Treasury transformation is not just for well-established FTSE 100 corporates. Other large companies can benefit just as much from overhauling their central treasury processes, allowing them to better service the business and to position for future growth.
Like geotechnical specialist Keller Group, a FTSE 250 constituent with operations in 37 countries and a £3bn turnover, where Group Treasurer Sean Privilege has just overseen a wholesale overhaul of the company’s central treasury function.
“All our transactions and processes were managed using Excel worksheets, with associated payments made via proprietary banking platforms, tying up a number of finance team members in daily non-value add tasks,” he says in an interview with Treasury Today from the company’s London head office. “We manually settled everything and confirmed all trades via e-mail.”
A native New Zealander, Privilege landed in the UK in 1998, originally planning to travel Europe in a camper van. That changed when he landed a job as a back-office analyst with Shell where he ended up staying for eight years, during which time he gained valuable knowledge and experience of treasury best practice. Long tenures at Visa and later John Lewis followed, until he joined Keller as Group Treasurer in 2023.
“I was bitten by the treasury bug,” he laughs, reflecting on his initial carefree plans.
As soon as Privilege joined Keller, he set about transforming treasury. The process began with selecting Kyriba as TMS, partnering with Finastra to automate trade confirmations and Refinitiv for consistent market data to feed into group systems.
“We are nearly there,” he says. “Following an RFP process last year, we kicked off the project in January and are now almost live. The new systems are almost in place, and this will allow us to switch from time intensive and less reliable manual processes to straight-through processing. By reducing manual processes and reducing time spent on daily operations we can spend more time on initiatives that drive greater economic value for the group.”
This level of rapid transformation is unusual for a FTSE 250 where he says treasury transformation can be “hit and miss.”
Although some corporates might have a TMS, few have activated payments or fully integrated ancillary treasury systems, for example. But Keller’s quest to professionalise treasury coincides with the company’s strong organic growth that required more centralised processes.
Lessons learnt
One of the most important elements in the build was calling in extra resources, including an interim treasury manager and a treasury systems consultant. “A transformation process like this can be time consuming and challenging, and as a small team we realised we needed to parachute in more resources.” He says the build was also supported by Keller’s “pragmatic and positive” leadership team.
The transformation has attracted upfront cost, but the benefits in control, straight through processing, cash visibility and system enforced segregation of duties is money well spent. “Once the TMS implementation is complete, we can leverage the system to support cash concentration and streamline cash repatriation. We’ve improved control and our bottom line.”
Privilege also espouses the benefits of information management. A new treasury reporting system captures information on trapped cash and FX risk, encouraging finance teams to adopt a new focus when thinking about treasury risk and the bottom line. Visibility around counterparty credit risk has also improved.
New data flowing into the company reveals real-time market analysis providing a “really good view” of risk. “None of this is ground-breaking, but in a short time it’s possible to rapidly transform and strengthen treasury processes,” he adds.
His next focus is on reducing multiple banking partners across the group. The company’s businesses across Europe and APAC each have multiple banking partners and systems. “By strengthening the central treasury function, we can provide a better service to our local teams and this should allow us to rationalise the use of non-relationship banks.”
Part of the overhaul will include giving this ancillary business to key banks that are supporting the company, he concludes.
