WPP has treasury operations on three continents and each center has its own individual needs. The company needed to devise a request for proposals (RFP) for implementing a new treasury management system (TMS) and Swift-based bank communication that would serve the diverse needs of each regional office. Zanders worked on this project from an early stage, helping WPP to write a cohesive RFP and providing objective advice at the selection stage.

The biggest marketing company in the world, with 2,400 offices and operations in 107 countries, WPP has four main treasury centers. With headquarters in London and three regional treasury centers in Brussels, New York, and Hong Kong, the requirements of each hub differed considerably. The process of writing an RFP that would meet, combine, and harmonize the needs across the London, Brussels, and New York treasury offices was the first conundrum.

An RFP to meet all TMS requirements

Zanders was involved in the RFP from the outset, having come through a consultant selection process. Paul Delaney, director of treasury at WPP’s London headquarters, says: “We felt Zanders were best qualified to help us in the project, and they had good feedback from other companies with similar requirements.”

It was Zanders’ task to become very familiar with the organization, processes, and system requirements of each of WPP’s three treasury centers, and they did this by visiting each office and spending three days assessing their needs. Three Zanders consultants were working on the project throughout: Thomas Pels, David Kelin, and Laurens Tijdhof, all of whom worked with the treasury staff at WPP to write up an RFP that would set the company on its way to selecting a new TMS. “It was a joint effort between WPP and ourselves to make sure that we went into great detail and got all the questions we needed for the RFP,” explains Thomas Pels, of the Zanders’ Brussels office.

We felt it was important to bring in an independent view partly because, as a treasury department, we aren’t necessarily up-to-date with the changes in TMSs and aren’t best-placed to make an objective assessment of what best suits our needs.

Paul Delaney, Director of Treasury at WPP.

Paul Delaney believes that bringing Zanders on board was the right way to manage the project. “We felt it was important to bring in an independent view partly because, as a treasury department, we aren’t necessarily up-to-date with the changes in TMSs and aren’t best-placed to make an objective assessment of what best suits our needs,” he says. This is an opinion echoed in each of WPP’s treasury offices. David Hughes, WPP’s director of treasury operations in New York, points out that Zanders facilitated the RFP process between the three offices: “That is something I think we would have had a really hard time doing if we didn’t have Zanders – they were able to take an objective point of view.”

Three treasury centers – one global TMS

The most important requirement for the TMS from the London headquarters’ point of view was to have an updated reporting function, says Felicity Ronayne, UK treasury operations manager in WPP’s London office. “We wanted a system we could all use that was up-to-date, with really good report-writing features and a cash position worksheet that we could access across all regions.”

The heavy reliance on checks, zero-balancing, and WPP’s large number of US operating companies meant that the needs of the US office varied significantly from the offices in Europe. David Hughes notes: “We sometimes have over USD 100 million checks clearing in the morning, so one of our needs was for controlled check disbursement funding notification to be included in the workstation cash positioning. We also need to maintain a lot of inter-company schedules on the treasury workstation and another big difference is our reliance on zero-balancing from the operating company accounts to the main WPP account – in the US it is the basis of everything we do.”

The requirements for the Belgium office were slightly different. Veronique Freymann, European treasury manager at WPP’s Brussels office, notes: “The Belgium team manages more than 2000 accounts of the 750 entities in more than 15 countries. Furthermore, we manage the cash pools (zero-balancing, notional, and multi-currency), the group account structure, inter-company loans, and the group’s guarantees. For this, the possibility to have cash forecast information delivered via the web was one of the major requirements.”

Zanders managed to combine all the different regional requirements into one global RFP document. The RFP resulted in three potential TMS providers, but WPP finally chose IT2. The system is being implemented gradually across the headquarters and two regional centers. It is near completion in New York and Brussels, while implementation in the London office will begin with static data in Q4 2012.

Veronique Freymann says: “The implementation of IT2 is gradual – so we have started to upload data from bank statements, which enables us to use some tools already. We will start with the inter-company loans and it will be a step-by-step process.”

The TMS in the New York office will be fully functional by the first quarter of 2012, although they will be testing it and running parallel with it before then.

Choosing a Swift Service Bureau (SSB) provider

As well as playing an active part in the TMS selection, WPP’s Brussels office also led the process in selecting an SSB provider. David Kelin, director at Zanders’ London office, points out that the TMS selection and the choice of SSB provider were complementary projects. “When we were looking at the TMS, we also assessed WPP’s banking relationships and communications – we established early on that an SSB would be necessary and that Alliance Lite would not be sufficient for WPP’s needs.”

WPP eventually chose Swiss provider BBP to provide their Swift bank communication. The selection of the SSB was completed in August but it has not gone live yet. WPP’s Brussels office is currently transmitting data across to the new SSB system, and it will become effective before the end of 2011.

As with the TMS selection process, Zanders was instrumental in helping WPP to understand their needs for Swift and then choose the right product. “We are the end users, so we know what we want, but we don’t know what advantages one solution offers compared to others,” says Thierry Lenders, European treasury manager at WPP’s Brussels office.

It is expected that the SSB will bring significant benefits for the Brussels office. Veronique Freymann notes: “SwiftNet gives a single channel of communication between us and the banks, so it will be a lot easier for us.” For now, WPP is reserving judgment on whether the SSB will be needed in its other treasury centers. Paul Delaney says: “It was evident that we needed the SSB in Brussels, but it is not yet clear if we will get the same benefits from it in New York and London. We are watching what happens in Brussels closely and we’ll make a proper assessment once it’s fully installed there.”

