Blockchain Advocates Forget to Involve Finance Execs. That's a Mistake.

Mar 15, 2016
Jeff Glenzer, Vice President and Chief Operating Officer, AFP

To the list of certainties in life—namely, death and taxes—you can now add a third: blockchain conferences.

Seems like every week I get an email, or read about, a new confab featuring a who’s who of movers and shakers in the blockchain and distributed ledger technology field. Founders. Financiers. Futurists. Consultants. Evangelists. Academics. Attorneys. Regulators. Politicians.

You know who’s not on that list? 

Finance executives. 

As in, the treasurers and chief financial officers who hold the corporate wallet and manage corporate risk. 

They are the ones who decide whether the organization will purchase or use applications built on an emerging technology like blockchain and DLT. And since so many use cases of this new technology touch treasury and finance—payments, derivatives settlement, syndicated lending, repurchase agreements, and more—you can be sure they will scrutinize blockchain very carefully. 

When you are the individual who decides when to use solutions that affect corporate cash flow or expose your organization to new risks, you take that responsibility seriously. I’ve seen many solutions developed and presented to the corporate treasury community that had lots of fascinating whistles and bells—but they were often solutions looking for a problem or used technology that was not understood by the end user. Finance executives are a cautious lot, and generally won’t buy the shiny new toy just to show they are using the latest technology.

But don’t take my word for it. Here’s what a few finance executives who volunteer with my organization recently had to say about blockchain:

“You really have to figure out how you can apply it to delivering lower costs, supporting market expansion, improving operational efficiencies or entering new markets.” 

“You can’t just jump and adopt any technology. You have to dollar-vote it in. For us, PayPal was dollar-voted in, bitcoin was dollar-voted out.”

“From a corporate practitioner standpoint, I am nowhere near interested in being on the cutting edge of fintech. I will wait until it’s ubiquitous before venturing down that path. We make a lot of payments, but payments isn’t our business.”

“If we can remove manual and repetitive tasks and put them into a technology-based solution—that should be the goal.”

Understand, I am a blockchain believer. And I know finance executives are coming around as well. One told me, “If blockchain is going to be the technology of the future, we’d better start getting educated on how it works—whether it’s treasury or finance or FP&A.” 

So treasurers and CFOs understand that blockchain is not a fad, and that it will impact their job at some point. It’s all well and good for the blockchain community to meet up, network and to develop proofs of concepts using blockchain. In order for blockchain startups to find receptive end users, however, they’ll need to talk to corporate treasurers and CFOs and listen to their pain points—and then leverage blockchain to develop elixirs for those pains.