Treasury Management International
Financial Technology
Page 1 of 2
Leveraging SAP and SWIFT for Treasury Optimisation -
The experience of Samsung Electronics Co., Ltd. with Bank of America
“Our Global ERP project was an undertaking of critical importance for our company and we were looking for the best in terms of treasury management support. Our decision to work with Bank of America was based on our long-standing relationship and first-hand experience with its leadership in pioneering treasury management services and deep commitment to cutting edge technology solutions.”
Taehyun Kim, Senior Manager, Global ERP Task Force, Corporate Treasury, Samsung Electronics Co., Ltd.
In April 2004, Samsung embarked on a five-year project focused on standardising rules, data and processes across all Samsung entities globally. Specifically, Samsung was looking to integrate all of its disparate systems into a single global Enterprise Resource Planning (ERP) platform based on SAP R/3, a company-wide platform designed to co-ordinate all resources, information, and activities associated with business processes such as payments and billing.
An integral part of this project was to optimise Samsung’s treasury operations by linking SAP to SWIFTNet, the company’s choice for a platform-neutral global electronic banking network. Specifically, Samsung’s objectives included: consolidating its numerous banking communications into a single channel using SWIFTNet (joining SWIFT under the SCORE model); and standardising the company’s electronic messages to the SWIFT standard ISO message format.
Samsung selected Bank of America to advise on and implement its treasury management initiative based on the bank’s leadership in technology and proven track record with Samsung. Bank of America’s mandate was twofold: to assist in achieving Samsung’s objective to integrate all entities into a single global ERP system, which would be linked directly to SWIFTNet; and to support the company’s goal of standardising its electronic message formats for Bulk and Ad hoc Payments, FX Confirmations and Bank Statement Retrieval (Information Reporting).
Existing processes
Previously, Samsung’s Regional Treasury Centres (RTCs) compiled payment files and sent them to their respective partner banks using a variety of different formats and methods. The banks, in turn, received the bulk files and disbursed payments regionally or locally. Each Samsung company handled its own EDI (Electronic Data Interchange), cheques, and internet banking for ad-hoc and other discrete local payments. This meant that for regional bulk payments, payments data needed to be compiled by the RTC from standalone ERP systems used by the different Samsung companies. The RTC then had to release the consolidated data to the designated regional partner bank for general disbursement.
For local payments, each company maintained different channels for various locally disbursed payments, which made it challenging to maintain consistent rules, master data and processes across the various Samsung entities. Samsung recognised there was room for further improvement, specifically around reducing duplication, increasing automation and achieving a greater degree of standardisation.
The solution
The broader initiative to consolidate Samsung’s ERP systems into a single global ERP system, the availability of the SWIFT SCORE model, and growing acceptance of ISO message formats such as XML ISO 20022 meant that these improvements could now be achieved by linking the new SAP system directly with SWIFTNet, enabling Samsung’s treasury to process each entity’s bulk and ad-hoc payment needs through SWIFTNet using standardised ISO message formats.
Payments STP
Key payment processes such as Accounts Payable proposal, payment confirmation, payment initiation and payment status check can be subject to straight-through processing (STP) in SAP, thereby significantly reducing duplication, increasing automation and significantly enhancing the consistency of processes.
|
Save PDFs of your favorite articles, authors and companies. Bookmark this article, or add to a list of your favorites within mytmi. |
|
 Share this article |  Share article on LinkedIn
|
 Share article on Facebook
|
 Share article on Twitter |
Related Articles
Integration and Optimisation at Raymond James Financial
Supporting Exports with HERMES Export Credit Guarantees
Implementing Technology to Achieve Group Strategy
Treasury Management International showcases topical, pragmatic solutions and strategic insights on treasury, cash management, foreign exchange and other issues affecting treasury and financial professionals, together with treasury and finance news, education and opinion. With real-life treasury management experiences and case studies at its core, TMI provides valuable material for all practitioners - from experienced treasurers and CFOs to those new to the profession.
ADVICE TO READERS
While all reasonable care has been taken to ensure the accuracy of the publication, the publishers cannot accept responsibility for any errors or omissions. All rights reserved. No paragraph or other part of this publication may be reproduced or transmitted in any form by any means, including photocopying and recording, without the written permission of Treasury Management International Ltd or in accordance with the provisions of the Copyright Act 1956 (as amended). Such written permission must also be obtained before any paragraph or other part of this publication is stored in a retrieval system of any kind.
© P4 Publishing Ltd
Registered in England and Wales Number: 05838515
Design by Greenfisher | Web Development by RedGreenBlue
