The optimal solution is to stay with SAP and that is my choice
Jan van Trigt, Treasury Controller, ICI Group

ICI was SAPs first ever Customer in Germany in 1972. It is a testament to their strong customer loyalty that decades later (equivalent to several lifetimes in the software industry), they are still with SAP and are still embracing our solutions. SAP UKs Customer Marketing Manager, Sarah Hampson, met up with Jan van Trigt, the Treasury Controller for the ICI Group at their headquarters in London recently to ask Jan how ICI is benefiting from SAP Financials, in particular SAP Treasury. Jan van Trigt is responsible for the administration, accounting and IT services over ICI Treasurys global finance companies. He is based in London but his team manage 35 finance companies within the ICI Group that are located in the UK, US, Europe and Asia.

ICI is one of the worlds leading specialty chemical companies and was in history one of the first major chemical companies to be established. At one time ICI has employed about 200,000 employees in the world. About ten years ago, it was decided to split the company into two parts the pharmaceuticals part (this was then called Zeneca and it now known as Astra Zeneca, a successful company in its own right) and the bulk chemicals part (this remained under ICI). ICI acquired the complete Unilever chemicals division about four years ago. After this acquisition, ICIs strategy was to divest the other bulk chemicals companies from ICI, whilst keeping the paints chemicals one of the leading paints companies in the world. Now the companies that remain part of ICI include the paints companies, for example, Dulux, the well-known world-leader, National Starch, the world leader in starches and Quest International, known as a supplier of fragrances to major fashion houses and the performance chemical business. The ICI Group has now only 54,000 employees, yet still has 250 companies that are a lot smaller and much more profitable.

Over the years, the relationship between ICI and SAP has grown and flourished from the days of SAP R/2 through to SAP R/3 and to the present day. Weve now reached the era of the new, new Economy where the focus is back on profits. SAP Financials delivers the tools and automated processes that empower the finance function for this economy. It also provides the solutions and tools to help companies such as ICI to operate in a profitable way and participating in generating long-term value for investors and stakeholders, by enabling collaboration and reducing transaction costs. SAP Financials can also improve business performance and corporate management by using new management processes and analytical applications. The ICI success story very much focuses on the benefits that SAP Treasury (part of the SAP Financial solution) brings to their organization.

Jan van Trigt began by explaining the situation at ICI before they implemented SAP Treasury: We already had a treasury system. We had developed this system ourselves in-house. We realized that we became too dependent on the people who developed it and to adapt the system to best practices. These people left or were leaving the company. Second, it was not millennium proof. So there was a sense of urgency to replace it. Together with PWC, we made a request for a proposal based upon our Treasury business requirements. but then the Unilever chemicals division acquisition came a year later so we had to park the project to give ourselves time to reinvent the Treasury strategy and policies based upon the new company structure. Based upon this new business requirement after the acquisition, we started a new supplier evaluation. We reviewed other treasury package suppliers and benchmarked SAP against them. We noticed that in this one-year period SAP had caught up with fulfilling our requirements and SAPs solution satisfied our requirements to about 75-80%. This is a high score as we wanted to go with a standard package and you know whatever you do you will never get a 100% solution by keeping its standard, avoiding complicated upgrades, but you can come close to it specifying your wishes to the SAP development team, integrating good ideas in future releases. One of the main reasons why we selected SAP was also the reputation and reliability of the supplier. We wanted to have a reliable partner we knew would be there as a winner in 10 years time. We have known SAP for a long time as ICI was SAPs first customer in Germany.

Another important issue that led ICI to choose SAPs Treasury solution was the issue of security. As it is a treasury cash environment authorizations, security and segregation of duties are critical. With Treasury, you must have strong controls and authorization levels. Jan van Trigt: One of the main criteria when we went for system selection was if the ICI internal audit criteria were met, especially on security. A lot of the other packages were not so strong in that area. Security was essential. Audit trail was essential. Controls were essential. ICI also chose SAP Treasury for the integration and interface with their system capability, and began the process of implementation.

Before they started the implementation project, ICI formed a Treasury System Steering Committee in which they define the current and future strategies for their Treasury system. It is run by ICI with the Group Treasurer as Chairman and Jan as the Secretary. SAP is also represented on the Committee by George Smith, SAP UK Senior Consultant for Financials/Treasury. George has been involved with ICI right from the beginning of the project. When ICI first formed the project team, they sent all the project team members to the SAP Education Center at Heathrow to attend all the required courses and George Smith was their trainer for the SAP Treasury course.

