions that contribute to more resilient businesses and sustainable livelihoods. Looking ahead, we see significant opportunities in three areas: transition financing, inclusive and social finance, and sustainable SME development. Malaysia’s transition towards a greener and more resilient economy will require substantial investment, and Islamic finance is well positioned to mobilise capital towards projects and businesses that create measurable long-term value.
INTERVIEW
SMEs represent a particularly important opportunity. Many require not only access to financing, but also a trusted financial partner that can help them understand evolving sustainability expectations and progressively transition towards more responsible business practices. Our role is to facilitate that journey through practical, accessible and value-driven solutions. There is also significant potential to strengthen the integration of commercial and social finance. Instruments such as zakat, waqf and sadaqah, when combined with innovative financing structures and digital capabilities, can help address financial exclusion and create pathways towards greater economic participation. The principles underlying ESG are deeply aligned with Islamic finance. The opportunity now is to translate that natural alignment into scalable solutions and measurable outcomes. By combining Maqasid al-Shariah, Value-based Intermediation and purposeful innovation, Bank Muamalat aims to contribute to a more inclusive, resilient and sustainable economy while creating lasting value for our customers, investors, communities and future generations. Q8: Small and medium-sized enterprises are a key driver of Malaysia's economy. How is Bank Muamalat supporting SMEs through innovative financing solutions while maintaining sound credit quality and risk management? SMEs are fundamental to Malaysia’s economy—not only as contributors to growth, but also as generators of employment, innovation and opportunities across communities. Supporting their development is therefore both a commercial priority and an important part of Bank Muamalat’s broader purpose. Our approach is to support SMEs throughout their business lifecycle. Our Shariah-compliant solutions include working capital, trade and contract financing, Muamalat Hire Purchase-i, Industrial Hire Purchase-i and government-guaranteed financing
programmes. These facilities help businesses manage cash flow, acquire productive assets, fulfil contracts, expand their operations and pursue new market opportunities. However, SMEs require more than access to capital. They also need a banking partner that understands their business, responds promptly and provides solutions suited to their circumstances. We are therefore simplifying processes, improving turnaround times and strengthening coordination across our business and distribution network to deliver a more seamless and responsive experience. This strategy has produced strong results. Over the past three years, Bank Muamalat’s SME financing portfolio grew by approximately 33%, including 23% year-on-year growth in 2025. These achievements reflect both the strength of market demand and the confidence businesses place in Bank Muamalat as a trusted financial partner. We are equally clear that growth must never come at the expense of financing quality. Each application is assessed against the viability of the business, the resilience of its cash flow, payment capacity, management capability and overall risk profile. This is supported by prudent underwriting, portfolio monitoring, early-warning mechanisms and robust risk governance. Technology and data will increasingly strengthen this approach. Better insights can help us understand customers more comprehensively, improve decision-making and identify emerging risks earlier. At the same time, responsible financing means engaging customers proactively and supporting viable businesses in navigating periods of pressure. Our priority is quality growth: expanding access to financing while protecting asset quality and ensuring that the businesses we support are positioned to grow sustainably. By combining customer understanding, innovative Shariah-compliant solutions and disciplined risk management, Bank Muamalat will continue empowering SMEs and contributing meaningfully to Malaysia’s long-term economic development.
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FINANCE
Why Connected Finance Is Transforming Corporate Performance Connected finance is the integration of finance with the wider business through shared data, interoperable systems, and collaborative decision-making. Instead of operating as isolated functions, finance increasingly connects with: • Operations • Procurement • Sales • Human resources • Supply chain • Treasury • Risk management • Customer platforms This integration creates a continuous flow of information that improves planning, reporting, forecasting, and operational execution. Why Finance Is Becoming More Connected Business decisions increasingly require access to current, accurate, and enterprise-wide information. Organizations are responding by integrating finance into broader digital ecosystems that provide: • Real-time visibility • Faster reporting • Better forecasting • Improved collaboration • Consistent performance measurement • Stronger governance Connected finance reduces information silos and enables leaders to make decisions using shared, reliable data across the organization. Deloitte describes connected planning as linking financial and operational information to create a "single version of the truth" for decision-making. (Deloitte)
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From Periodic Reporting to Continuous Insight Traditional finance often depended on monthly or quarterly reporting cycles. Connected finance enables continuous access to information through: • Live dashboards • Automated reporting • Integrated ERP systems • Cloud data platforms • Business intelligence tools Rather than waiting for historical reports, decision-makers can monitor financial performance as business conditions evolve. This supports more agile responses to changing market conditions. The Role of Cloud ERP Platforms Cloud-based ERP systems provide the technological foundation for connected finance. These platforms bring together: • Financial accounting • Procurement • Inventory • Human resources • Supply chain • Project management • Customer information By centralizing information, organizations improve data consistency while reducing duplication and manual reconciliation. Deloitte emphasizes that modern ERP strategies are most successful when they create integrated finance capabilities supported by standardized data and enterprise-wide visibility. (Deloitte) APIs Are Connecting Financial Ecosystems Application Programming Interfaces (APIs) have become essential to connected finance.
FINANCE
APIs allow different software platforms to exchange information securely and efficiently. Common integrations include: • Banking connectivity • Treasury systems • Payment platforms • ERP software • Expense management • Procurement applications • Customer platforms McKinsey notes that APIs have evolved from technical integration tools into strategic business assets that improve automation, customer experience, and innovation across financial services. Banks increasingly view APIs as a priority for both business and IT functions. (McKinsey & Company) Connected Finance Improves Decision-Making Financial leaders increasingly require insights that combine financial and operational information. Examples include: • Revenue trends alongside customer activity • Cash flow linked to procurement • Inventory connected to working capital • Workforce planning aligned with budgets • Sales forecasts integrated with production By connecting these data sources, organizations gain a more complete understanding of business performance. Real-Time Data Is Changing Financial Management Real-time financial information supports faster and more informed decision-making.
Benefits include: • Improved cash visibility • Faster variance analysis • Better liquidity management • Earlier identification of risks • Quicker performance adjustments Organizations no longer need to wait until month-end to understand financial performance. Automation Supports Connected Finance Automation reduces manual work while improving consistency and accuracy. Finance teams increasingly automate: • Invoice processing • Reconciliations • Expense approvals • Payment workflows • Financial reporting • Compliance documentation Automation also frees finance professionals to spend more time on planning, analysis, and strategic advisory work. Artificial Intelligence Expands Financial Insight AI is enhancing connected finance by analyzing large volumes of financial and operational data. Common applications include: • Forecasting • Cash flow prediction • Anomaly detection • Fraud monitoring • Financial planning • Scenario modelling
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FINANCE
Rather than replacing finance professionals, AI provides additional analytical capabilities that improve decision support.
Treasury Is Becoming More Connected Corporate treasury increasingly operates through integrated digital platforms. Connected treasury capabilities include: • Real-time cash management • Banking connectivity • Foreign exchange management • Liquidity forecasting • Payment automation McKinsey notes that API-enabled transaction banking allows businesses to integrate treasury and banking services directly into enterprise systems, improving efficiency and working capital management. (McKinsey & Company) Embedded Finance Is Changing Corporate Workflows Financial services are increasingly being embedded directly into business software. Examples include: • Payments within ERP systems • Invoice financing in procurement platforms • Treasury tools inside enterprise software • Banking integrated into accounting systems Deloitte highlights that commercial embedded banking enables organizations to access financial services within their operational workflows, reducing friction and improving efficiency. The firm also notes that many corporate clients prioritize ERP connectivity when selecting banking partners. (Deloitte) Data Quality Is a Competitive Advantage Connected finance depends on trustworthy data. Organizations are strengthening: • Data governance • Master data management • Data quality controls • Standardized reporting • Shared information models Reliable information supports stronger forecasting and more confident business decisions.
Business Area
Potential Benefits
Financial Reporting Cash Management Planning Operations Decision-Making Productivity
Greater accuracy and faster reporting Improved liquidity visibility Better forecasting and scenario analysis Stronger coordination between departments Faster access to reliable information Reduced manual administrative work
Performance improvements are often achieved through better coordination rather than isolated technology investments. Governance and Risk Management As finance becomes more connected, governance becomes increasingly important. Organizations focus on: • Access controls • Audit trails • Data security • Regulatory compliance • Financial transparency • Risk monitoring Integrated governance strengthens confidence in financial information while supporting effective oversight. Common Challenges Organizations may encounter several implementation challenges. These include: • Legacy technology • Fragmented data • Integration complexity • Skills shortages • Change management • Cybersecurity requirements • Inconsistent reporting standards Successful transformation typically combines technology modernization with process redesign and organizational alignment. Characteristics of High-Performing Connected Finance Functions Organizations achieving strong results often share several characteristics. Integrated Data Finance and operational information are connected across the enterprise.
Measuring the Impact on Corporate Performance
Cloud-Based Platforms
Connected finance contributes to performance improvements across several areas.
Scalable digital infrastructure supports continuous improvement.
