How to Implement a Treasury Management System with Bart Hendriks

Foreign.

Welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. Each and every week I talk to them about how they've built their careers, where they are now, where they see both themselves and the treasury profession. Going to next. Let's get on with the show.

This week's show, delighted to be joined by Bart Hendricks, the head of global treasury operations and in house bank at SIVA Logistics. SIVA Logistics, world class supply chain solutions for large and mid sized multinational companies across the globe. Industry leader, supply chain, design, contract logistics, right the way through. But basically in terms of size, over a thousand facilities, 170 countries, 110,000 employees. But again, Bart will explain a little bit more about the group later on in the show. Then we'll talk about some of the other passions he's got. But we're going to go right back to the beginning a couple of years ago now to when Bart first started in corporate banking, how you discovered then the world of Treasury. Bart, as always, I'll hand the show over to you, sir. Take us back to the dim distant past. Over to you, sir.

Well, thank you Mike and thank you for having me. Well, we have to go quite a long way back when I started my career after university. So I started my career in banking, indeed worked in corporate banking, leveraged finance across Europe with different banks, mainly with one of the largest Belgian banks. I was located in the UK in Ireland, in Paris. So I got quite some exposure to international business and international corporate banking at an early start, the start of my career, I was at the early 30s, well end of my 20s, I was living outside of the Netherlands, exploring the world of corporate banking, which to me I didn't have a finance background in university was a steep learning curve, but it was very useful and I must say I had a great time there.

I'm going to jump in, I'm going to ask was that deliberate choice? So did you, when you were finishing your, your degree and coming out of university, were you thinking, right, corporate banking, that's the route for me, for the, you know, the future of my career. People will understand why in a moment because obviously you, and again, you and I know this, but made a slight, a slight turn in the fork in the road, a bit of a change in a minute. But was that something you thought, yeah, banking's for me forever or what happened?

No, actually it wasn't. So I did my economics degree at the University of Maastricht. It's a very, very general study and at the time and this is 1996, 1997. The job market was quite tense and it was difficult to actually get in. And I went for a traineeship with one of the Dutch private banks and I got in and I actually rolled into banking like that. I quickly discovered that private banking was not for me and I wanted to explore my and expand my horizons and that's why I moved to international corporate banking. But it wasn't from the outset my main objective to go into banking. No, no. But very happy I did by the way.

And then you did the corporate banking for a while. Join being with the clients and things. What happened there?

Well, after 12 years in banking I was like, indeed, what's next? So I wanted to move back to the Netherlands. I was at that time and so we're talking about 2005, 2006, I was moving back to the Netherlands, married, three children. And I want to do something completely different. So. So I actually became one of yours actually Mike, because I went into recruitment and I was a corporate recruiter for at least working for a recruitment company for two and a half years, finding right candidates for finance positions. So it was a great opportunity. It was the most commercial position I ever had because I was responsible for getting new clients up to credit management. So huge opportunity, great experience. But after two and a half years I wanted to move back into banking, slash treasury. And so I ended up in my first corporate treasury experience which was with a spin off of Texaco.

And you made that move from recruitment to that. Was that just a drive for you or, you know, why did you make the move?

I enjoyed working as a recruiter. You meet a lot of candidates, a lot of people, a lot of businesses. But I did find out that recruitment was not for me for the long term. I didn't want to waste my experience in corporate banking, but I knew that the banking environment, the banking world, I've been there, I did it and I wanted to explore something new. And when I was approached to actually apply for a position for a Benelux treasurer for this spinoff of Texaco, it was with an Israeli company called Delec. I jumped on it. I actually never looked back because, and this is over 12 years ago and I must say I really found my niche in the corporate treasury with that role.

It was a spin off, was it startup in that sense?

