Success Story

Kuala Lumpur Kepong Berhad (KLK) Revolutionises Treasury Management Processes with Kyriba

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Kuala Lumpur Kepong Berhad (KLK), a multinational company with over 100 subsidiaries and a revenue exceeding RM24 billion, embarked on a transformative journey to overcome significant challenges in its treasury management processes. Facing operational risks and cumbersome banking procedures across bank accounts, KLK identified key issues in cash visibility, authorised signatories, trade financing, investment management, intercompany loans, and decision-making. In the dynamic landscape of treasury management, KLK encountered several challenges that prompted a transformative journey.

Challenges Addressed

  1. Lack of Centralised Visibility
    One pressing issue was the lack of centralised visibility in cash management, leading to inefficiencies and difficulties in navigating the complexities of cash flow. To address this, KLK embraced Kyriba’s solution, which introduced a centralised system providing comprehensive cash visibility. By consolidating data from all banks into a unified interface, KLK gained the ability to manage cash more effectively, overcoming the hurdles posed by decentralised processes.
  2. Manual Maintenance of Signatory Management
    Another critical challenge was the manual maintenance of authorised signatories resulting in time-consuming processes leaving room for errors. This process was streamlined through Kyriba, ensuring accurate records and minimising the risk of errors in signatory management. The implementation of Kyriba not only brought efficiency to this aspect but also laid the foundation for a more secure authorisation system.
  3. Communication Gaps
    There were also communications gaps between subsidiaries and the Corporate team which posed challenges in trade financing, leading to missed opportunities for favourable terms. Kyriba’s innovative deal capture function provided a solution to this by enhancing transparency, enabling the Corporate team to access crucial information immediately. This empowered KLK to negotiate more favourable financing terms, fostering better communication and collaboration across the organisation.
  4. The Need for a More Efficient Investment Management
    KLK was also looking for a more efficient way of investment management, which were handled separately by subsidiaries, resulting in varying interest rates. Kyriba facilitated the pooling of investments, optimising returns and ensured consistent interest rates across subsidiaries. This strategic shift not only harmonised investment practices but also contributed to improved financial stability and returns for the organisation.
  5. To Ensure Data Accuracy and Consistency
    Kyriba’s centralised system for intercompany loans also was leveraged to ensure accuracy and consistency in data. This transformation streamlined intercompany transactions, contributing to a more accurate and transparent financial reporting process. Access to timely and accurate data is important to support strategic decision-making across various aspects of treasury operations. Kyriba’s holistic reporting capabilities allowed for this and provided KLK’s stakeholders with timely and accurate data. This not only addressed the immediate challenge but also empowered decision-makers within the organisation to make informed and strategic choices, aligning with the broader goals of KLK’s treasury management transformation.

Results and Achievements

KLK’s adoption of Kyriba also led to:

  1. Operational Efficiency
    Daily timesaving of one hour per person. Monthly timesaving of 80 hours, quarterly timesaving of 240 hours, and an annual timesaving of 16,800 hours for a user base of 70.
  2. Cash Pooling and Investments
    Increased notional pooling rate resulting in increased interest income on a daily balance.
  3. Financing Negotiations
    Comparison of financing products and pricing, leading savings and reduction in interest expenses through effective negotiations.
  4. International Savings
    Reduction of interest costs for German subsidiaries, resulting in annual savings.

Conclusion

KLK’s implementation of Kyriba’s solution has resulted in streamlined treasury operations, optimised financial activities, and supported strategic decision-making. The benefits of this implementation include optimised efficiency, improved cash visibility, substantial cost savings in loan structures, enhanced monitoring of intercompany loans, and effective utilisation of reporting for day-to-day operations.

KLK’s success story is a testament to the power of strategic technology adoption in overcoming complex challenges and driving positive outcomes in treasury management. By leveraging digital transformation, KLK has established new best practices that have led to efficiency, cost savings, and better financial control.