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FINANCE
Automation Routine processes are increasingly automated. Cross-Functional Collaboration
• Automating repetitive workflows • Building enterprise-wide reporting standards • Investing in analytics capabilities • Strengthening collaboration between finance and operations
Finance works closely with operational teams.
These initiatives create stronger foundations for sustainable performance improvements.
Advanced Analytics
Future Outlook
Decision-making is supported by timely insights.
Connected finance is expected to become a defining capability of highperforming organizations. As cloud computing, AI, APIs, embedded finance, and enterprise analytics continue to mature, finance functions will become increasingly integrated with every aspect of business operations.
Continuous Improvement Processes evolve as business requirements change. Emerging Trends Several developments are shaping the future of connected finance. These include: • AI-assisted financial planning • Connected treasury platforms • API-first banking • Embedded finance • Intelligent forecasting • Real-time financial analytics • Digital finance ecosystems Research on ERP and API banking integration also indicates that combining enterprise systems with banking APIs improves data accuracy, reduces manual processing, and enables real-time financial visibility for organizations. (IDEAS/RePEc) Strategic Recommendations Organizations seeking to strengthen connected finance should consider: • Modernizing ERP platforms • Improving data governance • Expanding API connectivity
The future finance organization will likely spend less time gathering information and more time interpreting it, supporting strategic planning, and enabling faster, evidence-based decisions. Organizations that establish connected finance capabilities today are likely to be better positioned to improve operational agility, strengthen financial resilience, and respond effectively to changing business conditions. Conclusion Connected finance represents a significant evolution in how organizations manage financial operations and business performance. By integrating financial information with operational data, digital technologies, and enterprise-wide processes, organizations gain greater visibility, faster insights, and stronger decision-making capabilities. Cloud ERP platforms, APIs, automation, embedded finance, and AI are enabling finance teams to move beyond transactional responsibilities and contribute more directly to strategic planning and organizational performance. As businesses continue to invest in digital transformation, connected finance is becoming not simply a technology initiative but a foundational capability that supports sustainable growth, resilience, and long-term competitiveness.
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BUSINESS
Business Resilience in 2026: Why Operational Preparedness Has Become Every Company’s Competitive Advantage What Is Business Resilience?
The Five Foundations of Operational Resilience
Business resilience refers to an organization's ability to anticipate, prepare for, respond to, and recover from operational disruptions while continuing to deliver products, services, and value to customers.
1. Supply Chain Visibility
Modern resilience extends well beyond disaster recovery. It encompasses: • Strategic planning • Operational flexibility • Financial discipline • Digital infrastructure • Workforce adaptability • Supplier diversification • Governance and risk oversight Rather than focusing solely on avoiding disruption, resilient businesses build systems capable of adapting as conditions evolve. Why Business Resilience Matters More Than Ever The business environment has become increasingly interconnected. Companies now operate across global supplier networks, digital platforms, cloud infrastructure, remote workforces, and international customer bases. While these developments create opportunities for growth, they also introduce additional operational complexity. According to the OECD's 2025 Supply Chain Resilience Review, strengthening resilience depends more on improving flexibility, regulatory cooperation, and digital capabilities than simply relocating production. The report warns that broad reshoring efforts could reduce global trade by more than 18% and shrink global GDP by over 5%. (OECD) This demonstrates why resilience increasingly relies on smarter operations rather than greater complexity.
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Organizations are investing in technologies that provide real-time visibility across suppliers, logistics providers, inventories, and production facilities. Greater transparency enables faster responses to unexpected events. OECD research identifies digitalization and improved data flows as major contributors to resilient supply chains. (OECD) 2. Digital Infrastructure Cloud computing, automation, AI-assisted analytics, and integrated business platforms improve operational continuity. Digital systems help organizations monitor operations continuously while supporting faster decision-making. Rather than replacing human judgment, technology increasingly augments business resilience through improved information availability. 3. Workforce Adaptability Resilient organizations invest in continuous learning and cross-functional collaboration. Employees capable of adapting to changing roles and technologies help companies respond more effectively to evolving market conditions. Flexible organizational structures often outperform rigid hierarchical models during periods of uncertainty. 4. Financial Preparedness Healthy balance sheets remain essential. Organizations with stronger liquidity, diversified revenue streams, and disciplined capital allocation generally have greater flexibility when responding to unexpected disruptions. Financial resilience supports operational resilience.
BUSINESS
5. Governance and Risk Management Board-level oversight increasingly includes enterprise resilience. Risk management has expanded beyond compliance to include: • Operational risks • Technology risks • Supplier risks • Talent risks • Reputation risks Integrated governance improves strategic decision-making across the organization.
Key business practices include: • Multi-supplier strategies • Improved logistics planning • Inventory optimization • Regional diversification • Supplier collaboration • Digital monitoring These measures help reduce operational interruptions without sacrificing competitiveness. Cybersecurity Is Now Part of Business Resilience
Digital Transformation Is Strengthening Business Resilience
Operational resilience increasingly includes cybersecurity.
Digital transformation is no longer viewed solely as an efficiency initiative.
The World Economic Forum's Global Cybersecurity Outlook 2025 reports that 54% of large organizations identify supply chain challenges as the greatest barrier to cyber resilience. (World Economic Forum)
It increasingly supports: • Business continuity • Remote operations • Process automation • Customer experience • Predictive analytics • Data-driven decision making Organizations that integrate technology strategically often recover more quickly from operational disruptions while maintaining service quality. Supply Chain Resilience Has Become a Strategic Priority Supply chains remain among the most significant operational challenges facing businesses. The OECD notes that resilience depends on diversification, coordination, and digital tools rather than excessive concentration or protectionism. (OECD)
Business leaders are expanding resilience strategies to include: • Third-party risk management • Continuous monitoring • Incident response planning • Data governance • Employee awareness Cyber resilience supports business continuity by reducing operational disruptions. Leadership Plays a Critical Role Resilience begins with leadership. Executive teams establish priorities that influence investment decisions, organizational culture, and long-term planning.
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Successful leaders often focus on: • Long-term value creation • Transparent communication • Scenario planning • Continuous improvement • Strategic flexibility Organizations that encourage informed decision-making throughout the business generally respond more effectively to changing market conditions. Building a Culture of Resilience Technology alone cannot create resilient organizations. Culture remains equally important. Characteristics frequently associated with resilient companies include: • Collaboration • Continuous learning • Accountability • Innovation • Customer focus • Adaptability Employees who understand organizational priorities contribute to faster and more coordinated responses during periods of change. The Competitive Benefits of Business Resilience Organizations that strengthen resilience often experience broader business benefits beyond risk reduction. These may include: • Improved customer confidence • Greater operational efficiency • Stronger supplier relationships • Faster innovation cycles • Better financial performance • Enhanced brand reputation
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Resilience increasingly supports sustainable growth rather than simply protecting against disruption. Future Outlook Business resilience will continue evolving alongside advances in artificial intelligence, automation, digital infrastructure, and global collaboration. Future investment priorities are expected to include: • Predictive analytics • Intelligent automation • AI-assisted planning • Supply chain transparency • Workforce development • Enterprise-wide risk visibility Organizations that integrate these capabilities thoughtfully may improve both operational performance and long-term competitiveness. Conclusion Business resilience has become one of the defining characteristics of successful organizations. Rather than focusing exclusively on crisis response, resilient businesses invest in operational excellence, adaptable leadership, digital capabilities, financial discipline, and collaborative cultures. As economic conditions, technology, and customer expectations continue evolving, resilience is increasingly becoming a long-term strategic capability that supports innovation, sustainable growth, and competitive advantage. Companies that strengthen resilience today are likely to be better positioned to navigate tomorrow's challenges while continuing to create lasting value for customers, employees, and stakeholders.
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How High-Performing Organizations Build Long-Term Momentum Business momentum refers to an organization's ability to sustain progress over an extended period while continuously adapting to new opportunities and challenges. Unlike short-term growth, momentum reflects an organization's capacity to: • Deliver consistent operational performance • Maintain strategic focus • Innovate continuously • Strengthen customer relationships • Develop people and leadership • Improve productivity over time Momentum is cumulative. Each improvement strengthens the organization's ability to achieve the next. Why Long-Term Momentum Matters More Than Short-Term Wins Many organizations can achieve temporary success through favorable market conditions, product launches, or cost reductions. Sustained performance is different. Organizations with long-term momentum are generally better positioned to: • Navigate economic uncertainty • Respond to technological change • Retain skilled employees • Build customer trust • Invest confidently • Pursue innovation consistently McKinsey's research indicates that healthier organizations outperform less healthy peers over time and are significantly more likely to sustain superior financial performance. (McKinsey & Company) A Clear Strategic Direction High-performing organizations rarely attempt to pursue every opportunity simultaneously.