Well, the thing was, and I think I was very, very lucky to join the corporate treasury community in this position because yes, it was a kind of spinoff because of the fact that it was a carve out out of Chevron, which actually meant we were inheriting a bank account structure, a financing at the time with Lehman Brothers. So also very exciting. But the treasury in fact stayed with chevron in the U.S. so there was no Treasury Department. So I had the opportunity to set it up, but it was already a business of, I think we had a revenues of about 4 billion US dollar revenues when I started. So the business was comprised of all the Texaco gas stations in the Benelux and that's about. And 950 at the time.

Yeah.

So huge business, very complex, a lot of FX business, a lot of bank accounts as well for each of the gas stations had their own bank account at the beginning. So a lot of work for a relatively young, ambitious treasurer. And also the fact that I could set up my own team, which was an experience as well, the first time I actually did that in my life.

And when you did that role, can you describe business per se? Because as you and I have talked about this before, that although it was the gas stations and things like that, was it related into oil and gas or was more retail or.

It's more retail, it's fuel retail. So on the one hand, yes, we are of course impacted by the commodity world. We were buying our fuels from every provider which was there. It could be be Texaco, but it could also be Shell Trafigura, it could be everything. So we had a commodity component there which needed to be hedged, but also a very strong FX component because we were buying our fuels in US dollars and selling them in Euros. So really, Mike, when I started there was nothing there. So we went for trading platforms, we went for a Treasury management system, we went for a cash zero balancing notional pooling. We did everything. Great fun.

And when you did that, we talk in a lot of the shows about having a checklist as starting point. Now it was slightly more mature starting, but sometimes they're like, well, we don't know what treasury was, whereas. So they've handed you on a mature group who had had a Treasury. But then it's like, right, your own Treasury. Did you take direction from above or did you have your own to do everything?

Well, Chevron was out of the picture. They sold it to this Israeli conglomerate which had their own finance, global finance department centralized in Israel. They did leave us quite on ourselves. So we started very basic in defining a Treasury policy and building on this policy. We went to write down the processes and then in the end looked at the tooling we needed for this. And luckily I was supported by I think one of the best CFOs I've ever had. And she was very constructive, very supportive. And this was the biggest change for me compared to banking. It was when I thought about, for example, a trading platform which we didn't have at the beginning, I went to my CFO and instead of saying, well, can you write a business case and then we will have a look. Her response was, why didn't you do this before? Just get it done and do it. And that was completely different than working for banks where if you had a, an idea it had to go through four or five layers and then you never knew where it would end up. This was very to the point and very, I mean very dynamic. It was great to work in an environment like that.

And then you made the move came next.

Exactly. So being infected by corporate treasury at the time, I spent just over three years with Delec and then at least this part of Delec and then our Israeli shareholder decided to put it up for sale. As a result, the fast and rapid development we had came to a standstill. Well, at that time I knew somewhat about corporate treasury, but I wanted to learn from the best and one of the best treasury teams in the Netherlands at the time, and I think it still is, one of the best treasury teams is with a company called Friesland Campina, which is one of the largest, I think it's the fourth largest dairy cooperative in the world with a very mature, top in class, best in class treasury team. I was asked to join as a senior treasury manager reporting to the corporate treasurer. His name is Klaas Springer. He had already 20 years under his belt as corporate treasurer. One of the best treasurers I know. And I had the opportunity to learn from him for over two and a half years and also had the opportunity to travel and especially I spent most of my time in Asia, which was one of the most important export markets of Friesland Campina.

And if you listeners now want to listen to a lovely interview with the lovely class Springer, you go Back to episode 154, we'll put it in the show notes. In fact, I was looking up whilst we were there because I remembered that as well and that was great. You learned a lot. And he gave us a really good insight to the group and his progression there. But you were there for a few years before then you sort of continued to grow. Now this is one of the reasons I got you on the show because you made those moves. Lots of listeners. All right, okay, what did he do next? What did. Then you did that you learned that you brought a new experience. Talk us through the next move.

