Photo of Sadachika Yoshioka, J.P. Morgan, Judith van Paassen, Zanders, Hiroyuki Ishiguro and Gurmeet Jhita, the Sony Group, and Mikio Naito, Citi.
Hiroyuki Ishiguro
General Manager, Treasury Section, Finance Department, Sony Group Corporation
Gurmeet Jhita
General Manager, Head of Accounting, Sony Global Treasury Services Plc
Terry Vouvoudakis
Assistant Director, Sony Capital Corporation
Sony Group Corporation
Sony Group Corporation is a creative entertainment company with a solid foundation of technology, with revenues of nearly ¥10trn, and employs 108,900 people worldwide as of 31st March 2022. The Sony Group has six main business segments: Game & Network Services; Music; Pictures; Entertainment, Technology & Services; Imaging & Sensing Solutions; and Financial Services.
in partnership with
Digital transformation of Sony Group’s global treasury platform benefits subsidiaries around the world
Introduction: a story of FX automation
It used to take Sony Group’s FX team 15 minutes to centrally hedge FX trades for the group’s subsidiaries in a laborious, manual process requiring multiple entries and validations to prevent errors. Implementing an end-to-end automation of FX hedging processes for all Sony Group’s subsidiaries globally is truly best practice.
Now the end-to-end automation of all FX hedging processes allows dealers to execute best priced deals with quoting banks in a fast, scalable, accurate, automated, and integrated process that has significantly reduced errors.
Furthermore, Sony automated back office functions of FX confirmation matching, FX settlements and bank accounts reconciliation, as part of the FX end-to-end automation.
“The new system allows us to execute FX deals at the best price in under two minutes,” says Sony Group’s FX dealer.
The FX automation is one of the best practices that Sony Group implemented successfully.
Here is Sony’s journey of global treasury transformation.
How it began
Restricted by old legacy systems and bottlenecks, it was becoming increasingly challenging for Sony Group’s global treasury centre to meet the demands of a rapidly changing world.
Sony Group Corporation embarked on a project to enhance its treasury organisational network across Japan, the USA, UK, Singapore, and other regions with a single TMS platform replacing the legacy systems. The project team executed BPR, standardising, simplifying and automating Sony’s treasury operations by utilising new technologies. It involved connecting with banks and subsidiaries and working together with diverse project members from eight countries around the world.
In-house-bank for more than 20 years
Following Request-for-Proposals (RFP) and Fit & GAP analysis, Sony Group selected SAP S/4HANA Treasury as the TMS platform. The solution was the best fit for the company, particularly using SAP in-house-cash (IHC) to replace Sony’s own bespoke system with In-House-Banking (IHB) functions that had been utilised for 20 years. It enhanced Sony’s IHB to make Payments on Behalf of Subsidiaries (POBO), Internal Cashless Payments, Internal FX settlements and ZBA account balance sweeping to minimise external funding.
People and technology
A key to success lies in how Sony Group empowered its own employees to introduce new technologies whilst also working together with partners. Under the banners of Sony’s Purpose to “fill the world with emotion, through the power of creativity and technology” and its corporate direction “getting closer to people”, the project team built strong relationships amongst diverse internal and external teams, working side by side globally to cultivate innovation skills. External partners were also very important. Banks supported the implementation of banking innovation; SAP’s support was essential, and Zanders contributed strongly as SAP S/4 HANA treasury experts.
FX risk management, cash management and In-House Banking (IHB) processes are now fully optimised, taking advantage of the latest cutting-edge technologies. For example, the Sony Group implemented SAP S/4HANA Treasury, SAP Cloud TPI connectivity with 360T FX Trading Platform, and SAP IHC (in-house-cash), and SWIFTnet connectivity and ISO 20022 XML messages to integrate with banks globally.