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Instead, they establish: • Clear priorities • Measurable objectives • Consistent decision-making • Long-term investment discipline Strategic clarity enables employees throughout the organization to understand how their work contributes to broader business goals. Organizations with aligned strategies generally execute more efficiently because resources remain focused on high-value initiatives. Organizational Health Creates Sustainable Performance Long-term momentum depends on more than financial metrics. McKinsey defines organizational health as the ability to: • Align around common objectives • Execute effectively • Adapt continuously Its research shows that organizational health remains one of the strongest predictors of sustained business performance and long-term value creation. Organizations with stronger health scores demonstrate greater resilience, improved execution, and stronger long-term outcomes. (McKinsey & Company) Healthy organizations continually improve rather than waiting for major transformations. Leadership That Builds Capability Successful organizations develop leaders who create long-term capability instead of relying solely on individual performance. Effective leadership often emphasizes: • Clear communication • Accountability • Coaching • Collaboration • Adaptability • Long-term thinking
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Rather than solving every problem directly, leaders establish systems that enable teams to make informed decisions independently. This creates organizational resilience that extends beyond individual executives. A Culture of Continuous Improvement Momentum grows when improvement becomes part of everyday operations. Organizations that continuously evaluate and refine processes often identify opportunities before problems become significant. Continuous improvement may include: • Regular process reviews • Employee feedback • Operational measurement • Knowledge sharing • Cross-functional collaboration Rather than treating change as a periodic initiative, highperforming organizations integrate improvement into normal business activities. Investment in People Remains Essential Technology continues to transform organizations, but people remain central to long-term success. Leading organizations invest in: • Skills development • Leadership programs • Career progression • Knowledge sharing • Employee engagement • Cross-functional learning McKinsey's State of Organizations 2026 highlights that organizations balancing investment in people and performance are substantially more likely to sustain top-tier financial results over time while achieving stronger revenue growth. (McKinsey & Company)
Operational Excellence Supports Consistency Consistent execution builds confidence across customers, employees, and stakeholders. Operational excellence focuses on: • Standardized processes • Quality management • Performance measurement • Efficient resource allocation • Continuous optimization Reliable operations reduce unnecessary complexity while enabling organizations to scale effectively. Technology Enables Better Decision-Making Modern organizations increasingly rely on digital technologies to improve visibility across operations. These include: • Business intelligence platforms • Cloud infrastructure • Automation • Artificial intelligence • Data analytics • Collaboration platforms Technology is most valuable when it enhances decision quality rather than simply increasing speed. Organizations increasingly integrate digital capabilities into broader business strategy rather than treating technology as a separate function. Innovation Is a Continuous Process Innovation is rarely confined to research and development departments. High-performing organizations encourage innovation through: • Customer feedback • Employee suggestions • Data insights • Cross-functional collaboration • Incremental experimentation
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BUSINESS Small improvements accumulated over time often generate significant long-term competitive advantages. Agility Without Losing Direction Business conditions continue to evolve rapidly. Organizations with lasting momentum combine: • Strategic consistency • Operational flexibility This balance allows businesses to respond quickly without abandoning long-term objectives. Adaptability becomes an organizational capability rather than a reactive response. Customer-Centered Thinking Organizations that maintain long-term momentum consistently evaluate how customer expectations evolve. This includes improving: • Service quality • Digital experiences • Product reliability • Responsiveness • Communication
Common Challenges Organizations often struggle to maintain momentum because of: • Short-term decision making • Fragmented priorities • Organizational complexity • Legacy systems • Poor communication • Inconsistent leadership • Skills gaps • Limited collaboration Addressing these challenges requires coordinated improvements rather than isolated initiatives. Research from the OECD indicates that organizational improvements are most effective when changes to management practices, technology adoption, and operational processes are implemented together. (OECD) Characteristics of High-Performing Organizations Organizations that sustain momentum over many years often demonstrate several common characteristics. Strategic Consistency Long-term priorities remain stable despite short-term fluctuations. Strong Organizational Health Teams align around shared goals while continuously improving execution.
Long-term customer relationships often provide stability that supports sustainable growth.
Continuous Learning
Measuring Progress Beyond Financial Results
Employees develop new capabilities throughout their careers.
Financial performance remains important, but high-performing organizations increasingly monitor broader indicators.
Data-Informed Decisions
Area
Example Metrics
Financial Revenue growth, profitability Customers Satisfaction, retention Operations Productivity, cycle time People Engagement, retention, skills development Innovation New products, process improvements Strategy Goal achievement, execution progress Balanced performance measurement supports more informed long-term decision-making.
Reliable information supports better planning and execution. Adaptability Organizations evolve without losing strategic focus. Operational Discipline Processes improve consistently through measurement and refinement. Emerging Trends
Governance Strengthens Momentum
Several developments are influencing how organizations build long-term momentum.
Strong governance supports sustainable growth by improving consistency and accountability.
These include:
Important governance practices include: • Transparent decision-making • Risk management • Ethical leadership • Performance reviews • Clear responsibilities Good governance enables organizations to make confident decisions while supporting long-term resilience.
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• AI-assisted decision support • Intelligent automation • Hybrid workforce models • Skills-based talent strategies • Data-driven leadership • Cross-functional operating models • Continuous business transformation
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McKinsey's State of Organizations 2026 identifies technology adoption, evolving workforce expectations, and organizational adaptability as defining factors shaping future business performance. (McKinsey & Company) Strategic Recommendations Organizations seeking sustainable momentum should consider: • Defining clear long-term priorities • Investing in leadership development • Strengthening organizational health • Building data capabilities • Encouraging continuous learning • Improving operational discipline • Measuring progress across multiple performance indicators • Embedding innovation into daily operations These practices support steady improvement rather than episodic transformation. Future Outlook As technology, workforce expectations, and competitive dynamics continue to evolve, organizations will increasingly compete on their ability to learn, adapt, and execute consistently.
Long-term momentum will depend less on isolated initiatives and more on integrated capabilities that connect leadership, people, technology, operations, and strategy. Organizations that cultivate resilience, continuous improvement, and organizational health are likely to remain better positioned for sustainable growth in an increasingly dynamic business environment. (McKinsey & Company) Conclusion High-performing organizations rarely rely on momentum created by a single product, market opportunity, or strategic initiative. Instead, they establish systems that allow performance to compound over time through disciplined leadership, healthy organizational cultures, continuous learning, operational excellence, and thoughtful investment in people and technology. While market conditions will continue to evolve, organizations that consistently align strategy with execution, encourage innovation, and strengthen organizational capability are better equipped to sustain progress over the long term. Building momentum is not simply about moving faster—it is about creating an organization capable of improving continuously, adapting confidently, and delivering value consistently.
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Operational Efficiency Strategy: Why the Modern Operating Model Has Become a Competitive Advantage The business case for efficiency is stronger than it has been in years because the global productivity backdrop remains demanding. The World Bank’s research on global productivity says the world entered the pandemic after a decade of broadbased productivity deceleration, and the OECD’s 2026 productivity compendium says multifactor productivity has continued the downward trend visible since the 2000s. That combination matters because it means many firms can no longer rely on favorable external conditions to offset internal inefficiencies. Sustainable performance increasingly depends on execution quality inside the firm. [3] At the same time, the opportunity side of the equation has expanded. The OECD states that digital transformation is accelerating worldwide and affecting all sectors, while its digital economy work shows countries and firms are increasingly using ICT and internet-based capabilities to meet economic and operational objectives. In plain business terms, this creates a sharper divide between firms that use digital tools to redesign work and firms that layer new software onto old processes without changing how decisions and accountability actually work. [4] IMF research reinforces this point by emphasizing that even in advanced economies, most firms are not at the frontier, which suggests large payoffs from broader technology adoption and diffusion. The IMF also notes that digitalization, AI, and related technologies can increase productivity and innovation, even though the scale of gains depends on how effectively firms absorb and apply them. That is why efficiency is now a boardroom issue rather than just an operations issue: value comes not from buying tools alone, but from building the organizational capacity to use them well. [5] The World Bank’s Productivity Project reaches a similar conclusion from a firm-growth perspective. Its work argues that high growth alone is not enough; what matters is the quality of growth, supported by innovation, managerial skills, and the ability to leverage broader linkages. This is a useful correction to the old assumption that scale by itself produces efficiency. In modern business, scale without managerial quality often multiplies friction, weak handoffs, and poor capital allocation. [6] This shift also changes the language of performance measurement. Many companies still talk about efficiency as if it