So they made a couple of years with Fiesland Campina, but I missed having my own shop, having my own team and responsible for a Treasury team. At that time I was approached by Q Park, which was a bit in the pickle as to they were struggling a little bit with their banking group. They needed to be refinanced. I just did the refinancing for Friesland Campina, so I had some experience there. They needed to refinance, they needed to build trust again with their bankers, with their investors. They also needed to make the change from a real estate company to a more retail oriented company because they realized that for a parking company like Q Park, in the end they make money on you and me, the people who park their car. So it is a kind of retail and it's not property, it's also property. But they wanted to make the change, the cultural change to a more retail focused company. A new CEO came in who had a lot of experience in the retail environment. They and he wanted the treasurer with also retail experience. I joined him and my first job was to relocate the finance team from Brussels to still staying in Belgium, but very near Maastricht, which was the head office of Q Park. As a result, we had to build a new team because not all people joined us and we needed to start working on the refinancing which was at the time a hell of a job because like I said, we had to gain trust or rebuild trust with our banking group. We were highly leveraged at the time, so it was great for me to use the experience both on the retail market with the Texaco, but also my experience with Friesland Campina on debt, capital markets and also on the financing side. So it all came together there and.

You built your experience, you carried on and developed it and then took us through my deck and some of the others.

I strongly believe that you can have a career where you start out as a junior cash analyst and end up as a group treasurer. I like to build my career on experiences and more, have a portfolio of different careers. So at the point QPark was put up for sale and was bought by KKR the capital, the I company. It was a natural moment for me to leave the company. So I did work quite hard on the vendor due diligence and the sales side. But then it was time for me to move on and I was approached by a friendly banker from Singapore who said, I have a Japanese client, not that well known in Europe yet. However, it's making a lot of acquisitions in Europe and they want to have a European treasury hub from the Netherlands. Are you interested? And this again, it's like a greenfield setup. So no one was there. I was there with four Japanese expats in one small room in the World Trade center near Amsterdam. And we started from scratch. Even though we did have about 90 different companies in Europe which we had to align and we had to centralize. And that was nice. That was really nice. It's a totally different culture. I'd never worked with Japanese companies before. Also there we have a learning curve, both sides. But we had a very open minded chairman for Europe and he gave me all the room I needed to build a Treasury team and also a cash management structure which was aligned with corporate guidelines from Kyoto at the time.

Okay, can you describe the group for us? Just because I wanted to then bit more about the challenges you face within the treasury function itself. Because again, when I have talked about this and this is for the listeners, they're like, oh, okay. Who are they? You know.

Yeah, no, no, actually, absolutely. So NIDEC is world leader in electrical motors. That means it's a listed company, billion dollar company. It has a global Presence also over 100,000 employees, still very much controlled and managed by the founder and chairman, Mr. Nagamori. They did some big acquisitions both in Italy, France, but also in Germany. They are active. If you drive a car, Mike, you have your power steering, that's an engine made by nedec. If you have your brakes, they're operated also with engines made by nedec. Your air conditioning in the car. So their equipment is everywhere around you, even in the elevators or sliding doors or everywhere. But no one knows the brand. But it's, it's a big brand in the B2B market with regards to electrical engines.

Very similar. As we've had interviews with the guys at Johnson Controls and things. When you talk to the people, we go, well, you know that bit? No, I don't do that. We do that bit. And then they do that and you're like, okay, so it's not all under, you know, they all come from the supply chain. It's just incredible. So.

No, no, absolutely. And one of the things I was responsible for as well is next to setting up a cash management structure, we also issued the first euro bond for the group. So they, in the past they did everything with yen. So they had a lot of debt. Capital market transactions in Japan itself. During my stay there, we also did a euro bond which was great to be part of that. I was also responsible for supply chain finance for Working Capital Management, actually. And we implemented a reverse factoring program in Europe, which was also something completely new for the group. Also a product which was not known to our head office in Kyoto, but they were very amazed by the results. And we had great support from the issuing bank. It was also one of these projects. It's a one in a lifetime, once in a lifetime that you actually are able to set something up from scratch. It was a three year assignment. I stayed there two and a half years. And then my successor, and I think he was on your show as well, Stephen Harper. He took over after and a half years, like I said.

