The challenge

Şişecam has complex treasury operations in 21 countries, including the countries where it manufactures, but treasury operations are managed from its Turkey HQ. With increasing risk of fraud, risk management across the enterprise had become increasingly problematic. Given the disparate operations and multiple bank files and payments, treasury management was challenging for the following reasons:

• Cash management reporting took place monthly, with individual subsidiaries reporting at the end of the month.
• Payment files were sent to banks via file transfer protocol with written instructions sent by fax and email, which required between 30 and 60 minutes to execute a payment.
• With these manual processes, it was difficult to monitor and track payables.
• Labour-intensive, which added a high level of risk.

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The solution

After the SWIFT implementation with global banks such as Citi and local banks such Türkiye İş Bankası, Şişecam was able to monitor its cash management daily and manage its payments centrally. With the implementation with Kyriba, Şişecam centralised treasury operations in 21 countries across Europe, the Middle East, Africa and Asia from multiple systems, email, fax, and spreadsheets to one consolidated and dynamic view in a single dashboard. SWIFT MT940 end-of-day bank account statements of over 1,000 accounts are now being received through Kyriba, which means the company has a real-time view of its cash positions. Furthermore, all payment instructions must now be generated through Şişecam’s ERP and transmitted to Kyriba to be digitally approved by signatories, eliminating the risk from manual, untracked processes. The system is closed to manual intervention, and each of the payments is successfully transferred to the banks once fraud controls have been completed and it takes between eight to 15 minutes to execute a payment. In addition, the digital approval process has provided significant benefit for signatories working remotely due to COVID-19.

Best practice and innovation

The digital transformation project centralised cash management operations for Şişecam and its subsidiaries while reducing risk from payments fraud. This new, modern structure offered Şişecam the flexibility to support its ongoing growth. The platform provides real-time monitoring and straight through processing (STP) of transactions.

Historically, connectivity between banks and organisations has been highly manual and required a large amount of time, resources, and cost to enable some level of integration between systems. However, Şişecam managed to establish end-to-end integration and automation in both payments and collections which enabled the company to have full visibility without any manual processes that might be subject to human error.

Key benefits

• Leveraged host-to-host connectivity to conduct efficient payment, collection, and reconciliation activities in ERP.
• Enhanced real-time visibility (99%) of cash and liquidity across the organisation.
• Real-time information and easy statement access.
• Consolidation and efficiency via single platform and reduced number of banks.
• Reduced risk of manual entry.
• Reduced fraud risk as fraud detection is applied on every payment initiated. The payments are separately reviewed within the scope of fraud rules determined by the fraud scenarios. If there is a violation of the rules, the payment is stopped, and an alert e-mail is automatically sent to the internal fraud team. This is another crucial benefit of the project.

“This new structure offers us the flexibility and efficiency to support our ongoing growth by providing more sophisticated, real-time financial controls over our domestic and international operations. Risk is reduced and monitored, and the efficiencies of our operations are being realised across the organisation,” says Baris Gokalp, Global Head of Treasury.

The Adam Smith Awards is the industry benchmark for best practice and innovation in corporate treasury. The 2021 Awards attracted a record-breaking 309 nominations spanning 40 countries. To find out more please visit: treasurytoday.com/adam-smith-awards.