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were a narrow ratio or a one-time cost program. A better framing is that efficiency reflects how effectively an enterprise converts talent, technology, time, and capital into customer value and profitable growth. That broader definition is more consistent with OECD work on productivity, World Bank work on firm capability, and consulting research showing that clarity, speed, skills, and commitment drive superior outcomes. [7] How the modern operating model turns strategy into results A modern operating model is best understood as the system that connects strategy to daily execution. McKinsey defines it as the backbone of the organization and says it guides decision-making, resource allocation, innovation, and other essential activities in service of efficiency and sustainable growth. That definition matters because it moves the conversation beyond organizational charts. An operating model is not merely structure; it is the logic of how work gets done. [8] McKinsey’s recent research is especially useful here because it quantifies the execution problem. In one summary, the firm says even high-performing companies can have a 30 percent gap between the full potential of their strategy and the value actually delivered, with shortcomings in the operating model playing a significant role. This is one of the clearest arguments for why executive teams should treat operating design as a performance discipline rather than an internal administrative exercise. [9] The same research also shows how broad the operating model has become. McKinsey’s framework includes twelve interconnected elements, including value agenda, governance, processes, technology, behaviors, rewards, and talent. This matters because efficiency is rarely the result of one isolated fix. Faster workflows will not hold if incentives reward local optimization over enterprise outcomes. Better technology will not create value if governance slows decisions. More data will not improve performance if managers are unclear about ownership. [8] This systems view aligns with what Deloitte and BCG emphasize in their own way. Deloitte’s operations excellence work focuses on reimagining operations, modernizing core processes, improving service, and achieving sustainable operational efficiencies through insights and solutions. BCG warns that many organizations are burdened by internal complicatedness, meaning cumbersome structures, processes, and systems that suppress performance and growth. Both perspectives point to the same commercial reality:
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operating advantage comes from simplification, redesign, and disciplined execution, not from adding another layer of coordination on top of existing complexity. [10] The strategic payoff can be substantial. McKinsey says welldesigned operating shifts can produce up to a 30 percent improvement in customer satisfaction, operational performance, and efficiency, alongside much faster change and decision-making. Business leaders do not need to treat those figures as guarantees to draw the core lesson: firms that improve how they align priorities, processes, technology, and talent usually gain both cost benefits and growth benefits. In other words, modern efficiency is dualpurpose. It protects margins while improving the organization’s ability to move. [8] One reason this matters for Companies Digest readers is that it reframes operational excellence as a source of competitive positioning, not just internal hygiene. When customer expectations change quickly and digital tools spread unevenly, the faster, clearer, and simpler organization often outperforms the larger but more tangled one. That is why the operating model has become a competitive asset in its own right. [11] Where sustainable efficiency gains actually come from Sustainable efficiency gains usually begin with process design, not software procurement. Deloitte’s operational excellence work explicitly ties efficiency to the redesign and modernization of core
processes, while McKinsey’s operating model framework highlights workflows, governance, and clarity of accountability as fundamental performance links. Companies that still treat process redesign as a back-office exercise often miss the bigger point: core workflows determine cycle time, error rates, customer experience, rework, and the speed of resource deployment. [12] Digital adoption is the second major source of gains, but the evidence shows that not all adoption is equal. OECD research on firm-level evidence from EU countries finds robust evidence that digital adoption in an industry is associated with productivity gains at the firm level. The same body of work suggests stronger effects in some activity types, which reinforces a practical point for executives: businesses should adopt technology where it changes high-volume or highfriction workflows, not where it simply adds another dashboard. [13] Artificial intelligence may deepen this opportunity, but only when complementary capabilities are in place. The OECD says AI adoption can significantly boost firm productivity, with top-performing companies showing nearly double the adoption rates of the least productive firms. However, the same OECD work stresses that firms need complementary assets such as ICT infrastructure, management capabilities, and human capital to realize the full benefits. That finding is especially important because it counters the simplistic belief that AI alone will deliver a productivity miracle. In practice, AI amplifies the strengths or weaknesses already embedded in the operating model. [14]
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Management quality is the third major lever, and it is often underrated because it sounds less tangible than technology. OECD research on management, skills, and productivity finds that investment in organizational capital and workforce skills is tied to productivity. World Bank research on small firms likewise shows that variation in business practices explains significant differences in sales, profits, labor productivity, and total factor productivity. Taken together, these sources support a durable lesson: better management is not soft infrastructure. It is hard economic infrastructure inside the firm. [15]
that sequence often produces fragmented systems rather than leaner operations. [18]
Complexity reduction is the fourth lever, and it deserves more executive attention than it often gets. BCG argues that internal complicatedness in structures, processes, and systems can stifle performance and growth. Deloitte’s 2025 human capital research adds a striking organizational signal: only 22 percent of surveyed respondents said their organizations were highly effective at simplifying work. This suggests that many companies are not constrained by a lack of strategic ideas; they are constrained by unnecessary tasks, overlapping approvals, diffuse ownership, and coordination burdens that consume capacity before value can be created. [16]
Business leaders should begin by defining efficiency in enterprise terms rather than departmental terms. That means linking efficiency goals to a clear value agenda: faster cycle times, cleaner handoffs, better customer outcomes, stronger decision quality, and higher output from existing capabilities. McKinsey’s operating model work emphasizes that the value agenda and governance structure should align resource allocation with strategy. Without that alignment, many efficiency programs create local savings while weakening the broader system. [20]
This is where the idea of organizational capacity becomes commercially useful. Deloitte argues that reclaiming capacity is about more than squeezing current resources harder; it is about freeing people for new work, improved responsiveness, and better performance. In growth terms, that means efficiency should create headroom for innovation, customer responsiveness, and faster experimentation. A company that uses simplification only to reduce spend may capture short-term savings; a company that uses simplification to redeploy energy into higher-value work usually captures a more durable advantage. [17] SMEs face a related but slightly different challenge. The OECD notes that smaller firms often lag in digital transformation even though the tools available to them can improve performance and help overcome size-based constraints. For business leaders in smaller or midsized firms, this means efficiency strategy is often about sequencing: first simplify and standardize the work, then digitize the right processes, then build the management capabilities and skills required to scale the gains. Skipping
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The deeper economic lesson is that firms do not achieve meaningful productivity gains by chasing isolated savings. They achieve them by combining four things consistently: clearer priorities, better process architecture, stronger management discipline, and digital tools that fit the work rather than distort it. That is the operating model logic behind sustainable efficiency. [19] Practical recommendations for business leaders
The second step is to redesign a small number of mission-critical workflows end to end. This is more effective than launching dozens of disconnected productivity projects. Deloitte’s operations excellence approach and McKinsey’s process-centered view both imply that the biggest gains come from tackling core processes where delay, duplication, or quality leakage are most expensive. For many firms, that includes order-to-cash, service delivery, product development, procurement, and management reporting. [12] The third step is to invest in complementary assets before expecting technology to transform performance. OECD and IMF research both show that adoption alone is not enough; firms need skills, infrastructure, management quality, and the ability to absorb new tools into real workflows. This is particularly true for AI, where productivity benefits depend on clean data, usable processes, governance, and worker capability. Leaders should therefore budget for enablement, not just licenses. [21] The fourth step is to simplify decision rights and reduce organizational drag. BCG’s warning about internal complicatedness and Deloitte’s findings on low levels of work simplification suggest that many firms have more friction than they realize. Executive teams should identify where approvals stack up, where activities lack a clear owner, where metrics conflict, and where reporting layers slow
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adaptation. Simplification is not about removing rigor; it is about ensuring that rigor is applied where it creates value rather than where it merely preserves legacy habits. [16] The fifth step is to treat management quality as a measurable capability. The OECD and World Bank both provide strong evidence that management practices and organizational capital matter for productivity. That means companies should train managers not only in people leadership, but also in workflow design, prioritization, rootcause analysis, performance review, and technology-enabled decision-making. In many organizations, the middlemanagement layer is the decisive link between strategy and productivity. [15] Finally, leaders should build efficiency into a continuing operating cadence rather than a one-off program. McKinsey’s operating model research stresses redesign readiness and continuous alignment, while BCG’s transformation work emphasizes sustained value creation and durable capability building. Companies that treat efficiency as episodic often experience “boomerang complexity,” where old habits return after the formal program ends. Continuous improvement, by contrast, makes efficiency self-reinforcing. [22]
Is operational efficiency just another term for cost cutting? No. Cost control can be part of it, but the broader goal is to improve execution, reduce friction, raise service quality, and create more capacity for growth and innovation. [24] What role does the operating model play in business performance? The operating model connects strategy to execution by shaping decision-making, accountability, workflows, technology use, and talent deployment. [20] Do digital tools automatically improve productivity? No. OECD and IMF research both indicate that productivity gains depend on effective adoption, technology diffusion, skills, infrastructure, and managerial capability. [25] Can AI improve business efficiency? Yes, but mainly when it is integrated into real workflows and supported by data, management capabilities, and human skills. [26] Why is simplification so important to efficiency?
FAQ
Because unnecessary layers, processes, and systems consume organizational capacity and slow performance, which is why BCG highlights internal complicatedness and Deloitte finds many firms still struggle to simplify work. [16]
What is an operational efficiency strategy?
Does management quality really affect productivity?
