Replacing eleven banks with just one
Sapa enlists BNP Paribas Cash Management
Sapa, the world leader in aluminium extrusions and building systems, has signed up BNP Paribas as its single banking partner in their southern Europe area. Replacing eleven existing banks in France, Italy, Portugal and Spain, BNP Paribas was chosen for its full range of products and its flexibility in meeting specific customer needs.
Johan Egir, Senior Cash Manager at Sapa: “The point is to move away from being a transactional treasury to be a more strategic contributor to the Group. We realised that the service and the footprint of BNP Paribas was a good match for us.”
Plans were ambitious, with complex entities and services to migrate, bringing their own challenges to stay on track with the timing:
36 accounts over 30 legal entities;
Connexis for 122 users;
Local e-banking solutions: EBICS in France and Business Way in Italy.
Sapa had already chosen to implement a payment factory, liquidity forecasting and an in-house bank and had selected Opus Capita as their solution provider. But BNP Paribas provides solutions that were a good fit with the Sapa “highway” of transaction processing and set-up where Connexis works well for contingency and integration with Sapa entities not on core ERP systems.
In addition, Sapa preferred to centralise on-boarding processes in Norway and negotiate all the contracts and legal documents, while agreement between countries took time and effort due to local conditions.
After the bank’s initial proposal in June 2015, and from a standing start in September 2015, the cash pool went live in March 2016 and e-banking was in place by June.
In Johan Egir’s own words: “the implementation is nothing but a success”, and for BNP Paribas reinforces “its credibility in the Nordics as the best international Cash Management bank”.
This achievement has strengthened the relationship between Sapa and BNP Paribas. After the migration of cash management in southern Europe, the next step for Sapa is to launch a similar exercise in its Central and Eastern European divisions, which includes Germany, Austria, Switzerland, Turkey, Slovakia, Hungary, Romania, Bulgaria, UK and the Czech Republic. BNP Paribas will of course be submitting its proposal.
China is very much in Sapa’s sights, with India also on the horizon in 2017. The company recently mandated BNP Paribas to be their overlay cash management bank in China, in the face of strong competition from other international banks. “There is some complexity there,” admits Hans-Erik Trulsen, Cash management Director. “Nevertheless, it’s well worth pursuing.”
The Sapa Group – Pride in sustainability
Sapa is the world leader in aluminium solutions and has 23,500 employees in more than 40 countries, with its headquarters in Oslo, Norway. It is the largest aluminium extrusion-based solutions company in the world, with 100 production sites and 1,000 engineers working in research and application development.
The company delivers aluminium solutions to every industry from interior and furniture to automotive, through building and construction, mass transportation, electronics, offshore and maritime. Sapa AS is a 50/50 joint venture between Orkla ASA and Hydro ASA.
This pride in innovation and sustainability is exemplified by the energy-positive building Powerhouse Kjørbo. On the outskirts of Oslo, this office building from the 1980s has been renovated to produce more energy than it consumes. Sapa, a strategic partner in the process, contributed expertise, and façade and window technology to help create one of the most environmentally friendly office buildings in the world.
ONBOARDING: A client view
Banking relationships can be intricate, and are built up over years, maybe even decades. It’s a daunting task to dismantle and rebuild this complex eco-culture. We all know from our personal arrangements the potential trauma of switching banks.
But this fearsome process of onboarding – what does it look like in reality? We asked the customer.
From dynamic treasury to strategic contribution
The Sapa joint venture began in 2013, bringing together two of the top companies in the world for aluminium extrusions, each with their own systems and culture, not least from a finance perspective. “Since the merger, Sapa has had a very dynamic treasury environment,” explains Johan Egir I think the point is to move away from being a transactional treasury to be a more strategic contributor in the Group – it’s important for us to stay on that development track.”
In BNP Paribas, Sapa found a “very valued partner” in this.
One step at a time
So how did they approach the complex task of migration? The answer was to take it one step at a time, not trying to take on the whole of Europe in one go. Johan Egir: “I think that it's wise to chop it up into smaller projects, to be able to finalise something and then implement it.” Even so, the four countries of southern Europe (Spain, Portugal, France and Italy) involved 30 entities and 11 banks to be replaced.
But it was the work done by BNP Paribas with its eye for detail, producing a thorough inventory of tasks to be achieved, which made it easier to navigate the complexities of the variety of ERP systems and SWIFTNet FileAct.
A simple life
Moving from several old non-core banks in many cases to just one bank involved a lot of changes. Connexis and Business Way were introduced, following years using several proprietary systems. “It was a simplification and involved process changes. That impacts people,” he continued.
It was also an opportunity for Sapa to automate time consuming manual work.: “It’s been a complex and heavy time, but it’s all been done, and that’s nice.”
“BNP Paribas was active in terms of presenting opportunities, such as using metrics to power our strategic vision. We obviously saw that they had the service and the footprint that was fitting in to what we wanted.”
Commitment at every level
The key to implementation began with full commitment from Sapa’s top management to the project: “That’s the background you need, but local finance people need to be involved at an early stage too,” says Hans-Erik Trulsen. “Not just country by country but business by business.”
But an important aspect that Sapa never lost sight of was that they needed to recognise that they were actually going to change people’s everyday jobs too. “You’re changing their habits. You’re changing their way of working, so you need a lot of respect for that. To get it to work, you need local buy-in from the very start,” says Johan Egir. “You need them on board.”
Any lessons to be learned?
Paperwork was the biggest down side for Sapa. “The documentation was always cumbersome. It’s just very heavy,” says Hans-Erik Trulsen. “We would have liked more guidance at that stage. Perhaps even more assistance in completing complex forms, or making them clearer.”
Getting hooked up to Connexis was also thought to be a heavy process, but with more than 120 users it was always going to be a challenge. “It almost became a bottleneck,” he recalls. “You need to get down to the details. It’s never a couple of PowerPoint slides and a free ride.”
“So I think that would be two things to take away for the bank.”
“BNP Paribas knows Sapa quite well now. It has been turning over stones, finding issues, problems, solving them. But in that process, you have reached a level of understanding and a knowledge of Sapa that will enable us to use the bank as a discussion partner, to discuss solutions, possibilities, options, and also to take it from a relationship-based cooperation to a more partnership cooperation. We can tap into the bank's resources and knowledge and experience, and so this is actually the foundation for future improved working together.”
“So, BNP Paribas is a valued strategic partner for our cash management business, which is a good thing, but it's also challenging. And we have high expectations.”