May 16, 2012 ERP Integration in a Changing Environment Industry Leading Practices
May 16, 2012
ERP Integration in a Changing Environment
Industry Leading Practices
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Introducing the Speakers
Bobby Carney
Bobby is the Global Product Head for Connectivity and Software-as-a-Service
at Citi. Mr. Carney has global product management responsibility for
Connectivity products, including CitiConnect and Citi STR, and Software-as-a-
Service offerings such as CitiDirect White-Label. Previously within Citi
Transaction Services, Bobby held EMEA regional product management
responsibility for Channel Services. Prior to joining Citi, Bobby was a
management and technology consultant with Accenture, focusing on design
and delivery of transformational change programs with Banking and
Insurance clients, and has further extensive experience in the international
telecomms industry.
René Schuurman
Rene is the Global Product Manager of Connectivity Services at Citi. Mr.
Schuurman has global product responsibility for all file and message based
connectivity solutions for Citi Transaction Services within Citi. These include
the use of EDI and messaging standards, ERP and TWS integration and the
use of SWIFT product and services. In this capacity Mr. Schuurman is also a
representative for Citi in EDI standard governing bodies such as the PAY
SEG and the Common Global Implementation workgroup. He is also an active
participant in the ISO20022 CGI Mapping Group.
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Agenda
ERP Integration – Trends & Developments
Bank Integration – Exploring Citi Solutions
Summary
Questions
ERP Integration – Trends & Developments
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Treasury Trends – Execution Imperatives for 2012+
Continued volatile market conditions and evolving
regulations require improved information and rapid
execution capabilities
Maintain financial flexibility with funding strategies
across multiple options
Leverage emerging technology/process standards to
increase flexibility and choice
Focus strategically and globally for
treasury transformation opportunities
Implement robust control processes to
monitor operational & financial risks
that may come with growth
Reassess banking relationships with a
view towards future growth strategies
and plans
Treasury challenged to do „more with less‟
Company-wide liquidity and risk management
programs are a key characteristic of industry
leading efficiency and effectiveness
“Piggyback” treasury objectives on organization-
wide technology/process initiatives to help drive
the business case
Close coordination with businesses, regions to
identify issues and mitigants
Implement policies, controls and ensure ability to
monitor
Long-term view of requirements across a broader
network
Rationalize providers to improve operating and cost
efficiency
Flexibility to respond to volatile market
conditions
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Evolution of the Working Capital Model
Global Treasury Integration
Global IHB
Global Treasury Centre with
Regional RTC
Global Risk Management
Global Liquidity Structure
Traditional (Local)
Business Model
Regional Treasury Integration
Regional Treasury Centre
Regional IHB
Regional Liquidity StructureGlobal Working Capital
Management
Global SSC
Global Vendor and Customer
Relationship Management
Global POBO Structures
Global Netting Centre
Global Payments Factory
Global Principal Trading
Company
Regional Working Capital
Integration
Regional SSC – process
centralization
Regional Vendor and
Customer Relationship
Management
POBO
Netting Centre
Payments Factory
De-C
entr
aliz
ed
Centr
aliz
ed
Local Management of
Treasury and Working Capital
Local cash management
Local Payables and
Receivables
Multiple Bank relationships
No centralization
No arbitrage of tax, FX, bid /
offer spread
Regional
Entrepreneur
ERP
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ERP – a timeline
1960s – Enterprise Resource Planning is born from a joint effort between J.I. Case and
IBM as Material Requirements Planning
1972 – SAP founded
1977 – JD Edwards and Oracle founded
1978 – The Baan Corporation founded
1987 – PeopleSoft founded
2003 – Services Oriented Architecture and “Internet Enabled” become standard
2003-2005 – Industry consolidation occurs*:
SAP – 45%
Oracle – 20% (E-Business Suite, JD Edwards, PeopleSoft, and Seibel)
Microsoft – 10% (Navision, Axapta, Great Plains, and Solomon)
Infor – 10% (Baan, Mapics, and a slew of other products)
Sage – 10% (Best Software is acquired)
* Forrester research
Virtually all companies (>99.5%*) with revenue of more than $5 million
have an ERP
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Survey Question 1
For what functions do you leverage your ERP system?
(Please choose one or if it‟s not listed choose “other” and fill in the blank)
a. Inventory management only
b. Payables
c. Receivables
d. Payables & Receivables
e. Payables & Receivables & Treasury
f. Other - NOTE: CAN DO MULTIPLE CHOICE ONLY. USERS CANNOT FILL IN THE BLANK.
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ERP Integration - Challenges
Challenges
Specialized Resources
– Build – ERP Integration a core
competency of your business
– Buy
– Partner
Cost
– On-going Maintenance fees
– Large up-front costs
– Unknown partner viability
Time Consuming
– Long implementation cycles
– Delayed realized ROI
Must interpret country specific rules, payment
types, specifications
Rewards
Automation
– Remove human intervention
– Increase process efficiency / STP rates
Accuracy
– Reduced errors by eliminating manual
processes
Reduced Risk
– Less “hands in the pot” and potential failure
touch points
Lower TCO
– Human factor costs
Scalable for future growth
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State of Play
SAP Oracle Infor Microsoft
Standard format Idoc Prefer EDIFACT N/A N/A
Standard data
setN/A N/A N/A N/A
Integration
softwareNetWeaver Fusion N/A BizTalk
Standard
protocolN/A N/A N/A N/A
Standard
security solutionN/A N/A N/A N/A
Bank Integration – Exploring Citi Solutions
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How do I ensure my payments are
protected during delivery?Security
How should I deliver the payment? Connectivity
What language should my systems speak
with the bank‟s systems?Format
What payment types do I need to make?