An operational efficiency strategy is a business plan for improving how the organization converts time, talent, technology, and capital into customer value and profitable growth through better processes, governance, and resource allocation. [23]
Yes. OECD and World Bank research both show that organizational capital, skills, and business practices are strongly linked to better firm performance and productivity outcomes. [15]
FAQ and closing notes
Why does operational efficiency matter more now than before? It matters more because businesses are navigating a slower long-term productivity environment while facing faster digital change and higher expectations for speed and responsiveness. [1]
What is the biggest mistake companies make in efficiency programs? A common mistake is deploying technology or launching savings targets without redesigning the underlying processes, governance, and accountability model. [12] How should SMEs approach operational efficiency? SMEs should focus on simplifying key workflows, standardizing work, then digitizing the highest-value processes in a phased way,
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since OECD research shows smaller firms often lag in digital transformation despite strong potential benefits. [18] How can leaders measure whether efficiency efforts are working? They should track a balanced set of outcomes such as cycle time, error rates, productivity, rework, customer satisfaction, speed of decision-making, and the amount of capacity freed for higher-value work. [27] What makes efficiency gains sustainable? They become sustainable when companies combine process redesign, management discipline, digital enablement, skills development, and ongoing governance rather than treating efficiency as a one-time initiative. [28] Conclusion The most important change in the economics of efficiency is that efficiency is no longer primarily about reducing inputs. It is about improving the quality of the operating system that turns resources into results. The evidence across OECD, World Bank, IMF, McKinsey, Deloitte, and BCG research points in the same general direction: productivity
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and performance improve when firms simplify work, strengthen management, adopt technology thoughtfully, and design operating models that align decisions, processes, and talent with value creation. In that environment, operational efficiency is not a support function metric. It is a competitive strategy. [29] _____________________________________________________________ [1] [3] [29] Global Productivity: Trends, Drivers, and Policies https://www.worldbank.org/en/research/publication/globalproductivity [2] [9] From Strategy to Performance: How Leaders Can Build an Operating Model That Works | McKinsey & Company https://www.mckinsey.com/featured-insights/mckinsey-live/ webinars/from-strategy-to-performance-how-leaders-can-buildan-operating-model-that-works [4] [11] Digital transformation | OECD https://www.oecd.org/en/topics/digital-transformation.html [5] Fiscal Monitor, April 2024; Chapter 2: EXPANDING FRONTIERS: FISCAL POLICIES FOR INNOVATION AND TECHNOLOGY DIFFUSION; April 10, 2024 https://www.imf.org/-/media/files/publications/fiscal-monitor/2024/ april/english/ch2.pdf
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[6] The World Bank Productivity Project https://www.worldbank.org/en/topic/competitiveness/brief/ the-world-bank-productivity-project [7] Full Report: OECD Compendium of Productivity Indicators 2026 | OECD https://www.oecd.org/en/publications/oecd-compendiumof-productivity-indicators-2026_734a5e68-en/full-report. html [8] [19] [20] [22] [23] [27] What is an operating model and why does it matter? | McKinsey https://www.mckinsey.com/featured-insights/mckinseyexplainers/what-is-an-operating-model [10] [12] Operations Excellence | Deloitte | Strategy and Operations https://www.deloitte.com/global/en/services/consulting/ services/operations-excellence.html [13] [25] Digitalisation and productivity: In search of the holy grail – Firm‑level empirical evidence from EU countries | OECD
https://www.oecd.org/en/publications/digitalisation-andproductivity-in-search-of-the-holy-grail-firm-level-empiricalevidence-from-eu-countries_5080f4b6-en.html [14] [21] [26] Fostering an inclusive digital transformation as AI spreads among firms | OECD https://www.oecd.org/en/publications/fostering-an-inclusive-digitaltransformation-as-ai-spreads-among-firms_5876200c-en.html [15] [28] Management, skills and productivity | OECD https://www.oecd.org/en/publications/management-skills-andproductivity_007f399e-en.html [16] Organizational Strategy Consulting Services | BCG https://www.bcg.com/capabilities/organization-strategy/overview [17] [24] Reclaiming organizational capacity | Deloitte Insights https://www.deloitte.com/us/en/insights/topics/talent/humancapital-trends/2025/reclaiming-organizational-capacity.html [18] The Digital Transformation of SMEs | OECD https://www.oecd.org/en/publications/the-digital-transformation-ofsmes_bdb9256a-en.html
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How Real-Time Payments and Treasury Modernisation Are Reshaping Corporate Finance Corporate finance is moving through a structural shift. What used to be treated as back-office plumbing, such as payment files, bank connectivity, reconciliation, and settlement timing, is now shaping liquidity strategy, working-capital control, customer experience, and even board-level growth planning. The World Bank describes financial infrastructure as the critical system behind everyday payments and credit, and says this infrastructure supports inclusion, stability, cross-border connectivity, and fintech innovation. It also notes that over the last two decades it has supported payment-system reforms in more than 120 countries, including fast payment systems. [2] That backdrop matters because payment speed is no longer a niche feature. The ECB says instant payments make funds available in a payee’s account within ten seconds, while the SEPA Instant Credit Transfer model is designed for continuous availability at all hours and all days of the year. The result is that treasury teams are being pushed toward more dynamic cash forecasting, faster exception handling, and tighter integration between finance, data, and technology functions. [3] At the same time, ISO 20022 is turning payment modernization into a data modernization story. ISO describes ISO 20022 as a common platform and a single standardisation approach for financial messaging, while SWIFT says it provides consistent, rich, and structured data and can support improved analytics, less manual intervention, stronger straight-through processing, and better compliance outcomes. For finance leaders, modernization is no longer just about faster settlement. It is about better information, better controls, and faster decisions. [4] Why Treasury Modernisation Has Moved to the Top of the Agenda Treasury modernization has risen because the underlying payment environment has changed. The World Bank’s financial infrastructure work now explicitly spans retail payment systems, cross-border payments, open banking, and fast payment systems, which shows how treasury priorities increasingly overlap with broader market infrastructure upgrades. In practical terms, that means corporate finance teams are operating in an environment where settlement speed, data quality, and payment interoperability matter more than they did in a batch-led world. [2]
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In Europe, instant payments are no longer theoretical. The ECB says euro instant payments are based on the SEPA Instant Credit Transfer scheme, and that the service is designed to be available 24 hours a day, 365 days a year, with funds available within ten seconds. The European Payments Council adds that the current scheme makes funds available in less than ten seconds and that its rulebook now explains a maximum processing duration of nine seconds within the scheme. For corporate finance teams, that compresses the distance between transaction initiation, cash visibility, and operational decision-making. [3] The same modernization theme is visible in the United States. The Federal Reserve maintains an official FedNow Service page, an About FedNow page, and a live participant directory, underscoring that instant-payment infrastructure is now a live operating environment rather than a future roadmap item. Even without relying on secondary commentary, the existence of these official pages and participant resources shows that U.S. payment modernization has moved into implementation and network growth. [5] How Real-Time Payments Are Changing Liquidity and Cash Visibility The biggest finance impact of faster payments is not simply “speed.” It is visibility. When funds become available within seconds and infrastructure is designed for continuous operating hours, finance teams can rethink intraday liquidity, payment timing, receivables monitoring, refund processes, and supplier disbursement windows. The ECB’s description of instant payments and the EPC’s operational rules point to a world in which payments can move far closer to real time than traditional business-day batch cycles allowed. [3] That changes working-capital management. Instead of relying as heavily on end-of-day position updates, finance teams can move toward nearerreal-time cash awareness, particularly in multi-market environments where settlement timing used to create friction between collections, allocation, and treasury planning. The World Bank’s description of payment systems as part of safe, efficient, and reliable services, along with its support for fast payment systems, reinforces the idea that faster rails are increasingly becoming foundational infrastructure rather than optional overlays. [2] This does not mean every corporate process suddenly becomes instant. Reconciliation, approvals, controls, and ERP dependencies still matter. But real-time rails raise the standard. They make stale cash data more visible, manual repair work more expensive, and fragmented bank connectivity
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harder to justify. In that sense, real-time payments are less a tactical banking upgrade and more a catalyst for finance operating-model redesign. That conclusion follows from the combined direction of the ECB, EPC, World Bank, and FedNow sources, even where each source addresses a different part of the ecosystem. [6] Why ISO 20022 Matters Beyond Compliance Many finance teams first hear about ISO 20022 through bank migration notices or project deadlines. That is too narrow. ISO says the standard provides a common platform for message development and represents a single standardisation approach for financial standards initiatives. SWIFT goes further and says ISO 20022 provides consistent, rich, structured data for financial transactions. Those two points together explain why the standard matters well beyond technical compliance. [7] Structured data changes the quality of finance operations. SWIFT says ISO 20022 enables richer, better structured, and more granular data end to end in payment messages, which can support more transparency, more remittance information, improved analytics, less manual intervention, better customer experience, and enhanced straight-through processing. That means treasury modernization is not just about sending a different message type to the bank. It is about improving matching logic, compliance review, exception management, customer communication, and management reporting. [8] This is also why ISO 20022 affects strategy. Better payment data can shorten reconciliation cycles, improve receivables allocation,
reduce avoidable investigation work, and support more reliable enterprise reporting. SWIFT explicitly links ISO 20022 to higher-quality payments and operational improvement, while ISO positions the standard as a common development platform used across financial business processes. For companies with complex treasury landscapes, the business case is increasingly tied to data architecture as much as to payment modernization itself. [9] What Finance Leaders Should Prioritise Next The most effective treasury-modernization plans are usually sequenced rather than oversized. First, finance leaders should identify where payment timing still relies on batch assumptions that no longer fit the market. The ECB and EPC material makes clear that instant-payment capability is operational reality in Europe, and the FedNow ecosystem signals the same direction in the United States. Finance organizations should therefore map which processes still assume delayed visibility and which could benefit from faster status information or settlement confirmation. [10] Second, companies should treat ISO 20022 as a data-governance project, not just a bank project. ISO and SWIFT both frame the standard in ways that emphasize structure, common language, and richer information. That creates an opportunity to align treasury, ERP, accounts receivable, accounts payable, and compliance teams around cleaner reference data, more reliable remittance handling, and stronger exception workflows. [4] Third, finance leaders should use modernization to reduce operational fragmentation. The World Bank’s focus on safe, efficient systems and cross-border connectivity points to the same underlying priority: resilient, interoperable infrastructure. In corporate terms, that means fewer point integrations, better bank standardization, clearer payment governance, and stronger visibility from initiation to settlement. [2]
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Conclusion
Why does ISO 20022 matter to CFOs and treasurers?