Bringing the project to a happy conclusion

This has been a long and complex project. What began as a challenging RFP in 2010 then became the selection and implementation of a TMS and an SSB. The project is ongoing, and several months remain before both IT2 and the SSB are fully functional.

We were very impressed with the quality of the people at Zanders and the depth of their knowledge. Most of all, we really appreciate the fact that the same three Zanders consultants have seen the project through from beginning to end.

David Hughes, Director of Treasury Operations.

For more information on selecting a Treasury Management System or on the process of choosing a Swift Service Bureau provider, contact us.

When Coca-Cola Hellenic (CCH), one of the biggest bottlers and sellers of Coca-Cola products in the world, implemented SAP in 2008, the treasury team expected great improvements in cash management and financial communication across the 28 countries in which the group operates. The reality was somewhat different, with the implemented version of SAP not interacting in harmony with CCH’s enterprise resource planning (ERP) system, called Wave 1. It was at that point that the newly appointed treasurer, Bart Jansen, decided to re-design and improve the SAP implementation – with help from Zanders.

When Bart Jansen joined CCH treasury in 2008, he might have been forgiven for thinking that he had joined at the perfect time – the company had just gone live with SAP Treasury. So with the latest technology already in place, surely Jansen would be able to focus on the bigger treasury issues?

He soon found that the treasury team in Athens was far from happy with how SAP was running. Treasury operated a stand-alone ERP5 installation that had to integrate with three SAP kernels at different versions of SAP. There was repetition of functions and lack of integration. Jansen explains that there were high levels of dissatisfaction with the functionality of the system among CCH’s users: “I started the new job as treasurer in the midst of the financial crisis with a team that was quite frustrated with their tools and also understaffed. I needed to do something drastic about this, so I called Judith van Paassen at Zanders.”

Jansen’s relationship with Zanders goes back a long way. As a Dutch national, he was previously treasurer at Dutch utility group Nuon, where he carried out a successful system implementation with Zanders. “After that experience, I knew that Zanders were knowledgeable about SAP, so when I moved to CCH in Athens, it was a natural step to call them,” he says. CCH sent out a request for proposal (RFP) and Zanders won the selection process.

Once Zanders had become involved in the project, things started to move quickly. Jansen says: “Bas Rebel and Bart Mol came over and worked with us in early 2009 and helped to identify 70 ‘gaps’, or weaknesses, in our process. While we identified some ‘quick wins’, we also realized that a lot more effort was required to address more structural issues.”

Integrating treasury with Wave 2

The aim of the SAP implementation was to upgrade the system to fit in more coherently with the Wave 2/ECC6 template. Every country treasury unit had its own banking partner and was communicating in its own way, so this also had to be upgraded to Wave 2. Jansen explains how the project team worked to resolve these issues: “With help from Zanders we started to develop a business case that would solve our immediate and long-term structural issues related to the tools we use and the way we interact with our 28 countries. We now have a more integrated solution – particularly for FX and cash management data – that complies with the latest standards and strengthens communications.”

The business case was approved for the implementation project in November 2009 and work started on it in January 2010. As with any major implementation involving many different disciplines, it was not without some challenges. Jansen says: “One of the difficulties was the tight corporate deadlines regarding the Wave 2 roll-out. We had to comply with the Wave 2 deadlines imposed upon us by our own company, so we had to get the project started quickly.”

Communication is key

One of the challenges of working with an international team of consultants, according to Jansen, was getting people together in the same place: “The complexity of the system and the solution meant we had to involve several experts from different fields. Ultimately it was a matter of finding the right experts and getting them together, for example getting the people from Zanders together with our IT people. It wasn’t easy as they were not always in the same country, but we still managed to communicate and address the issues.”

Zanders partner Laura Koekkoek adds: “We’re very pleased with the professional way the project has been run – in particular the testing phase was taken very seriously. We had a lot of people working together on this, so communication has been crucial.”

Complex challenge

The best advice is always to stay as close to the standard version of SAP. Although this isn’t always possible, it helps to keep the complexity at a manageable level. We absolutely benefited from Zanders’ expertise and knowledge of SAP in this regard.

Bart Jansen, Treasurer at CCH

With a complex system, designing the security and access rights has also been a time-consuming operation, as Jansen explains: “We spent a lot of time designing the authorization system, bearing in mind the segregation of duties within the company, and that has been really challenging on an integrated platform. We worked on this with internal auditors, and it was one of the most important aspects before we went live.”

A pleasant working environment

So despite the pressures and complexity of this SAP implementation, is CCH happy with the results? For Bart Jansen, the most important gauge of the project’s success was whether his treasury team in Athens was happy with the tools and system. “It has been a great success from that point of view,” he says. “They were previously spending a lot of time on administration and spreadsheets, whereas now they can spend time on more meaningful tasks. We have been able to streamline processes and thereby reduce time spent on certain tasks by 30–50%, while the controls have significantly improved. So the team has a much more manageable workload and therefore a more pleasant working environment.”

CCH’s treasury is now in the process of rolling out SwiftNet and the SAP Bank Communication Management module to the country units, replacing the local electronic banking system functionality. This year they will begin work on an in-house bank, and once that is completed, they will set up a payments factory as part of the SAP system. Jansen adds: “We are now in the process of fully automating foreign currency accounting. We’re making a significant investment into the Wave2 platform. So we are already seeing significant benefits and hope to see more in the future.”