Repositioning Treasury as a Business Partner

SAP head of treasury Jörg Wiemer diversified the software company’s funding sources, improved working capital management.

During the finaSAP's Jörg Wiemer ncial crisis, many began to see treasury as a more strategic function than in the past. But for Jörg Wiemer, who has been with software giant SAP since 2005, this was old news. Wiemer is head of global treasury, senior vice president and a member of SAP’s Top 100 global leadership team. Having decided five years ago to reposition treasury within the organization, Wiemer says that today, the “high performing treasury team is a business partner, a value-adding change agent and thought leader.”
 
What does this mean in practice? “Treasury is a business partner not only for board members, but also for the subsidiaries, which are our internal customers,” Wiemer says. “In other words, we help them in all aspects of financial risk management and financial asset management.
 
“The thought leadership element is linked to the role the SAP treasury plays in showcasing the company’s own treasury products,” he adds. “It’s important to have the right image in the treasury community as an innovative team with efficient and effective processes. And of course we influence our developers, so we need to make sure our ideas find their way into SAP treasury products.”
 
Wiemer, who’s based at the company’s headquarters in Walldorf, Germany, has led a number of ambitious projects over the past couple of years. A succession of refinancing transactions—including two very successful U.S. private placements, two refinancings of a 1.5 billion euro syndicated credit facility, the financing for two acquisitions, one for 4.8 billion euros and another for 2.75 billion euros, and several corporate bond transactions, including SAP’s debut bond issue and a German “schuldschein” private placement—enabled the company to diversify its funding sources, even though it doesn’t possess a credit rating.
 
Wiemer attributes the success of the transactions to SAP’s strong business and financial profile: “In tough times, you see a strong demand for high-quality credits.”
 
Meanwhile, he has also been leading an ambitious working capital management optimization project. In addition to pursuing such strategies as improving DSO and DPO, this project set out to increase awareness of working capital management throughout SAP, an effort that included introducing working capital-related bonuses for all employees worldwide. A working capital dashboard was set up to make working capital transparent for SAP’s different legal entities and facilitate benchmarking. The working capital project also focused on customer financing, customer credit management and the billing process. Wiemer and his team have also done several treasury post-merger integrations, developed and executed a new share buyback strategy, and established a new foreign exchange hedging approach.
 
Despite all these achievements, Wiemer is not resting on his laurels. SAP, which has a headcount of 53,500 and turned over 12.5 billion euros ($17.1 billion) in 2010, is a company with ambitious growth targets, which the treasury has to keep up with.
 
“The challenge is to deliver services of the same high quality with the same number of treasury staff, despite increasing business volumes over the coming years,” he says.
 
How will this be achieved? Further automation and standardization is the key—not just for treasury processes but across all cash cycles.
 
“There is a nice opportunity for treasury to help the company grow and be more efficient and effective,” Wiemer concludes. “As a consequence, over the coming years treasury will not just be focusing on financial asset and risk management—we will also need to further intensify our collaboration with colleagues in shared service centers and lines of business in order to optimize, standardize and automate especially the order-to-cash and purchase-to-pay cycles while running our own SAP software.”

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