Deep-dive discussions, testing and penny trials to prevent “negative surprise”
Deep-dive discussions and intensive workshops, Proof-of-Concept (POC), in-depth testing and penny trials were critical to success together with enhanced project management. Penny trials were executed in production environments after testing all scenarios with all parties, given testing environments may work differently from production environments. For example, the project team executed penny trials by using the new TMS and sent small payment requests (like USD100) to banks in production environment. Penny trials were completed successfully for all scenarios before business go-live with the Sony Group’s subsidiaries to prevent negative surprises.
The Sony Group began its global treasury transformation in May 2018 and completed the final go-live in November 2021 despite COVID-19. The new TMS was implemented globally, operational throughout the Sony Group’s treasury centres and providing treasury services for subsidiaries comprising 337 entities across 52 countries
It is an honour for us to receive such a prestigious award. We would like to express our sincere gratitude and congratulations to all our partners for great support and strong efforts.
This award is granted for the Sony Group, because of the following two main reasons:
- A global-scale treasury transformation rather than a regional one.
- A business transformation across whole group by making full use of new technologies or Digital Transformation (DX).
The award recognised the Sony Group as a best practice to strengthening and re-building global treasury organisation structures, empowered by a new treasury platform called “METRO”, to provide financial support for the Sony Group entities globally.
The Adam Smith Award is a prestigious award in corporate finance, respected around the world. Global excellent companies such as Microsoft, Alphabet (Google) and Roche have been Overall Winners of the Adam Smith Award in the past. In the case of Japanese companies, overseas finance subsidiaries often receive individual awards, and it is exceptional for the Japanese headquarters to receive awards in collaboration with the overseas finance subsidiaries. We would like to continuously work closely with our partners, and to contribute to the enhancement of corporate value of the Sony Group through various financial supports for each business.
Hiroyuki Ishiguro, Finance Department, Sony Group Corporation, Japan
It is a great honour to receive the award. An amazing achievement, especially considering the calibre and achievements of the nominees.
The project was far more than a digital transformation (DX) utilising new technologies, as it successfully implemented end to end treasury best practices and straight through processing, seamless integration connectivity across diverse applications, enhanced subledger reporting, whilst developing a robust SoD and controls framework. This was only made possible through close collaboration across all Sony businesses globally (other than Financial Services), alongside Finance, Accounting, IS, Tax and Risk & Control. This enabled significant rationalisation and the realisation of compelling synergies, whilst protecting and enhancing governance and compliance.
The overall solution also allows agile scalability, and flexibility to react to changes in market conditions, and/or tax, legal or regulatory requirements.
This is a truly remarkable project and testament to the incredible talent that we have within Sony.
Gurmeet Jhita, Sony Global Treasury Services plc, UK
Congratulations to everyone involved in the project, including all our external partners! Because it was a total team victory!!
I would like to talk about the benefits for each of the Sony Group subsidiaries. Looking at the project from the Sony Group subsidiaries point of view, it was very important to have one system where they could track their balances, initiate cash and cashless payments and request MM & FX transactions. End users enjoyed everything the system offered.
First of all, FX Deal Management function was welcomed most by the Sony Group’s subsidiaries. Secondly, Internal Cashless Payments* are enhanced, to be utilised globally by as many Sony Group subsidiaries as possible. The reporting function became very useful.
METRO is a forward looking treasury system that the Sony Group’s subsidiaries can use for many years to come.
(*Internal Cashless Payment: for payments within the Sony Group, METRO Internal Cashless Payments do not get charged by banks, and reduce payment errors.)
Terry Vouvoudakis, Sony Capital Corporation, USA
Photo of two overall winners, Hiroyuki Ishiguro, Sony Group Corporation (centre, 5th person from the left), Gurmeet Jhita, Sony Global Treasury Services plc (3rd person from the left), together with Vitantonio Musa and Lee Titchmarsh (1st and 2nd person from the left) and Fred Pretorius (1st person from the right), Sony Global Treasury Services Plc, also with Judith van Paassen (centre, 6th person from the left), Laura Koekkoek (centre, 4th person from the left), Beliz Ayhan (2nd person from the right), Zanders.