Corporate finance is becoming more immediate, more data-driven, and more infrastructure-aware. Real-time payments are changing the tempo of liquidity management, while ISO 20022 is changing the quality of information available to finance teams. Institutions that treat these shifts as isolated compliance tasks may modernize slowly and capture only a fraction of the value. Institutions that treat them as part of treasury transformation can improve visibility, reduce friction, and build a finance function that is better matched to digital commerce and modern banking infrastructure. [11]
Because it improves the structure and richness of payment data, which can support analytics, automation, compliance accuracy, and reconciliation quality, not just messaging compliance. [14]
FAQ What is treasury modernisation? Treasury modernisation is the upgrade of cash, payments, bank connectivity, reconciliation, and control processes so finance teams can operate with better data, stronger controls, and faster decision-making. ISO 20022 and instant-payment infrastructure are major enablers of that shift. [12] How do real-time payments affect liquidity? They shorten the gap between payment initiation and fund availability, which can improve intraday cash visibility and reduce dependence on delayed settlement assumptions. The ECB states that instant payments make funds available within ten seconds. [13]
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Is instant payment infrastructure only relevant to banks? No. Banks operate the rails, but businesses benefit through faster confirmation, better cash visibility, and improved treasury planning. The ECB and EPC both frame instant payments as services relevant to individuals and businesses across Europe. [15] Does ISO 20022 remove all reconciliation issues? No. It improves the quality and structure of data, which can reduce manual intervention, but companies still need sound internal systems, data governance, and process discipline. [16] What should finance leaders do first? Start with a payment and cash-visibility assessment, then prioritize data quality, bank connectivity, and ISO 20022 readiness across treasury and ERP workflows. That approach aligns with the direction implied by World Bank, ISO, SWIFT, ECB, and FedNow sources. [17] _____________________________________________________________________________
FINANCE
[1] [2] [11] [17] Financial Infrastructure | World Bank Group
Payments Council
https://www.worldbank.org/en/topic/paymentsystemsremittances
https://www.europeanpaymentscouncil.eu/what-we-do/sepa-instantcredit-transfer
[3] [6] [10] [13] [15] [18] [21] What are instant payments? https://www.ecb.europa.eu/paym/integration/retail/instant_ payments/html/index.en.html
[25] Digital and AI | World Bank Group https://www.worldbank.org/en/topic/digitaldevelopment
[4] [7] [12] [20] [22] ISO 20022 | ISO20022
[26] [27] [29] ISO 22301:2019 - Business continuity management systems
https://www.iso20022.org/
https://www.iso.org/standard/75106.html
[5] [24] FedNow Service
[28] [30] ISO 9001:2015 - Quality management systems — Requirements
https://www.frbservices.org/financial-services/fednow
https://www.iso.org/standard/62085.html
[8] [9] [16] ISO 20022 for Financial Institutions | Swift
[31] [32] ISO/IEC 27001:2022 - Information security management systems
https://www.swift.com/standards/iso-20022/iso-20022programme
https://www.iso.org/standard/82875.html
[14] [23] About ISO 20022 | Swift https://www.swift.com/standards/iso-20022
[33] Cybersecurity Framework | NIST https://www.nist.gov/cyberframework
[19] EPC scheme to make real-time payments in SEPA | European
Issue 87 | 35
FINANCE
Why Optionality Is Becoming a Business Superpower Why Optionality Is Becoming a Business Superpower For decades, the corporate finance conversation has largely revolved around familiar metrics. Revenue growth. Profit margins. Cash flow. Return on investment. Capital efficiency. These indicators remain essential. They help investors evaluate businesses, guide management decisions, and provide insight into organizational performance. Yet beneath the numbers lies a financial concept that rarely receives the attention it deserves. Optionality. Unlike profitability or liquidity, optionality does not appear directly on a balance sheet. It is not usually highlighted in quarterly earnings calls. It rarely becomes the subject of headlines. And yet it may be one of the most valuable financial assets a company can possess. Optionality is the ability to act when opportunities arise. It is the flexibility to invest when markets change, expand when demand grows, acquire when competitors hesitate, and adapt when conditions shift unexpectedly. In an increasingly uncertain world, optionality is becoming more important than ever. The companies that consistently outperform over long periods are not always those that predict the future most accurately. More often, they are the organizations that preserve the ability to respond effectively to multiple possible futures. Finance, at its best, is not simply about maximizing returns. It is about creating choices.
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And in today's business environment, choices may be more valuable than certainty. The illusion of certainty Business planning often creates an impression of predictability. Budgets are developed. Forecasts are prepared. Targets are established. Strategies are defined. These processes are necessary. Organizations need direction. However, reality rarely unfolds exactly as planned. Markets shift. Customer behavior changes. Technology evolves. Economic conditions fluctuate. Unexpected events emerge. The challenge is not that forecasts are wrong. The challenge is that the future contains variables that no forecast can fully anticipate. This is where optionality becomes important. Rather than assuming a single future, companies preserve the flexibility to operate effectively across multiple outcomes. The International Monetary Fund regularly highlights uncertainty as a defining feature of modern economic environments, emphasizing the importance of resilience and adaptability in corporate decision-making. https://www.imf.org/en/Publications/WEO The lesson for finance leaders is straightforward. The goal is not to eliminate uncertainty. The goal is to remain capable within it. Cash is more than a financial resource Perhaps the clearest example of optionality is cash. Businesses often view cash through operational lenses. Working capital. Liquidity management. Emergency reserves.
FINANCE
Short-term obligations. All of these considerations matter. Yet cash also represents strategic freedom. A company with strong liquidity possesses choices. It can invest during downturns. It can pursue acquisitions. It can accelerate innovation. It can enter new markets. It can weather temporary disruptions. Organizations with limited financial flexibility often face a different reality. Even attractive opportunities can become difficult to pursue. The value of cash therefore extends beyond its immediate financial function. It creates room for decision-making. This principle becomes particularly important during periods of uncertainty, when opportunities often emerge unexpectedly.
Why flexibility is increasingly valuable Business environments are becoming more dynamic. Technological change continues to accelerate. Consumer expectations evolve rapidly. Competitive landscapes shift quickly. Geopolitical developments influence markets. Supply chains adapt continuously. In such an environment, flexibility becomes economically valuable. A rigid organization may struggle even if its strategy appears sound. A flexible organization can adjust as conditions evolve. According to McKinsey, companies that maintain strategic flexibility and adaptability often outperform peers during periods of economic and industry disruption. https://www.mckinsey.com/capabilities/strategy-andcorporate-finance/our-insights This observation highlights an important shift. Competitive advantage increasingly depends not only on execution but also on the ability to respond. Finance plays a central role in enabling that response.
Issue 87 | 37
FINANCE
The connection between finance and opportunity Finance is often associated with control. Budget discipline. Cost management. Risk reduction. Capital allocation. These functions remain essential. However, finance also enables growth. The most effective financial strategies create capacity rather than simply impose constraints. They allow organizations to pursue opportunities when conditions are favorable. This distinction matters. Cost discipline alone does not create future growth. Strategic flexibility does. The strongest finance leaders understand that protecting resources and deploying resources are equally important responsibilities. A company that preserves optionality can move faster when opportunities appear. A company that exhausts its flexibility may find itself constrained precisely when opportunity arrives. Why optionality rarely appears in financial headlines Financial markets naturally focus on measurable outcomes. Revenue. Profit. Earnings. Valuation. These metrics provide useful insights. Optionality is harder to quantify. Its value often becomes visible only after circumstances change. A strong balance sheet may appear conservative during periods of stability.
