In its 65-year history, Canadian-based energy company Enbridge has expanded well beyond its original business as a crude oil carrier. Through acquisition and new development, it has moved into natural gas and renewables across North America and continues to look for global expansion opportunities.
Growth = new challenges
The company’s recent growth has been exciting for Enbridge’s Treasury team, but has inevitably brought new challenges to help ensure that the treasury function kept pace with Enbridge’s expansion. Enbridge began to realize, eight years ago, that the systems and processes that had worked well in the past were cracking at the seams.
Joan Verleih is a senior advisor in Enbridge’s Cash Management & Banking group: “We had a limited number of staff, like most treasury operations do, and the volume of business that we were required to handle was just going up and up”, she remembers. “Although we were taking advantage of CashPro® Online offered by Bank of America Merrill Lynch (BofAML), there was still a lot of labor involved in generating hundreds of transfers per month on our side. Sometimes these would be condensed within a couple of days’ timeframe and it became clear that we just couldn’t handle it any more based on what we were using.”
In a familiar scenario, cash management at Enbridge had evolved into a complex ecosystem based on Excel spreadsheets and e-mail. It worked – just – but there wasn’t much slack in the system. The Enbridge team needed a modern cash management tool to get away from manually processing and reconciling hundreds of transactions every day.
System compatibility, team continuity
The new system would have to work alongside the company’s risk management system from OpenLink. A decision needed to be made:
- which functions would sit within the new cash management system
- which would stay within OpenLink
The new system had to be properly integrated with Enbridge’s Oracle enterprise resource planning (ERP) system. This system would generate files for cash management funding, along with OpenLink, and with the banking platform at BofAML.
In navigating this complex decision-making pathway, Enbridge was fortunate in two ways.
Rob Price, who had recently joined Enbridge as senior advisor in the company's treasury systems group, was just the person needed to lead the cash management and banking team to implement this new technology. Price’s background in both energy and financial systems gave him the ideal skill set to manage the implementation of the new system from the client side.
Close technology & banking relationship.
Through a careful RFP and evaluation process, Enbridge found a strong ally in Kyriba – a vendor whose system they thought was able to meet their business needs and which also had the necessary expertise to support complex implementations. Kyriba had already begun building a close working relationship of its own with BofAML which is one of Enbridge’s key cash management providers. It was this tight-knit, three-way team of client, technology provider and bank that was to become crucial to the project’s success.
Price soon realized the usefulness of the three-way relationship.
“From day one, having selected Kyriba, the key building block to get in place,” he recalls, “was that connectivity between Kyriba and BofAML. We were then able, through the Kyriba interface, to configure the reports and screens that were needed by the cash management team. We never felt that we were asking a question of Kyriba and BofAML that they’d not collaborated on many times previously.”
Ken Ketchum, global director for connectivity partnerships at Kyriba, agrees: “This was the first Canadian client we had collaborated on, but by that stage we already had significant experience of working with BofAML in the U.S. Today we have more than 130 common customers. Having formalized our relationship and really focused on a strategic collaboration – as against just a project-to-project approach – has really benefitted us.”
The result was that BofAML and Kyriba were able to solve, between them, many issues that might have taken up valuable time and resources for the Enbridge Treasury team.
“We had an ongoing conversation with Kyriba to be sure that we optimized the Enbridge team’s time,” says Tom Durkin, Global Head of Integrated Channel Solutions at BofAML. “Through the on-going product-level strategic dialogue with Kyriba we were also able to influence some of the core issues that might pose a problem down the road in the implementation. Familiarity with each other’s product capabilities, features, formats, testing environments, support mechanisms and most importantly, with teams on the ground enabled both the bank and Kyriba to adapt faster to situations. This led to a strong level of back-up support that gave additional confidence and boost to the implementation on the ground.”
Treasury freed from many manual tasks
It took just two weeks to resolve the transfer of data from the bank to Kyriba, and the core cash management capability was live in less than six weeks. The system has been in continuous development ever since, notably through the addition of payments functionality, which produced yet more valuable lessons for the technical teams at Kyriba and BofAML.
“There were some tweaks that were required as we were working with Enbridge on payments,” says Ketchum. “The lessons learned through that project benefitted the overall relationship between Kyriba and BofAML. It brought us closer and will really help with future projects.”
For Enbridge, that close cooperation has resulted in a transformed environment for its treasury team.
“It’s hard to imagine ever going back,” says Price. “In fact, I think many of the people in the cash management and banking group now would find it really hard to even envisage the mountains of paper that were being dealt with and manual data entry that was happening on a daily basis, from about six o’clock in the morning, under the old world.”
Enbridge’s treasury team has found itself freed from many manual tasks and now have more time to analyze data for the benefit of the business, rather than simply inputting it.
“We have a very high degree of reliability of receiving and processing files,” Verleih says. “Now our team just takes that for granted. So much so that some of the newer members would find it very hard to revert to the old ways of doing things, just because they’ve enjoyed so much automation and such good reliability of the technology.”
- Rapid growth at Canadian energy company Enbridge meant treasury automation was becoming essential
- The transformed treasury environment has freed up time spent on data entry for more productive data analysis
- Cooperation between the company, the technology provider and its bank smoothed the way