It is the ambition of Seng Ti Goh, General Manager of Treasury & Accounting at Isuzu Motors, to build a world-class treasury function. Starting with a blank canvas, he has already made much progress towards reaching this objective. He now has his eye on the future – and more specifically, on how emerging technology can help him to achieve his goal.
Seng Ti Goh
General Manager of Treasury & Accounting
Founded in 1916, Isuzu Motors has the longest history of any Japanese vehicle manufacturer. By following its mantra of “creation without compromise” the company has become a world leader in the commercial vehicles space with a presence in over 100 countries around the world.
Since the dawn of the 20th century, Isuzu Motors has had a crucial role in Japanese history. This was especially true during the post-war years when Isuzu played its part in the reconstruction of the country by providing trucks to carry all kinds of building materials, products and foodstuffs. Since then, Isuzu has branched out from its Japanese roots and to develop into a truly international brand.
As Isuzu’s very first treasury professional, Seng Ti has a lot of responsibility on his shoulders to ensure the financial future of this iconic Japanese brand. The chief architect of the company’s treasury and finance function, Seng Ti strives to build a department that can support the business as it pushes ahead with its international ambitions. This has involved putting in place a host of new solutions, changing institutionalised ways of working and educating the business on the objectives of treasury.
His success in building up the treasury has seen Seng Ti’s responsibilities expand. The company increasingly recognises the value that the department adds. But never one to rest on his laurels, Seng Ti is now considering what he needs to do next to achieve this ambition of creating a truly world-class treasury and finance function within Isuzu.
Seng Ti is unfazed by the tremendous responsibility that he holds in his role at Isuzu. In fact, he says he will not have it any other way. “I joined the company at a fascinating juncture in its history,” he says. “Isuzu has always been a leading Japanese brand and Japan is where much of the Group’s revenue came from. However, the international expansion that has taken place over the past decade has changed this completely and now two-thirds of revenue comes from outside of Japan.”
It is this international expansion, and the plethora of risks that it has created spanning FX, interest rates and more, that spurred Isuzu to hire a treasury professional. When approached about joining the company and filling the role, Seng Ti did not need long to decide. “Being given a blank canvas to work with – and a chance to make my mark on a company with the heritage of Isuzu – was a fantastic opportunity, and one that few would turn down.”
In his first few weeks with the company, Seng Ti admits that he spent most of this time understanding how the organisation functioned and the challenges it faced, as well as building relationships with key stakeholders. “I had a good idea of what I wanted to do with the treasury department, but as the new guy in the company I couldn’t come in, be overbearing and make sweeping changes,” he says. “It would be naïve to push for changes without speaking to people and learning first-hand about the organisation.”
For Seng Ti, there were two important reasons for doing this. “Firstly, I wanted to build a rapport with key stakeholders and staff so that when I implemented changes that would impact how they worked they would understand why I was doing it and buy into the project,” he says. “Secondly, any changes that are made will create a chain reaction that can sometimes lead to unexpected events. Given that I was new and didn’t have an intimate understanding of the global business, I wanted to learn about it from people that had been there for a long time to better predict that chain reaction and mitigate the risks arising from any unexpected events.”
This strategy paid dividends when Seng Ti was implementing one of the treasury department’s flagship projects: a multilateral, multi-currency netting solution. “This was a project that had a big impact on the business units and how they operated,” he explains. “Yet, because I had taken the time to speak to the people in the business units and build a rapport, the level of resistance was much lower than I had expected. As a result, I was able to get the project over the finish line, improving multiple processes and reducing costs significantly. It was a big win for treasury and showcased the value that we can add.”
Journey to treasury
Seng Ti attributes much of his success in his first few years at Isuzu to his experiences and the lessons that he learnt early in his career. After graduating from the National University of Singapore with a degree in Statistics and Economics, Seng Ti joined the Japanese banking giant SMBC as a Dealer on the money markets desk. “In this role, I managed the bank’s balance sheet, quoted interest rates, managed the funding gap risks and dabbled in prop trading – before prop trading became a dirty word,” he says. “It was a fast-paced role and a steep learning curve, but it gave me a great grounding in finance and how financial markets work.”
After spending two and a half years at the bank, Seng Ti moved on to work for one of Asia’s largest hedge funds, Asia Genesis Asset Management. In his role as a Trading Strategist, Seng Ti helped to manage the fund and traded T-bond & JGB futures, stock indices futures and FX. “I was only there for a year, but I loved it,” he says. “The only problem was that it was a very intense role and required nothing less than full commitment and long hours were necessary. As I traded both Japanese and US markets, it was common for me to watch US markets until 2am at home and continue trading the Japanese markets at 8am the next morning. I had a young family at that time and it was difficult for me to manage my work commitments and family time optimally.”
Having reached this crossroads in his life, Seng Ti had a decision to make on what to do next. And with experience on both the buy and sell side of financial markets, there were many options open. “I decided to work in corporate treasury as I felt it reflected my skillset and with the improved work-life balance, I could fulfil one of my life goals to do a part-time MBA,” he says. “While it may not be as fast paced as working in a bank or hedge fund, corporate treasury enables you to have a valuable impact on the business you work for. I have no regrets and haven’t looked back.”