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Yet when markets become volatile, that same balance sheet can become a source of competitive advantage. An acquisition opportunity may seem hypothetical until it becomes available. Investment capacity may seem unnecessary until a transformational project emerges. The paradox is that optionality often appears most valuable when it is no longer easy to create. This is why forward-looking organizations invest in flexibility before they need it. The strategic role of patience Optionality is closely connected to patience. Companies frequently face pressure to maximize short-term performance. Investors seek returns. Markets reward growth. Executives pursue ambitious objectives. These pressures can encourage organizations to deploy resources aggressively. Yet preserving optionality sometimes requires restraint. Not every opportunity needs immediate action. Not every available resource must be fully utilized. Not every growth initiative needs acceleration. Patience creates capacity. Capacity creates options. Options create flexibility. This sequence may feel counterintuitive in highly competitive environments. However, some of the most successful organizations understand that strategic patience can generate long-term advantages. The Organisation for Economic Co-operation and Development has repeatedly emphasized the importance of sustainable financial management and long-term value creation in supporting resilient corporate performance. https://www.oecd.org/corporate/
FINANCE
Long-term value often depends on preserving future possibilities. Optionality and innovation Innovation is frequently portrayed as a function of creativity. Creativity certainly matters. Yet finance plays an equally important role. Innovative organizations require resources to experiment. They need capital to explore new ideas. They need flexibility to pursue opportunities that may not generate immediate returns. Optionality supports innovation because it creates room for exploration. Organizations operating under constant financial pressure often struggle to invest in uncertain opportunities. Organizations with greater flexibility can take calculated risks. This dynamic helps explain why strong financial foundations often support innovation more effectively than many observers realize. Innovation is not only about ideas. It is also about having the freedom to act on them. The acquisition advantage Few areas demonstrate the value of optionality more clearly than mergers and acquisitions. Acquisition opportunities rarely arrive according to predictable schedules.
They emerge unexpectedly. Market conditions change. Competitors become available. Valuations fluctuate. Companies with financial flexibility can respond. Those without it often cannot. This does not mean every acquisition is beneficial. It means the ability to evaluate and pursue opportunities matters. Optionality provides that ability. Many successful corporate acquisitions were possible because organizations had preserved sufficient financial flexibility to act when circumstances aligned. The opportunity itself may have been unexpected. The preparedness was not. Talent as a form of optionality Finance discussions often focus on capital. Human capital deserves equal attention. A strong workforce creates organizational flexibility. Talented employees can support expansion, innovation, adaptation, and transformation. Investments in people therefore generate forms of optionality that extend beyond immediate productivity. Organizations with deep capabilities can pursue opportunities that others may find difficult to execute. This principle applies across industries. Financial flexibility matters. Operational flexibility matters. Talent flexibility matters. Together, they create strategic options.
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FINANCE
Technology and optionality Technology is reshaping how organizations think about optionality. Cloud computing allows businesses to scale more efficiently. Data analytics improve decision-making. Digital platforms create access to new markets. Automation enhances operational agility. These developments reduce certain barriers while creating new possibilities. According to the World Economic Forum, technological transformation is increasingly enabling organizations to become more adaptable and responsive to changing market conditions. https://www.weforum.org/reports/future-of-jobs-report-2025 Technology itself is not optionality. It is an enabler of optionality. The real advantage lies in how organizations use technology to expand future choices. Why resilience and optionality are connected Resilience is often described as the ability to withstand disruption. Optionality enhances resilience because it creates alternatives. When conditions change unexpectedly, organizations with multiple paths forward are generally better positioned than those dependent on a single outcome.
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This principle became evident across numerous industries during periods of economic volatility. Companies with strong liquidity, diversified operations, adaptable business models, and flexible workforces often responded more effectively. They were not necessarily immune to challenges. They simply possessed more options. And options matter when circumstances change. The future belongs to adaptable companies Business history is filled with examples of companies that succeeded not because they predicted the future perfectly, but because they adapted effectively. Adaptation requires optionality. Organizations must possess the financial, operational, and strategic flexibility necessary to evolve. This requirement is becoming increasingly important. The pace of change continues to accelerate. Customer expectations evolve. Technology advances. Markets transform. Rigid strategies become harder to sustain. Adaptable organizations gain advantages. Finance increasingly serves as the foundation for that adaptability. Looking beyond quarterly performance Quarterly results will always matter. Investors need transparency.
FINANCE
Management teams need accountability. Performance measurement remains essential. Yet some of the most valuable financial decisions extend beyond immediate reporting periods. Building liquidity. Maintaining balance-sheet strength. Investing in talent. Supporting innovation. Preserving flexibility. These decisions often create value that emerges gradually. Optionality rarely produces instant results. Its benefits become visible when circumstances change. And circumstances always change. The quiet power of having choices The future cannot be predicted with complete confidence. Markets will continue evolving. Technologies will continue advancing. Opportunities will emerge unexpectedly.
Challenges will appear without invitation. The organizations that thrive in such environments are not necessarily those with perfect forecasts. They are often those with the greatest capacity to respond. That capacity comes from optionality. The ability to invest. The ability to adapt. The ability to wait. The ability to move. The ability to choose. In many ways, finance is ultimately the business of creating possibilities. Profitability matters because it creates resources. Liquidity matters because it creates flexibility. Capital matters because it creates opportunity. Behind all of these objectives lies a common principle. The power of having choices. And in an increasingly uncertain business world, that may be the most valuable financial asset of all.
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TECHNOLOGY
How Real-Time Payments and Treasury Modernisation Are Reshaping Corporate Finance
Why Adaptability Is Becoming the Most Valuable Technology Asset For much of modern business history, scale was considered the ultimate competitive advantage. The largest companies often had the strongest market positions, the broadest distribution networks, the deepest financial resources, and the greatest ability to withstand disruption. Size created efficiency, bargaining power, and barriers to entry that smaller competitors struggled to overcome. Technology largely reinforced this reality. Businesses invested heavily in infrastructure, software, data centers, and enterprise systems designed to support growth. The assumption was straightforward: bigger organizations with greater resources would naturally outperform their smaller rivals. Yet a different pattern is beginning to emerge. Across industries, some of the most successful organizations are not necessarily the largest. Instead, they are often the most adaptable. In a world defined by technological acceleration, shifting customer expectations, geopolitical uncertainty, changing regulations, and rapidly evolving markets, adaptability is becoming one of the most valuable business capabilities of all.
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Technology is playing a central role in this shift. The next competitive advantage may not belong to companies that possess the most technology. It may belong to those that can adjust most effectively when circumstances change. The End of Predictable Business Environments There was a time when businesses could build long-term plans with a reasonable degree of certainty. Market dynamics changed gradually. Consumer behavior evolved over years rather than months. Technology adoption followed relatively predictable cycles. That environment has largely disappeared. Today, organizations operate in a world where change arrives faster and from more directions than ever before. A new technology can reshape an industry within months. Consumer preferences can shift rapidly. Supply chains can face unexpected disruptions. Regulatory frameworks can evolve quickly in response to emerging risks. The result is a business landscape where certainty has become increasingly difficult to maintain. Research from the World Economic Forum highlights that adaptability and resilience are becoming essential characteristics for organizations navigating accelerating technological and economic change (https://www.weforum.org).
TECHNOLOGY
In this environment, success depends less on predicting every future development and more on responding effectively when those developments occur. Why Traditional Competitive Advantages Are Becoming Less Durable
This democratization of technology creates opportunities, but it also changes how organizations compete. The question is no longer simply who has access to technology.
Historically, competitive advantages often lasted for decades.
Increasingly, the question is who can use technology most effectively when conditions change.
Companies could build strong positions based on manufacturing scale, physical infrastructure, geographic reach, or proprietary expertise.
As technological advantages become easier to replicate, adaptability becomes harder to copy.
Technology is changing that equation.
Technology Is Becoming More Flexible
Cloud computing has reduced barriers to entry for startups. Artificial intelligence tools are becoming increasingly accessible. Digital platforms allow smaller businesses to reach global markets without building extensive physical networks.
One reason adaptability is gaining importance is that technology itself is becoming more flexible.
Capabilities that were once available only to large enterprises are becoming widely accessible.
Traditional enterprise systems often required extensive customization, lengthy implementation timelines, and significant upfront investment.
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TECHNOLOGY
Modern digital tools increasingly emphasize flexibility.
Technology increasingly supports this capability.
Cloud-based platforms can scale up or down quickly. Software can be updated continuously. Artificial intelligence systems can be adapted to new use cases. Data analytics platforms can support faster decision-making across multiple business functions.
Advanced analytics platforms provide real-time visibility into business performance. Cloud-based collaboration tools enable faster communication. Artificial intelligence helps identify patterns that may not be immediately visible through traditional analysis.
This flexibility changes how organizations approach growth. Instead of building rigid structures designed for a specific future, businesses can create operating models capable of evolving alongside changing circumstances. Technology is no longer just supporting business operations. It is enabling organizational agility. The Hidden Value of Faster Decision-Making One of the most important benefits of adaptability is improved decision-making speed. In many industries, opportunities and risks emerge quickly. Organizations that can identify change early and respond effectively often gain significant advantages over competitors that require lengthy approval processes or extensive restructuring before acting.
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However, the value does not come from technology alone. The value comes from an organization's ability to translate information into action. Many companies possess vast amounts of data. Far fewer can consistently make rapid, informed decisions based on that data. Adaptability is ultimately about action rather than information. Why Customers Are Rewarding Flexible Businesses Customer expectations are evolving alongside technology. Consumers and business customers increasingly expect organizations to respond quickly to changing needs. Products are expected to improve continuously. Services are expected to adapt. Digital experiences are expected to remain relevant and intuitive. Organizations that can evolve alongside their customers often develop stronger relationships and higher levels of trust.
TECHNOLOGY
This dynamic is particularly important in technology-driven markets. The most successful companies increasingly treat customer feedback not as a periodic exercise but as a continuous source of strategic insight. Technology enables that responsiveness by creating closer connections between organizations and the people they serve.
