Published: September 01, 2010
In the last edition of TMI, Peter van Rood and Gerrit Gramser of AkzoNobel described their process for defining their cash management objectives, appointing regional banking partners, and implementing the first stages of their payments and cash management project. ING was delighted to be appointed as AkzoNobel’s European cash management bank and is proud to be supporting AkzoNobel in its transformation project. In this article, we look at the AkzoNobel cash management project in more detail, illustrating how we work with our multinational clients with implementation needs in multiple countries.
ING received AkzoNobel’s request for proposal (RFP) for European cash management in December 2008 and we submitted our response in March 2009. Over the next few weeks, we provided clarification on our products and services, and provided details of reference customers. As a consequence of this process, we were included in a shortlist with four other banks, and presented our solution as part of a ‘beauty parade’ in June 2009. The shortlist was reduced further and we conducted a series of workshops with AkzoNobel addressing specific aspects of our solution. ING was then appointed as AkzoNobel’s European cash management bank in June/July 2009.
For ING, fulfilling a client’s needs and expectations starts at the point of first engagement. Therefore, on receiving AkzoNobel’s RFP, we put together a deal team comprising professionals from sales, relationship management, implementation and project management, supported by senior management, who would be able to manage AkzoNobel’s project from bid to implementation. This proved a highly successful strategy, not only to ensure that AkzoNobel received all the information they needed to support their initial decision, but to facilitate a rapid implementation. The cash management project had to be aligned with other elements of the treasury transformation project, specifically the in-house bank and SAP implementation, so we had to start immediately in order to facilitate an April 2010 live date. Without the deal team in place right from the start, it would have been difficult to bring the necessary individuals up to speed in time to support the project timescales.
The project includes local and overlay cash pools that will allow AkzoNobel to centralise its cash across 27 countries. In addition, the payment factory is being extended from four countries to cover commercial payments in 27 countries, and support both local and central services. SWIFT is being used as the bank communication platform across the group.
A project of this scope and complexity inevitably brings challenges, one of which is how to manage the payment factory and cash management requirements at a pan-European level, whilst also ensuring that local needs are accommodated. It quickly became clear that although the pan-European elements of the project had been defined, there were additional requirements that were not fully clear during the RFP phase. To address this, ING took a flexible approach, and undertook a series of scoping sessions covering each location, involving local controllers, to understand the specific issues in each country. This then enabled us to formulate a detailed project scope that satisfied the needs of group treasury and local business units.[[[PAGE]]]
The implementation started with an initial kickoff in Arnhem in July 2009 which marked the beginning of a rapid, intense and challenging project which was ultimately successful thanks to the commitment and effort put in by both AkzoNobel and ING personnel. There were a number of factors that added to the complexity of the project, but also a variety of reasons why we were able to achieve its objectives on time.
For example, one challenge was that the cash management project was just one element of a wider transformation project, and the timelines and deliverables for some parts of the project, such as the in-house bank and technology components, were already defined, so we had to organise the project plan around existing, challenging milestones.
Secondly, while AkzoNobel’s requirements were consistent with other leading corporations that are focused on best-practices for financial management, the scale of the project was considerable and required both local and central resources.
We also needed to maintain an awareness of the local implications of the project. In addition to the payment factory and cash pool, the in-house bank was being implemented concurrently. Therefore, although ING was key to the project, and to AkzoNobel’s ongoing financial optimisation, AkzoNobel rather than ING will be the counterparty for local business units in the future, which we needed to respect in the way that we organised the project.
To be successful, while the quality of ING’s products and services were important, it was also vital that we worked together as one team, with common objectives and priorities, relationships of trust, and open lines of communication. With in-country project teams as well as a central team, we needed to ensure that each element was closely co-ordinated with a single version of project documentation. By holding regular project meetings, with a steering committee comprising senior sponsors from both AkzoNobel and ING, any issues could be raised and resolved. We also had telephone meetings each week per country and per solution, and another to discuss the project plan.
The collaborative and constructive efforts across the AkzoNobel and ING project team continue, as the project moves from the initial four countries to the remaining 23. For example, we are now preparing for ‘go live’ in the next group of countries in October 2010, and we aim for payments and cash management to be live in all countries by the second quarter of 2011. It is easy to treat a project as simply a series of milestones and tasks on a project plan. While project success is partly determined by meeting deadlines, which has been achieved with this project so far, the quality of the delivery, and the ability to achieve business objectives is of even greater value. It has been a privilege to work with AkzoNobel on this project and we look forward to continuing success as the project extends across AkzoNobel’s European footprint.
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