Yeah. And he's at Tava Pharmaceuticals now and.

Exactly.

We'll put some of the links to some of these guys in the show notes for you guys listening today. But you've done that assignment per se and then an even broader role. I mean, you couldn't get much broader, but you did keep going.

So I found out that I like these projects. I like working on setting up Treasuries, advising Treasuries, working with different Treasuries. So I took a turn in my career and I joined Orchard Finance, which is one of the leading treasury advisory firms in the Netherlands. And I joined them in their treasury and corporate finance department to support other companies in the development of their treasury function. So I was responsible for strategy and organization and risk management. I worked there for over almost three years, working on different projects supporting Treasuries across the Netherlands, but also in the Nordics, which was great to do as well.

And that role itself, you for nearly three years. Yeah. You were looking at lots of different Treasuries. And you and I spoke about this in the past, but you saw some very strong Treasuries and perhaps some needed some more assistance, should we say, what were the big things that you saw that you thought, wow, these guys need to sort that out, or the flip side, you were thinking, these guys have really got it right.

So I think my experience is, and I want to be very generalistic, but companies who grow very fast and who grow their Treasury Department also quite fast, they sometimes lack some of the basics. And what I mean with that is that these companies, even though they have a Treasury Department and already experienced treasury people on board, they miss a certain strategy or they miss policies. So they start implementing treasury management systems, they start hedging their exposures. But what they lack is the foundation. I think that's key in any Treasury Department or any Treasury Function is that you start with the basics and that is determining your scope, determining your policies. And based on these policies, you develop processes, you look for tools to support you. There's. And that's the way you should set up a Treasury team and not just start in the middle and think at a certain moment in time, wow, why don't we get a Treasury management system? No, a Treasury management system should be supporting your treasury policies and your treasury strategy and not the other way around. That you start with a Treasury management system because everybody else is saying you should have one if you don't even have a policy in place. To give you an example, I worked very closely with the fintech company Vinted and I had the opportunity to define with their corporate treasurer their policies first, their strategy. And based on that, we worked on their FX strategies, their hedging strategies, and in the end we selected also a suitable treasury management system which actually was equipped or aligned with their future growth strategies. So that was fun to do and I think that was a lesson for me as well. First, get the basics right before you jump into all kinds of new developments with APIs and with treasury management systems and all kinds of fintech tools.

And when you were doing that, just going into that. Barb.

Yeah.

How did you do what I mean by that? Just qualify that question is, did you sit down with vintage and things that. Right. What. What is it you need? What is it you want at the end? Do you want cash clarity? Do you want fully, you know, hedged or risk or what are the sort of end goals, would you say?

It starts not only with treasury, it starts with defining the stakeholders, which also includes not only treasury, but the CFO is involved, the CEO is involved, audit is involved, the accounting is involved. And based on that you define, okay, what are the key processes where treasury should be responsible for? It's defining your risk appetite. You need the executive layer to have a strong say in that because in the end they define what kind of risk the company is willing to take or not. You talk with the accounting department because they need the data you are providing, so what type of data they would like to see from Treasury. So it's working with different functions, just looking outside of treasury and talk to the other functions. You talk to tax because you are working on cash pooling. So you need to define your transfer pricing policy. So in the end you want to have a comprehensive treasury department which is actually part of the company and not just standalone, in an ivory tower.

Have this broad role. Yeah. With Orchard. Yeah. Talk us through Because I don't want to run out of time with joining.