Seng Ti cut his teeth in corporate treasury working at the SKF Treasury Centre. He later joined Maersk Treasury before taking up his role with Isuzu Motors in 2015. With no prior corporate treasury experience before these roles, Seng Ti admits that he has done a lot of learning on the job, especially in his time at SKF and Maersk. However, he believes that entering corporate treasury through a less traditional path has enabled him to bring a different perspective to the profession and view problems differently.
From pupil to teacher
Today, Seng Ti is active in the corporate treasury scene; he serves as an Executive Committee member of the Association of Corporate Treasurers (Singapore) and speaks in seminars and conferences. And he is keen to share his knowledge with those within Isuzu and has been organising a yearly finance, treasury and accounting conference, that will see senior executives from across the organisation fly into Singapore to learn more about what is happening across the financial industry and how this is impacting Isuzu over the two-day event.
“This event is unprecedented,” says Seng Ti. “In 2015, when I first broached the idea with my bosses they were apprehensive – but after I explained how it would all work they became excited and gave me the go ahead. Now it has become an annual event that many across the Group look forward to.”
The aim of the conference is to ensure that all senior executives within the organisation are cognisant of the basic purpose of the treasury function, have a common platform where they can openly discuss their issues with other senior finance colleagues and solicit advice from the treasury at the same time. Seng Ti and his team have invited several external experts from Isuzu’s banking group and advisory firms to present and speak on the key topics of the day. “It is about breaking down walls and building bridges so that treasury can receive greater support for new initiatives,” he adds.
A changing world
One topic that Seng Ti guarantees will be on the agenda at the conference is the changing geopolitical landscape. “Geopolitical changes manifest themselves in regulatory instability and market volatility, both of which have created a few issues for treasury in recent months,” says Seng Ti.
On the point of market instability, Seng Ti expands by saying that over the past 18 months he has had to deal with several sudden market shifts across the region. Whilst problematic, Seng Ti has worked hard to ensure that these events do not negatively impact Isuzu, using a range of hedging techniques.
In fact, in a roundabout way, the market volatility brought on by shifting geopolitical dynamics provides treasury with an opportunity to demonstrate its value to the organisation. “Before there was a treasury in place, the commercial teams made their own call about what was right to do when FX rates shifted, for example,” says Seng Ti. “But now we are there to advise and help them make more informed decisions when they negotiate contracts with suppliers to mitigate FX risk and highlight other potential risks.”
“Technology is having a significant impact on how treasury departments operate and how they add value to the organisation – this is clear.”
Changing regulatory regimes across the region also pose a challenge, but Seng Ti pragmatically regards these as “par for the course when operating in Asia”. In his view, it is staying abreast of the big multinational regulatory reforms that are more challenging. “We must constantly stay informed about regulations such as MiFID II and work to ensure we are compliant in order to continue our basic risk management role like entering into FX hedging contacts with European banks,” he explains. “If we don’t, there will be big implications down the line.”
Be digital or be left behind
Away from geopolitical instability and market volatility, another big topic on Seng Ti’s agenda is the changing technological landscape. As a keen observer of what is happening right across finance and banking industry, Seng Ti is fully aware of the transformational impact that technology is having on all businesses. The big question for him is: what does this mean for treasury?
“Technology is having a significant impact on how treasury departments operate and how they add value to the organisation – this is clear,” says Seng Ti. “There is already a big gap forming between those that have some form of technology, like a TMS, and those that don’t. If those departments without technology do not begin to adopt it soon, the gap will widen and they will be left behind. This will result in them not being able to add value to their organisations and potentially losing their seat at the table – this is a real danger for many treasury teams.”
As a treasury professional looking to leverage technology more effectively, Seng Ti is fully aware of the difficulties that some treasury teams have in getting a budget for these projects. “Many organisations tend to take a short-term outlook when deciding what to invest in,” he explains. “So, when you talk about installing a TMS you get asked questions like ‘what is the cost, what are the changes it will involve and how much disruption will it cause?’” Whilst Seng Ti believes these are valid questions, “it can make TMS a hard sell, because the costs are substantial and the benefits are abstract and not realised immediately”.
“Blockchain will transform how companies in a lot of industries will behave.”
Despite the issues that some treasury departments have in getting the budget to invest in new technology, Seng Ti believes that it is just a matter of time before technology is ubiquitous across every part of a business. One transformative technology that he has his eye on is blockchain technology. “Blockchain will transform how companies in a lot of industries will behave,” he says. “For example, if it can be used to manage the supply chain from end-to-end then it will fundamentally change how these processes work and can dramatically reduce costs. The banks are clearly experimenting in this space and I am patiently waiting for them to bring commercialised products to the table.”
Seng Ti is also currently pondering the impact that technology will have on humans in the workplace. And having already seen humans replaced by robo-advisors in the banks, he has concluded that gradually more jobs will be lost to machines. “What this means for the future of treasury departments, I do not know,” he says. “It is a skilled role, but it is plausible that robots could, in time, perform skilled roles as well as – or perhaps better than – humans.”
Despite the technological revolution and the rise of the machines, Seng Ti jokes that he expects to have a job for the foreseeable future. And it is his ambition to continue the work he has done at Isuzu and lead the treasury setup into a truly world-class function. “We have come a long way in a few years and the department is already adding a lot of value to the organisation,” he says. “However, I know there is a lot more value that we can add. I will continue to strive towards building a best in class treasury function that can support Isuzu Group for the next 100 years of its history.”