SWIFT and Payment Factory projects Gary Starling, Accenture London Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.
Agenda Accenture Where is the market? What is a Payment factory project? What are the challenges and improvements? Case Study Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 2
Accenture Accenture Key Facts Revenues of US$ 19.7 Bn for fiscal year 2007 60% consulting, 40% outsourcing Return to shareholders of 107% between IPO and end FY07 Working with 94 of the global Fortune 100 and ~68% of the Fortune 500 175,000 professionals in 150 cities in 49 countries, of which - over 100,000 in Business and Technology Consulting Investment in R&D of US$ 300m and training of US$ 776m Connected through a global knowledge and methodology management system Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 3 3
Treasury Operational Excellence Offering Offering Organisational strategy and design Cash management, including banking relationships, cash pooling, cash flow forecasting Risk management in terms of FX, interest rate and commodity risks and hedging Treasury system selection and implementation Streamlining middle and back office functions Changing treasury from a cost centre to a value added service centre Value Reduction in interest and bank charges Improved process efficiency and effectiveness Improved risk framework and control Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 4
Agenda Accenture Where is the market? What is a Payment factory project? What are the challenges and improvements? Case Study Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 5
Where is the market? In the UK, the take up of SWIFT is increasing in the very large multinational corporations Bank communication and in house banking are leading the way with payment factory projects being investigated For the past 4 years, Accenture has achieved great success in France on treasury projects on SWIFT projects for Total, Schlumberger, Alcatel, Danone, Veolia, Areva,. Mid corps are reluctant to go for SWIFTNet and there is a lot of interest in SWIFT llite Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 6
Agenda Accenture Where is the market? What is a Payment factory project? What are the challenges and improvements? Case Study Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 7
What is a Payment Factory Scope : Centralise group payments Inter company External Treasury, AP Payment on behalf versus Centralise reporting from banks. Corporate Payment request (treasury, local payments, international payments) Direct debits, BACS Bill of Exchange remittance. BANK Banks Bank statements Rejected files Acknowledgements. Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 8
Payment Factory functionality Different functional blocks may be necessary to build a payment factory. BU 1 BU 2 BU 3 BU n Order acquisition Payment optimisation routings (In house bank) Reporting Validation Authorisation Transactions management SWIFTNET BANK BANK BANK BANK Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 9
Benefits of a Payment Factory Payment factories and centralisation of banking communication projects usually have high ROI with tangible financial benefits: Hard: IT/IS costs reduction of e-banking platforms Lower resource - STP = Process automation and standardization Netting /aggregation of payments - Inter company External / supplier consolidation Low unit payment costs - Optimised routings to the banks Soft: Cash visibility /working capital Bank independence Improve controls SOX Reduce risk errors/fraud Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 10
Costs of a Payment Factory The costs can be split into three phases; setup, deployment and ongoing costs: Setup Deployment Ongoing Software licence Site Setup (x sites) Data centre SWIFTnet Formats Service bureau Integration with TMS/ERP Licence/ support Business analysis Project Management Project Management Business support Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 11
Challenges in implementation Globalisation legal, tax and regulation Connectivity bank readiness / formats Contracting - Large volume of legal documentation Implementation - Project contacts knowledge Operational challenges - SEPA / real time reporting Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 12
AGENDA Accenture Where is the market? What is a Payment factory project? What are the challenges and improvements? Case Study Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 13
Client experience: Large global company in engineering Client Overview The client is a leading supplier of technology, project management and information solutions. It is a global growing company with multiple locations and Treasury/ AP Centers. Business Challenge Identified areas of improvement Securitization of electronic payment processing Reduction of the existing numerous manual tasks Low Cash Management culture of the field Complexity in nature and volume Multiple financial flows (cross-border, domestic, FX, Interco, payroll) Idle cash Multiple bank partners How Accenture Helped Feasibility assessment Inventory of existing EBS and banking landscape Contribution to the business case Bank Communication Software Selection Draft request for proposal Create selection grid based on functional and technical requirements Analyze and recommend Pilot deployment Collect requirements, configure software Integrate in Company s landscape Worldwide deployment Define deployment strategy Execution Contribute to Early Adopter Program for Liquidity Management Key Technology: Trax (Sungard) Integration with SWIFTNet via service bureau (ONFIN/ BNP Paribas) Integration with Quantum (Sungard) PKI High Performance Delivered With Accenture s help, the company has: Single fully secured cash management platform between the Group treasury and the subsidiaries, and their banks, improving working capital management Reduced errors and fraud risks, harmonized cash management processes, facilitation of SOX testing Reduced costs (Infrastructure and transactions) Improved control of banks relationships Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 14