Siva, like I said, stayed for almost three years with Orchard Finance, worked on many interesting projects. But I'm a corporate treasurer, Mike, I'm not a consultant. I wanted to get my feet dirty, I wanted hands dirty. I wanted to be part of the organization and not just giving advice, but also following through, taking responsibility and building something from scratch again within the organization instead of from an outside in role. And when I was approached a year ago by actually your team for this role at Siva, it was going back to an environment I knew because it was corporate Treasury. But on the other hand it, I knew it would be challenging because at Siva, it's, it's a very new team. SIVA was of course acquired a couple of years ago by one of the largest French family owned businesses, cma. Cgm, container business, shipping business, acquired Ceva and relocated their head office to Marseille, from the Netherlands to Marseille. Which meant that they had to set up a completely new treasury team. They implemented the new treasury management system. So a lot of things going on, but like you said at the beginning, it's a very mature business. We're in over 160 countries, we are with over 100,000 employees. It's huge. So I knew it would be a great challenge, a steep learning curve because I was, I didn't know much about logistics before I joined the company, but it paid off because I'm really having a great time at Siva.

You walked in, you're setting up treasury again. It's a mature treasury. We know this and things like that, but what difference can you make?

What they needed was someone with a broad experience, a global experience, and also someone who could set up an international team. And when I joined, my team consisted of one person. Today it's 10 and they're growing every month. So the business is growing. So when I joined Siva, I was doing about 7 billion in revenues in 2020. This year, 2022, we will probably do 17 billion. So we almost tripled in size. And that is because we did three major acquisitions in a very short time this year. And my role is to integrate these different treasury operations from the acquired business into one team. So that treasury operation runs as a team in that way, also optimizing the processes through CEVA and the acquired companies.

And bart. When you seeing growth as a treasurer, this is tremendous growth standing still. What are the other things that you're thinking? Are you having to constantly work with your banks or is it work internally or whatever? What are you thinking is, you know, top of mind.

My main challenge is, is finding the right people. We acquired through a carve out, which meant, means that we didn't buy any treasury departments. So we need good people. We don't need the typical cash manager we used to hire 10 years ago. We have evolved and the business is more complex and we rely much more on data. We need a different type of people and we are of course a global company. Our main location is Marseille. We need to attract the talent available in Marseille and that's a challenge. That really is a challenge.

Why would, why would you say just because the world has changed in the.

Past few years or I think that a lot of treasury departments nowadays are looking, are fishing in the same pond. What I try to say is that we all need these young, bright people who know more than cash pooling, they know how to deal with data. We need data scientists and we need to persuade them to join an old fashioned Treasury Department. And that is one of my key roles at the moment, is trying to sell my company, sell siva to this group of people who we want to attract and join our team. And it's difficult because they don't know treasury and they have an old fashioned image of treasury that we sit behind computers transferring cash and it's much more than this nowadays.

Yeah, that's the starting point, not the end point.

Exactly, exactly.

So we spoke before the show and I know that you've also got some other passions which I didn't want to lose out on you. And again, we'll put in the show notes for people go to Corporate Treasury 101. We work with the guys. I connected with these two guys, Galom and Hassam and I told Bar about this. We've done this. They've done an ebook which helps you if you're in the early stages of your careers and this is a great thing to share. But then that also brought out with Bart that he. You love to lecture as well and you try and give back like Severin Le Blevinek and you, you tell us about you and why is lecturing such a passion for you?

Absolutely. So when I joined Orchard Finance, my key responsibilities was to. I became responsible for one of the six modules in a postgraduate course given at the University of Amsterdam in corporate finance and treasury management. Like I said, I'm responsible for one of the six modules. It's a postgraduate course, it's like cpa, but then for treasurers in the Netherlands, it's a two year program for treasury professionals. With at least five to ten years of experience. And I lecture in treasury organization and treasury management, which is a great thing to do because I get to share the knowledge I build up over the and my experience over the last 20 years in both banking and corporate Treasury. But on the other hand, I get the input of very smart people, young people within the treasury community who take part in this program and the discussions we have and views they have on, not only on new developments and AI or RPAs or blockchain, but also the way of thinking and for example, looking at how can we as treasury impact the social agenda of companies and what's our role there in the whole ESG story, not only on financing, but as a department itself. It's really enlightening to be part of this program and I've been doing it now for three years and I love to do it.