Jan van Trigt: The project started in March 1998 and we went live by the 1 st January 1999. We had agreement both in the Systems Steering Committee and in the project team that there was to be participation from both SAP and PWC Treasury Specialists. We decided that was the best team for success. In fact, George Smith from SAP is still working very closely with ICI. Jan van Trigt sums up this relationship: George Smith has been a great help for us since the start of the project. Three years later, he is still involved. He is still a primary consultant to ICI Treasury but also he can give us updates on the most recent developments in SAP Treasury product development in Germany. He acts as an advisor as well as a business consultant. George also gets involved in configuration so he is really a man of all skills he is great.

ICI went live with R/3 Release 4.0B using some additional banking functionality from R/3 Release 4.5. (They have since upgraded to 4.6C). Jan van Trigt explained that it was an extensive scope: We had SAP FI - the Finance module for a number of UK finance companies within ICI. We used Cash Management for the bank statements. We have not used Forecasting as yet. We use the TR module Treasury and Market Risk Management. Within TR Treasury we then implemented a variety of financing instruments, such as Money Markets, FX, Derivatives, Securities, Loans - that was a big scope!

Jan explains that they work in a unique environment: Treasury is a highly specialized organization so an implementation within a Treasury environment is quite complex as we use these instruments and within these instruments you have more variables. In order to implement them you also require, beside the SAP skills, excellent treasury skills in order to do this. The people who use SAP Treasury are experts in their own field. Jan gives examples of the users who the solution was rolled out to: We have here a Market Risk Manager who deals with the market risk assets of all our aligned companies. We have a Development Manager who deals with financing products and who is also involved in setting up the value and risk market model as a separate part of SAP Treasury and the ongoing global cash management. We have dealers using the SAP system, back-office settlements and accountants, back-office specialist treasury accountants. The accountants like the system as it provides them with much more functionality that the old in-house system and they participate in setting up the accountancy rules for their instruments avoiding errors later. Do it right first time.

As well as satisfying the requirements of demanding users, the SAP Treasury solution also had to have interfacing capability. As Jan van Trigt explains: What is important also is the interface capability of SAP to our third party data providers. Third party data providers are use, for example, for the latest currency information. They provide a real-time feed. It is also important that SAPs Treasury solution can provide an interface to the five different banks that ICI deals with, has links to global bank information and has an automated link to the companies consolidation system.

What are the main benefits that ICI gained from implementing SAP Treasury? Jan van Trigt: Having the SAP platform in place, it gives us the flexibility to concentrate on specific tasks. For example, in the accounting we can build up a critical mass for certain tasks at a certain treasury location, therefore gaining efficiency in both business processes and resource, by using SAP. SAP also gives ICI the possibility to listen to the changes that we have in the company. The business need has changed and we believe that SAP can accommodate these changes. And what SAP has achieved of course is gaining stability and control of the treasury practice.

So now that SAP Treasury has been successfully implemented in the UK, what are ICIs plans to rollout the solution out further? Jan van Trigt: we have opportunities to roll SAP Treasury out to our other finance companies in the world. The second rollout is to our other SAP users in the businesses. This is part of an ongoing rollout. As you will see that in the newly acquired businesses they are also in the process of implementing SAP. So at that time, we couldnt make the direct link. We first had to implement SAP Treasury in the headquarters and let the new businesses finish their implementations. The ongoing rollout involves a lot of companies approx. 50 companies are involved. The idea is to link their SAP Cash Management System to our SAP Treasury system. We want to streamline our business processes in order to gain efficiencies.

What are Jan van Trigts plans to extend on his investment in SAP Financials? We are investigating the use of SAP CFM (Corporate Finance Management) that gives us the In-House Banking solution, Liquidity Planner, Portfolio Analyzer. SAP CFM will give the operational treasury people much more functionality. We also need to look at the FAS 133 accounting standard in the US. One of the key drivers to move to CFM is FAS 133 functionality that is contained in SAP CFM.

What is Jan van Trigts opinion on the SAP e-business solutions that form SAP.com? We are now reviewing the new initiatives relating to E-commerce, Business Information Warehouse, Marketplace and the Workplace. This is a very interesting environment. I believe that the SAP e-commerce initiatives such as Workplace and Marketplace are very good initiatives. Certainly the Workplace environment is a good one as that involves the streamlining of the internal business processes and it is role-based as well.

If Jan van Trigt had one piece of advise for other SAP Customers considering implementing SAP Treasury what would that be? Jan: The SAP Treasury world is a community we know who to talk to in Germany and in the UK. We have been able to have direct access to developers when we have been doing cutting edge work. SAP UK Consulting provides the continuity and has the growing knowledge and a broader team. The optimal solution is to stay with SAP and that is my choice.

And finally if that is not enough to convince you, ICI is a reference customer for SAP on their SAP Treasury solution. They would welcome a visit.