APPENDICES Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 15
PAYMENT FACTORY What are the costs? Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 16
Impossible d'afficher l'image. Votre ordinateur manque peut-être de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peut-être supprimer l'image avant de la réinsérer. Impossible d'afficher l'image. Votre ordinateur manque peut-être de mémoire pour ouvrir l'image ou l'image est endomma gée. Redémarre Impossible d'afficher l'image. Votre ordinateur manque peutêtre de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peutêtre Impossible d'afficher l'image. Votre ordinateur manque peutêtre de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez Impossible peutêtre d'afficher l'image. Votre ordinateur manque peutêtre de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez Impossible peutêtre d'afficher l'image. Votre ordinateur manque peutêtre de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peutêtre supprimer Impossible d'afficher l'image. Votre ordinateur manque peutêtre de mémoire pour ouvrir l'image ou l'image est endommagée. Redémarrez l'ordinateur, puis ouvrez à nouveau le fichier. Si le x rouge est toujours affiché, vous devrez peutêtre supprimer IMPLEMENTATION ECOSYSTEM High level view of the implementation activities Project organization: A central team: Deployment covers functional requirements and relations with banks and affiliates Solutions covers all technical aspects and format developments Deployment is conducted remotely: Few on-site visits Communication mainly via phone/ email Use standard documentation Large project needs strong sponsorship: Numerous stakeholders internally: IT, Cash Management, Treasury External stakeholders: Swift, Bureau, Integrator, Banks, IT Prepare locations Establish Support Connect in-house bank Establish communications Company Network Develop and test formats In-house bank P-platform ERP ERP P/R Comp s Affiliates Company Register with Swift Connect Bureau, establish communications Affiliates Banks Define solution Connect Banks Develop and test formats Configure application (interface, business rules, workflows) Test Recurring activities during deployment phase need industrialization Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 17
IMPLEMENTATION PHASES Main activities SWIFT WORKSHOP REGISTER PROD EDITOR SELECT WORKSHOP INSTALL & CONFIGURE PROD SSB SELECT ESTABLISH COMS TEST PROD BANKS BANK STRATEGY/ SWIFTNET RFI PRESENT PROJECT DEFINE SOLUTION & PLANNING CONNECT DEVELOP AND TEST PROD CONTRACTING / LEGAL DOCUMENTATION AFFILIATES DATA GATHERING WORKSHOP REVIEW GAPS/ CUSTOMIZATION ESTABLISH COMS SETUP & TRAINING PROD Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 18
DEPLOYMENT PHASE Deployment methodology with sites 1-2 months WORKSHOP 2-3+ months GO-LIVE Local coordinator Nomination Local coordinator Kick off call Workshop Preparation Workshop Deploymen t activities Go Live activities Production Support and Benefits Tracking Involve site s Senior Manager for sponsorship, nominate local relay Challenges: Obtain Site s buy-in Review project with local relay, explain methodology Send data collection document (payments, processes, IT) Review current and target processes, analyze gaps Complete security matrix, IT requirements, master data migration, UAT and training Ensure local specificities and requirements are adequately captured Manage gaps Enhance existing solutions Use application, provide feedback, help tracking benefits Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 19
DEPLOYMENT PHASE Deployment methodology with banks ORGANIZATION IMPLEMENTATION (3-6+ MONTHS) Confirm scope with Cash Management Challenges: Investigate Swiftnet capabilities Send out Swiftnet RFI Kick off with bank Present project, team and methodology Structure of the project team on the bank s side - Undertake connectivity FIN/ FileAct - Review and develop specs Bank knowledge and ability to explain local specificities to a global team Bank appetite to undertake developments to encompass local specificities (regulatory reporting, taxes, payroll ) Complexity of Legal documentation Confirm scope and solution design Setup, develop and test Negotiation and finalization of Legal doc Agree on planning, design and formats Verify and Go Live Production - Process few payments in Prod - Ensure acc sttmts received Confirm contacts in Prod Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 20
IMPROVEMENTS Global solutions need standardization Industry leadership: Sensitize banks on Corporate access to Swiftnet, ensure the right contacts are in place Keep working on standardization of bank formats, dematerialization and implement solutions to capture all payment types (taxes, regulatory reporting) in all formats; banks to ensure they can all be processed in their systems Enhancements to payment processing: Take advantage of the flexibility of the Fileact route to provide customers with detailed reports on that status of their transactions, facilitate reconciliation Minimize the number of parameters implemented by ensuring all bank branches can be accessed from a single point of entry Signature on payments files Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 21
IMPROVEMENTS Global solutions need standardization Support: Adapt communication: Corporates are not supposed to be experts in this domain Provide them with expertise on Technology and Formats, assist in resolving connectivity issues Implement a knowledge base of fileact parameters and local specificities, implement standard parameters templates Documentation: Banks to adapt their corporate requirements and simplify access to gateways and back-ends Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 22