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Optimising Payments and Cash Management with SAP and SWIFT

Danfoss has a commitment to excellence across all of its business operations, so in late 2008 we embarked on an initial study of potential improvements that could be made to our treasury management infrastructure. While our treasury already demonstrated industry best practices in many of our activities, we recognised that there were some areas of potential improvement.

For example, we identified that payments processes could be improved and automated through a payments factory and in-house bank, supported with enhanced bank connectivity. We also wanted to replace our legacy treasury management system (TMS) and improve our cash flow forecasting processes.

Key Points

  • Danfoss decided in 2008 to improve the infrastructure of its treasury by implementing a payments factory and in-house bank plus replacing its TMS and improving cash flow forecasting
  • Further associated changes included optimising the company’s SAP installation and connecting this to its banks via SWIFT
  • EDIFACT was implemented for its Nordic banks and XML ISO20022 is to be used for international banks
  • The author describes the progress of this complex project and outlines future plans including expansion of the services offered by treasury to the business

 

Written by

Palle Dedenroth
Director, Assistant Treasurer - Treasury Operations
Danfoss

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