Strategic Treasury

Blending Heritage and Innovation Much has changed unrecognisably since the global financial crisis struck. But there are certain fundamentals have not: the need for good customer service, customer satisfaction, and large corporations’ requirement for innovative, tailor-made solutions.

Blending Heritage and Innovation

by Roemer Paquay, Head, Cash & Liquidity Management Sales, ABN AMRO

Almost exactly five years have elapsed since the global financial crisis struck, during which time cash management has changed unrecognisably. Or has it? Over the past three years since the creation of the new ABN AMRO, we have had the privilege of building a new cash and liquidity management business and international network to meet the needs of our multinational customer base. Some things, the regulatory environment and the new SEPA landscape for example, have changed immeasurably. Some things have not: the need for good customer service, a constant focus on driving ever-higher levels of customer satisfaction, and large corporations’ requirement for innovative, tailor-made solutions.

Many of the products and solutions that treasurers need to manage their day-to-day business appear to be largely commoditised, particularly in Europe as SEPA payment instruments replace legacy domestic instruments. A bank has to deliver reliable, secure transaction processing, but beyond this, it needs to understand the concerns, frustrations and aspirations of its customers and deliver solutions and services that make day-to-day operations easier and support the company’s strategic vision. This is fundamental to achieving customer satisfaction. As a result of our constant emphasis on raising standards, ABN AMRO has been independently ranked as being a top bank in Europe for customer satisfaction amongst large corporates.

Maintaining customer satisfaction involves maintaining trusted relationships during good and bad times, especially in times of change. SEPA migration is a major undertaking for every company and we have been proactive and pragmatic in enabling customers to achieve SEPA compliance and leverage the benefits of a harmonised payments environment in Europe. For example, ABN AMRO was the first bank in the Netherlands to support large corporates with substantial SEPA Direct Debit (SDD) volumes.

Many companies have reviewed their banking partners ahead of SEPA migration to rationalise banks and simplify cash management structures. During this review process, companies of all sizes have recognised the value of strong, local banking relationships combined with the international reach to meet their cross-border cash management needs. Corporations continue to appoint ABN AMRO for a variety of reasons, but our ability to deliver tailor-made solutions to their cash management and trade finance challenges is a major factor. From trusted escrow to ISO-certified electronic banking systems to advanced cross-currency cash pooling, we build on the pioneering culture that has been an integral part of our history for the past 300 years to find creative solutions to customer challenges.

Our service culture is not simply about making our customers feel good, it can be demonstrated in very tangible ways. We offer bespoke service level agreements (SLAs) with targets and key performance indicators that are specifically matched to customer objectives, supported with regular performance reviews so we can measure progress and adapt our solutions and services as each customer’s business evolves.

One example of how we continue to anticipate and respond to changing customer needs is the development of our international network. While most banks have to deal with legacy challenges of acquired overseas businesses, which can create fragmentation and inconsistency in banks’ international networks, at ABN AMRO customers benefit from a network that has been developed from scratch based on a single platform, customer service model and solutions portfolio. Our network now covers the key European markets, with logistics and finance centres in major global markets such as the US, Brazil, the Nordics, Russia, Singapore and Hong Kong. Instead of trying to expand into every country, we focus on the markets and solutions that are most important for our customers. As an example, we launched offshore RMB solutions in Hong Kong last year; another is the development of a brand new international cash pool engine, which we completed this year. We continue to invest in our ability to deliver and to support tailor made cross border liquidity management frameworks.

The next few years will continue to bring challenges and opportunities, some of which can be anticipated and some which cannot. Regulations such as Basel III will drive closer relationships between banks and corporates with a greater focus on the entire relationship rather than individual solutions, and constraints on capital will continue to focus treasurers’ attention on working capital optimisation. Unlocking cash in the financial supply chain will be a growing priority; for example, we anticipate that e-invoicing in combination with reverse factoring solutions will develop rapidly. The post-SEPA landscape will also continue to drive change, in terms of market participants and the opportunities for greater harmonisation, but also value-added services that are likely to emerge. Our experiences and customer feedback show that while the market and regulatory environment continue to change significantly, the fundamentals of customer satisfaction do not.

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