Research from Gartner suggests that organizational resilience increasingly depends on technology architectures that support flexibility, scalability, and rapid adaptation rather than rigid longterm structures (https://www.gartner.com/en/topics/digitaltransformation). This approach recognizes a simple reality. The future cannot be predicted perfectly.
Businesses that listen effectively can adapt more effectively.
Technology strategies therefore need to accommodate uncertainty rather than resist it.
The Rise of Adaptive Technology Strategies
Artificial Intelligence and Organizational Adaptability
For many years, technology strategies focused heavily on long-term planning.
Artificial intelligence is accelerating this shift.
Organizations invested in systems expected to remain largely unchanged for many years. Today, many technology leaders are adopting a different mindset. Rather than attempting to predict every future requirement, they are building technology environments designed to evolve.
Much of the discussion surrounding AI focuses on automation and efficiency gains. Those benefits are significant. However, AI's longer-term impact may be even more profound. Artificial intelligence can help organizations adapt more quickly by improving how they process information, identify emerging patterns, and evaluate potential responses.
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TECHNOLOGY
Businesses can analyze changing customer behavior more rapidly. Supply chain disruptions can be detected earlier. Operational inefficiencies can be identified before they become larger problems.
This connection between technology and resilience is becoming more important as uncertainty becomes a permanent feature of the business environment. Adaptability is no longer simply a growth strategy.
AI does not eliminate uncertainty.
It is also a survival strategy.
What it can do is improve an organization's ability to respond to uncertainty.
The Competitive Advantage That Cannot Be Purchased
That capability may ultimately prove more valuable than automation alone. Why Resilience Is Becoming a Technology Outcome Resilience has traditionally been viewed as a risk-management concept. Today, it is increasingly becoming a technology outcome. Organizations with adaptable digital infrastructures can often recover more quickly from disruptions, whether those disruptions originate from market volatility, cybersecurity incidents, supply chain challenges, or operational failures. According to research from Deloitte, digital maturity is increasingly linked to organizational resilience, enabling businesses to maintain continuity and respond effectively during periods of disruption (https://www.deloitte.com/global/en/our-thinking/insights/topics/ digital-transformation.html).
Many business capabilities can be acquired. Technology can be purchased. Infrastructure can be built. Software can be licensed. Talent can be recruited. Adaptability is different. It emerges from culture, leadership, decision-making processes, and organizational design. Technology can support adaptability, but it cannot create it on its own. This is one reason adaptability may become one of the most durable competitive advantages available to organizations. As access to technology becomes increasingly widespread, the ability to respond effectively to change becomes a more meaningful differentiator. The companies that thrive in the coming decade may not necessarily be those with the largest technology budgets. They may be those that build environments where technology,
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TECHNOLOGY
people, and processes work together to support continuous adaptation. The Future May Belong to the Most Adaptable Business leaders often ask what the next major technology trend will be. Artificial intelligence will continue to evolve. Automation will become more sophisticated. Data analytics will become more powerful. Cloud computing will become more deeply embedded across industries. Yet beneath all of these developments lies a larger trend. Technology is making adaptability more valuable. In a world where change arrives faster than ever, organizations cannot rely solely on scale, historical success, or established market positions. They must be capable of learning, adjusting, and evolving continuously. The future of competitive advantage may not depend on who builds the biggest systems. It may depend on who builds the most adaptable organizations. And increasingly, technology is becoming the foundation that makes that adaptability possible.
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INDUSTRIES
How Real-Time Payments and Treasury Modernisation Are Reshaping Corporate Finance
Industrial innovation has historically progressed through successive technological revolutions. Recent decades have seen widespread adoption of: • Industrial automation • Robotics • Cloud computing • Artificial intelligence • Digital twins • Industrial IoT • Advanced analytics While these technologies remain central to industrial competitiveness, organizations increasingly recognize that long-term success depends not only on automation but also on adaptability, sustainability, and human collaboration. Industry 5.0 reflects this broader vision. Understanding Industry 5.0 Industry 5.0 builds upon the digital foundations established by Industry 4.0 while expanding industrial priorities. Rather than focusing exclusively on operational efficiency, Industry 5.0 emphasizes three interconnected objectives:
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• Human-centricity • Sustainability • Resilience According to the European Commission, Industry 5.0 complements Industry 4.0 by ensuring that research and innovation contribute to industrial systems that benefit workers, society, and the environment alongside economic performance. (Research and innovation) Human-Centered Innovation One of the defining characteristics of Industry 5.0 is the changing relationship between people and technology. Instead of replacing workers, intelligent systems increasingly support human expertise. Examples include: • Collaborative robots (cobots) • AI-assisted decision support • Digital work instructions • Augmented reality guidance • Intelligent safety monitoring Technology increasingly augments human capabilities while allowing employees to focus on higher-value activities.
INDUSTRIES
Artificial Intelligence as an Industrial Enabler
Digital Twins Improve Industrial Visibility
Artificial intelligence has become a foundational technology across industrial operations.
Digital twins create virtual representations of physical assets. Industrial organizations increasingly use digital twins for:
Current applications include: Predictive Maintenance AI identifies equipment issues before failures occur. Quality Inspection Computer vision systems improve manufacturing consistency. Production Optimization Machine learning continuously adjusts production parameters. Demand Forecasting AI improves production planning using historical and realtime information. Recent academic reviews note that trustworthy AI is becoming central to Industry 5.0 by supporting sustainable, resilient, and human-centric industrial operations. (arXiv)
• Equipment monitoring • Factory simulation • Production optimization • Maintenance planning • Energy management These virtual environments allow organizations to evaluate operational changes before implementing them in physical facilities. Sustainability Is Becoming a Core Objective Environmental performance has become an important component of industrial innovation. Organizations increasingly invest in: • Energy-efficient production • Circular manufacturing • Waste reduction • Resource optimization • Carbon monitoring The European Commission identifies sustainability as one of the three foundational pillars of Industry 5.0 alongside resilience and humancentricity. (Research and innovation)
Issue 87 | 49
INDUSTRIES
Building More Resilient Industries
Smart Factories Continue to Evolve
Recent global disruptions have highlighted the importance of resilient industrial systems.
Modern smart factories increasingly combine:
Manufacturers increasingly strengthen resilience through: • Supply chain diversification • Real-time monitoring • Predictive analytics • Flexible manufacturing • Cloud-based industrial systems Industry 5.0 encourages organizations to design production systems capable of adapting more effectively to changing market conditions. Workforce Development Becomes Strategic As industrial technologies become more sophisticated, workforce capabilities become increasingly valuable. Organizations continue investing in: • Digital skills • AI literacy • Robotics training • Data analytics • Continuous learning • Human-machine collaboration The Industry 5.0 framework highlights workforce development as an important element of industrial competitiveness. (Research and innovation)
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• Industrial IoT • Artificial intelligence • Cloud computing • Robotics • Edge computing • Advanced sensors Rather than maximizing automation alone, next-generation smart factories increasingly seek to improve flexibility, customization, worker experience, and sustainability. A 2025 systematic review of smart factory production highlights that human-centricity is emerging as one of the defining characteristics of Industry 5.0 manufacturing environments. (arXiv) Cybersecurity Remains Essential Greater industrial connectivity increases the importance of cybersecurity. Organizations continue strengthening: • Industrial network protection • Identity management • Operational technology (OT) security • Secure remote access • Continuous monitoring Reliable cybersecurity supports operational continuity while protecting increasingly connected production environments.
INDUSTRIES
Challenges Facing Industry 5.0
Sustainable Industrial Design
Despite significant progress, several implementation challenges remain.
Manufacturers are expected to continue integrating circular economy principles and resource-efficient production.
These include:
Digital Workforce Development
• Legacy industrial infrastructure • Skills shortages • Technology integration • Cybersecurity risks • Investment requirements • Organizational change management Addressing these challenges requires coordinated investment in both technology and workforce development. Emerging Trends Several developments are expected to shape Industry 5.0 over the coming years. Greater Human-Machine Collaboration Collaborative robotics and AI decision-support systems are expected to become more widely deployed. Intelligent Manufacturing Factories will increasingly optimize production using realtime analytics and adaptive automation.
Organizations will likely invest further in digital upskilling and continuous workforce education. Trustworthy Artificial Intelligence Industrial AI adoption is expected to place increasing emphasis on transparency, governance, explainability, and responsible deployment. (arXiv) Conclusion Industry 5.0 represents an evolution in industrial innovation that extends beyond automation and digital transformation. By combining advanced technologies with human expertise, sustainability objectives, and resilient operational design, organizations are redefining what successful industrial transformation looks like. Artificial intelligence, digital twins, collaborative robotics, predictive analytics, and intelligent manufacturing systems will continue driving productivity. However, long-term competitiveness is increasingly expected to depend on balancing technological capability with workforce development, responsible innovation, and environmental stewardship. As industries continue modernizing, Industry 5.0 offers a framework for creating manufacturing systems that are not only smarter, but also more adaptable, sustainable, and centered on human value.
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