What specific information is needed for STP?
Validated Data
Bank Integration
Connecting to your bank can be a challenge. Even more so if you want an integrated / fully
automated solution.
Business Considerations Integration Challenges
While the banking community – including SWIFT – has delivered tools to simplify connectivity and security
Corporates want their banks to walk more than the last mile …
Validated Data
Format
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An example: Citi‟s solution for SAP
Designed to walk more than the last mile by addressing Data and Format challenges for ERP Users.
The CitiConnect ERP Integrator
Validated Data
Format
Provides a cost-effective and non-intrusive
solution for SAP
Leverages existing ERP / SAP capabilities to
extract comprehensively populated payment
files at no extra cost
Delivers payments (and direct debits)
formatted in ISO 20022 XML with all required
payment details, including local clearing rules,
for straight through processing by Citi
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The CitiConnect ERP Integrator
Allows Corporates to generate files in ISO XML format with validated data in 3 steps:
1. Load the Citi ISO XML Template into the SAP Payment Medium Workbench and optionally customize
2. Assign the template as a payment method
3. Associate payment types to vendor Then it‟s business as usual
About SAP Payment Medium Workbench
An integrated and strategic component of each SAP ERP (version 4.7 onwards) at no additional license cost
Payment File
SAP ERP
SAP Payment
Medium
WorkbenchCiti ISO XML
Template
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Survey Question 2
Are you using a service bureau for your payment transaction processing?
a. No
b. We are considering/evaluating
c. Only for Treasury payments
d. For both Treasury payments and Payables/Receivables
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Co-Innovation
Citi and other banks have agreed to co-innovate in SAP Financial Services Network
The objective is to create a modular and expandable ecosystem connecting corporate users and their banks
Corporate users and banks encouraged to join the Customer Engagement Initiative to review, collaborate and contribute to the SAP Financial Services Network
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Introducing SAP Financial Services Network
Banks Corporates
SAP Cloud
Secured Connectivity
Financial Services Network
Pa
ym
en
ts
Rem
ittan
ce
da
ta
Tra
de
fina
nc
ing
An
aly
tics
Value-added Services
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Next Generation Corporate Connectivity
Banks Corporates
Comprehensive Solution:
Single connection, multi-service network – payments, trade financing, liquidity management, etc.
Platform for value-added applications, e.g. intelligent decision making, automation, etc.
Cloud-based for low TCO, rapid on-boarding
Value ServicesBusiness Network Directory
Integration as a
Service
Platform as a Service
Data store
SAP Cloud
SAP Financial Services Network
Summary
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Value Proposition
Cost Effective
Leverages existing ERP/SAP capabilities to extract payment files at no extra license cost
Flexible
All ISO 20022 XML payment types in Citi‟s global footprint supported though STP
Phased roll-outs supported
All CitiConnect protocols supported
All CitiConnect data security solutions supported
Fast and Simple
Significantly shortens implementation process: days instead of months
User configured, not programmed
Adaptable
Easily adaptable to existing ERP customizations
Co-exists with other bank interface solutions
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Survey Question 3
How confident are you in your IT/IS/Technology department in developing an integration solution to your
bank under the following conditions:
• Low cost project under $75,000
• Scalable enough to fit your entire foot print
• Fast implementation time <60 days
• Accurate interpretation of banking rules by country and payment type (possibly 100‟s of
combinations)
a. 100%
b. 75%
c. 50%
d. 25%, or less
e. Unknown
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Conclusion
ERP systems continue to enhance and develop their capabilities, including new developments on bank
integration
Integration with banks continues to be an area of complexity and focus
Citi continues to develop solutions to address this functional gap, with an emphasis on collaboration with
ERP vendors, to deliver against the client imperatives of:
Efficiency and effectiveness, doing „more with less‟
Flexibility
Control
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Questions
Thank you for your time today
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Bobby Carney
Citibank – CTS
Global Head of Connectivity and Integration
+353 (1) 622-6019
René Schuurman
Citibank - CTS
Global Product Manager, Connectivity Services
+1 312 876 3383
Thank you
efficiency, renewable energy & mitigation
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issue of climate change by: (a) targeting $50 billion over 10 years to address global climate change: includes significant increases in investment and financing of alternative energy, clean technology, and other carbon-
emission reduction activities; (b) committing to reduce GHG emissions of all Citi owned and leased properties around the world by 10% by 2011; (c) purchasing more than 52,000 MWh of green (carbon neutral) power
for our operations in 2006; (d) creating Sustainable Development Investments (SDI) that makes private equity investments in renewable energy and clean technologies; (e) providing lending and investing services to
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Citi works with its clients in greenhouse gas intensive industries to evaluate emerging risks from climate change and, where appropriate, to mitigate those risks.
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