Building a Global Payments Factory – Beam Suntory’s Transformation Story
Operating on a global scale can lead to various challenges for an organization, particularly when it comes to payments processing, payments centralization and payments optimization. This is true for Beam Suntory, the world’s third largest producer of distilled beverages and spirits.
A long-time user of Kyriba as a treasury management system, Beam Suntory realized the need to revolutionize its payments structure. At KyribaLive 2023, Beam Suntory’s treasury manager, Petar Tomicic, discussed how Kyriba has been crucial for the organization’s transformation from manual and inefficient processes to a comprehensive payments factory.
Biggest Pain Point Without a Payments Factory
Approving payments was a very labor-intensive and manual bank-specific process. Having multiple bank accounts through various banking partners, as well as the global nature of the organization, Beam Suntory soon realized that a payment centralization project was necessary to optimize efficiencies – with flexibility and the ability to integrate with their existing ERP being top priorities.
Customized Integration or Kyriba’s SaaS Solution?
Customized solution integrations for each bank can be expensive, not only from a development standpoint, but also from a resource standpoint. “We found a large benefit to not implement customized solutions with each bank independently,” Tomicic said. “The number of bank accounts we had and the customization, we felt that wasn’t ideal for us,” he later explained.
A customized payment solution usually creates heavy reliance on IT resources to complete the development. Kyriba provided Beam Suntory with the must-have requirements and did not come with the hefty price tag associated with a custom integration solution.
Kyriba manages the complexity of managing custom integrations, allowing IT to focus on other critical tasks. This also allowed Beam Suntory’s teams to be more flexible should they decide to change banks – or, for that matter, make any other process-related changes.
Lower implementation costs were not the only benefit Beam Suntory experienced with the payments optimization project. Tomicic said that they also experienced a decrease in time to process payments as well. The move from manual to streamlined has been beneficial to all the teams involved.
Building a Payments Hub to Enhance Collaboration
Payment flows and foreign exchange management, Tomicic said, depend on where the product is produced and where it is sold. “We have a lot of different groups that are managing those payment proposals,” he said. And the treasury department typically works mostly with banking partners. The organization’s shared service center manages the day-to-day payment processing.
For this reason, internal collaboration is imperative. However, although the treasury department leveraged Kyriba for treasury operations, the shared service center and accounts payable teams were not leveraging the system. The main reason was that those teams had more demanding requirements for payment processing capabilities, including:
- Ability to connect to SAP
- Ability to conduct approvals outside of banking systems
- Ability to process payments without logging into numerous bank portals
Kyriba’s strong SAP integration and its advanced payments hub solution met these requirements. And, because Kyriba was already in place as the TMS, it was a quick decision for the organization. “It was an easy choice,” Tomicic said. “We tested it within a region to see how [Kyriba] would perform and, with that, we gained confidence in the process.”
Implementing a Payments Factory: Best Practices from Beam Suntory
The implementation of a global payments factory can look quite different from organization to organization. It varies based on the project objective, as well as the size and scope.There are many best practices companies can learn from Beam Suntory.
Meeting Local Requirements
As an example, in order to implement Kyriba in Canada, Beam Suntory worked with the local Canadian governments and liquor boards to determine which entities would roll over into the new bank. The second phase was heavily focused on connectivity, in other words, to build integration from the SAP systems to Kyriba to the bank. This required building out the payables interface, ensuring GL posting was back and tested to ensure there were no delays.
Making Resources for Implementation
For many organizations, the lack of dedicated resources to complete a payments factory implementation can slow down the process. Tomicic indicated that having resources in various regions streamlined the process. “You’re going through region-specific details that need to be included in the remittance within the payments,” he said. “It’s very flexible in terms of, you don’t necessarily need one dedicated resource to manage it globally.”
Evaluating the Global Needs
The payments factory roll-out does not have to be a big bang project. “We started small in one region,” Tomicic explained. According to Tomicic, Beam Suntory continues to evaluate. If they determine that the organization would benefit from a more standardized payment process, they may implement the Kyriba payments factory in that specific region.
The Benefits of a Global Payments Hub
Before the payments hub implementation, the teams at Beam Suntory had to log in to various bank portals and systems to gather information and approve payments. This was a cumbersome and time-consuming process, as each user had to work through the different workflows and technologies each bank used.
After the implementation, Beam Suntory’s team has a more simplified and streamlined end-to-end workflow and better controls. “The approval process is easier to manage now that it takes place in SAP,” Tomicic said. He stressed that this has allowed the teams to operate more efficiently and easily.
The standardization of payment files has also been critical for the Beam Suntory team. “The standardized payment files – as we continue to grow – will help us as we roll out into new markets,” Tomicic explained.
With the payments hub in place, Beam Suntory’s payment proposals and AP approvals are done directly within SAP. Once the proposals are approved, a flat file is sent directly from Beam Suntory’s SAP system to Kyriba, where it is converted into an ISO format and submitted to the bank. Streamlined and efficient, the new process has also helped create the proper controls to protect Beam Suntory from fraud and compliance risks.
About Beam Suntory
In 1795, a farmer and grain mill operator named Jacob Beam produced the first barrel of whiskey that would become Jim Beam®, the world’s #1 selling bourbon. Suntory was founded in 1899 by Shinjiro Torii, who created the first whisky to suit Japanese palates. Beam Suntory, Inc. is a multinational company and the third largest producer of distilled beverages worldwide.
Watch our on-demand webinar to learn more about Beam Suntory’s treasury and payments factory transformation journey.