First Class Relationship Management Highly Commended: Microsoft

Published: Jul 2019


Photo of George Zinn, Microsoft and Meg Coates.

Pankaj Gudimella



Founded in 1975, Microsoft is the worldwide leader in software, services and solutions that help people and businesses realise their full potential.

Ultra-lean Microsoft team delivers treasury leading edge custody services upgrade

The challenge

A request for proposal (RFP) was produced by Microsoft treasury to review custody services across all major providers – something that had not been done in over a decade. The objective of the RFP was to ensure that Microsoft has the best in class global custody services for operational excellence across a complex core of cash processing comprising trade settlement, income processing, corporate actions and collateral management.

The critical importance of this cash processing core to Microsoft has been stressed by the company’s Corporate Vice President and Treasurer, George Zinn. In a recent statement to Microsoft’s investment operations team he said the core “is not something we take lightly”.

The RFP itself was complex, detailed and designed to help ensure that Microsoft’s complex corporate treasury structure would successfully secure a best in class custody provider technology platform.

The solution

After Microsoft announced that it had selected BNY Mellon as its global custodian, both parties came together and formed a lean virtual-team that successfully executed the complex transition in a record four months, using best in class project management practices and collaboration software like Microsoft Teams, the hub for team collaboration in Office 365 that integrates the people, content, and tools teams need to be more engaged and effective.

Key metrics that provide an indication of the scale of transition include: the creation of 125 custody accounts; over US$135bn in assets moved; coverage of five asset classes; 50 global markets opened; 50 ISDAs/CSAs set up with collateral management group; and hundreds of millions of US dollars in collateral exposure carried over from the prior custodian to the bank.

Best practice and innovation

To successfully execute a complex transition like this would normally take a large team dedicated over a long time. In this specific transition, the team did a few unique things in order to land the project on time. This included the creation of a lean and nimble team across Microsoft and the bank that used best in class project management practices.

The team used collaboration software (Microsoft Teams) in order to communicate with group chat/online meetings/calling and to collaborate on files within one workspace with end-to-end security enabled. This helped eliminate email volume and the necessity to go to multiple places to get access to documents and chat threads, making the project team efficient.

On the go live date, the team was able to get reporting/analytics enabled using Power BI. This helped the team get a thorough handle on the custody assets that have been transferred and the reconciliation therein. This was one of the smoothest executions of a very complex initiative.

For the Microsoft project team members, the work under the initiative was in addition to their full-time responsibilities related to managing operations for the company’s US$135bn portfolio. Team members included Sanisha Popovich, Joshua Freese, Eric Barka, Hannah King, Fabiola Miranda, Michelle Christensen and many others from various teams across Microsoft.

In effect, the implementation of the solution amounted to one of the most significant changes Microsoft treasury has undertaken in the past ten years.

Key benefits

Using Microsoft Teams to run the project from start to finish, the following benefits were secured:

  • Reworked dataflows between BNY Mellon and BlackRock to remove Microsoft as the middleman.
  • New custodian can automatically split large trade blocks into U$50MM for FED and DTC settlement. For Microsoft, this eliminates the manual work involved in splitting trades before sending them.
  • Private equity, real estate, strategic equity and limited partnership capital calls are automated with dual front/middle office authorisations via the bank’s Nexen platform.

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