What's the biggest highlight for you on that? When you look at some of the things or when you talk to people about it, just like you've done there. But now I could say why. We know you and I have discussed why. What is so thrilling about it?

It's the energy and the vision. These people who haven't been in treasury for 30 years, but only for a couple of years, they bring a different vision. They look much more at efficiency, they look more treasury more as a process which can be optimized. For them, it's very natural to use systems the way they should be used. So for them, a Treasury management system is not something new and exciting. For them, it's the only way to move forward. They use data in a different way. They try to really use data and not only use it for treasury purposes, but also use data for other departments. Looking at your payables, your receivables, these kind of things, they play a much more important role there.

The other thing we were going to touch on is your recruiting policy and your recruitment policy is so open. And this is something that people, you, you talked to me before the show that it's not necessarily a deliberate choice, but talk about you are recruiting. What are you looking for?

The most important thing, I look for a spark. People need to be enthusiastic, full of energy and they need to be able to work in an environment which is multicultural. Like I said, when I joined, we were a team, two people, Rob, who's from the UK and myself. Today we're with 10 people and we have 10 different nationalities. The people in the team are either located across the globe, so we have people in the US in Singapore and China and Brazil, they should be open and be able to work in an environment like that. So being a multinational company with head office in Marseille doesn't mean you have to speak French. Actually, I think only a small part of my team really speaks French. You have to speak English, that should be perfect. But on the other hand, you have to have an open mind and be able to work in a multicultural environment.

We're reaching the end of the show. We're not quite there yet, so we're going to put your LinkedIn details in the show Notes bar and I know that we'll put some of the other links, some of the other connections we've talked about there. But as we wrap up today's show, I mean, you've given so many value bombs as we went all the way through, because you've got a passion for Treasury. It makes my life a lot easier. Talk to treasurers and they're sort of watching their words and thinking about this with you. It's just, you know, I've sort of sat back in my chair and I've, I've listened along with a lot of listeners today, which in a very positive way is really great. You guys have got some great value. What are the final takeaways you give to people listening today? And they go, right, what should I be thinking about? You know, what, what would you give to the guys listening today?

I think most important for me has been to really stay curious, be. Have an open mind. And because the treasury world, the banking world, the fintech world is, is evolving very, very fast. But also the way we work, working from home, hybrid working, stay curious, take opportunities. So like I said, for me, my career has not been a straight line from treasury analyst to group treasurer. Keep an open mind, stay curious and keep learning. Because if you stand still, you're never finished. You always need to develop more. And like I said, stay curious and keep on learning.

There you go. A few times before, and I think it just keeps coming back, keeping that curiosity, that learning, you embody it with nurturing and everything else and. Well, thank you for your passion, sir, and looking forward to catching up with you soon as well. You know, we're starting to finally meet everyone in the Treasure community. Great to see everyone. So look forward to seeing you soon, sir.

Absolutely. Thank you, Mike.

Thanks very much.

Hello, it's Mike here again. I hope you enjoyed this week's show. If you did, then maybe you want to follow the show or subscribe, depending on where you listen, whether that's itunes, Spotify or another great place to listen to the show from. It's totally free and means that you'll be the first to see each and every week when we release a new show. And maybe whilst you're there, you could even leave a quick review. Reviews and ratings are among the most important metrics for a podcast to effectively rank, and as you can probably appreciate, the podcast is a lot of hard work to produce. Every week it'd be amazing. Just take, say, 20 seconds. Leave a quick review of my amazing guests and their great career stories. We'd really appreciate it. Thanks very much and I can't wait to see you soon.