sap financial services network – presentation for corporate customers

SAP Financial Services NetworkSolution Overview

November 2015

2© 2014 SAP AG or an SAP affiliate company. All rights reserved.

Cloud

Abundance of cost-

effective computational

power and storage

Mobile

The new de facto

standard in business

interaction

Transformational technologies offer significant potential to

drive business innovation, relationships and integration

Social

Connected business

and social networks

Big

DataReal-time analytic

for behavioral and

predictive insights

More than 60% of CEOs expect 15-50% of their

earnings growth in the next 5 years to come from

technology-enabled business innovations.

– McKinsey study, 2013 ”“

Business NetworksA digital economy operating in the cloud driving real-time business relationships and processes

© 2015 SAP SE or an SAP affiliate company. All rights reserved. 3

SAP End-to-End Treasury and Risk ManagementTreasury Solution Map

Payments and Bank

CommunicationsPayment Operations

Monitoring and Status

TrackingPayment Factory Bank Connectivity

Cash and Liquidity

ManagementCash Position Bank Account Management*Electronic Bank Statements

Debt and Investment

Management

Financial Risk ManagementRisk Identification

Type and Origin of Risk

Risk Quantification

Exposure MgmtRisk Analysis

Risk Management

Hedge with Financial Instruments

Treasury Solution Map, Edition 2014

Workflow and Signatures

Liquidity Management

Front Office

Deal capture

Mid Office

Risk Controlling

Back Office

Correspondence & SettlementAccounting

Foundation Cloud Analytics MobileRapid Deployment

Solutions (RDS)HANA Platform

Suite Capabilities Shared Service CenterWorking Capital

ManagementGovernance Risk and Compliance Commodity Risk Management

58% Lower treasury cost

28% Lower cost of capital


Key Elements to Seamless Bank Connectivity & Integration

• Allow participants to achieve benefits of

integration when not all partners are at the

same level

• Ensure extensibility to multiple financial

supply chain partners with new connectivity

and security requirements

• Deliver integration directly into core

business processes at the company

• Create foundation for value added services

to enhance value of single solution

Monitoring & Analytics


SAP Financial Services Network

SAP ERP

AP/AR

Payroll

Treasury

In house

cash

Aggregate

Payments

Approval

Worklist

Exception

Handling

Status

WorkflowFSN Connector

ERP

IntegrationMessaging

Management

Multi-bank

Transaction

Routing

Monitoring &

Alerting &

Analytics

Approval

Workflow

SAP FSN

Connectivity

Security

Mapping

Routing

Monitoring

StatementsPayments

Statements

Payments

A complete end-to-end ERP to bank incoming and

outgoing process integration solution, benefiting

all key areas involved in the process. Operations/Shared Service Centre:

End to end payment & status

Tracking

Enhanced payments & statements

management

Lower manual intervention

Payment process performance

tracking and alerting

Treasury:

Centralised Visibility & Audit

Approvals Workflow

Bank Process Performance

Analytics

Higher STP, lower incidents

Global payments

Future value servicesIT Services:

Full multi-bank on-boarding and routing

Technical tracking and monitoring

Reduced Complexity / Low Running Cost

Security and Audit

Message Format Management

Single Support Point

Any applications/ERP’s

e.g. B1, Oracle, etc.



SAP ERP and non-

SAP systems

Connectivity &

Integration

Message

Management

Multi-bank

Transaction

Routing

Monitoring &

Alerting &

Analytics

Approval

Workflow

SAP FSN is a comprehensive solution that extends your SAP Financials and Treasury activity:

Connectivity & Integration

Secure Connectivity to back end ERP and other

systems

Packaged integration to payment and

reconciliation processes

Monitoring, Alerting & Approvals

Monitoring of transaction activity including

balances and latest available status on

transactions initiated through SAP FSN

Alerts and collaboration messaging

Rule based approval workflow

Multi user approval sequencing

Multi-bank Transaction Routing

Transaction routing of both “mediated” (transformed in SAP

FSN) messages and pass through messages (unopened by

SAP FSN)

Message Management

Message format management that separates customer

desired formats from bank desired formats

Standard, Country and Bank specific format rules

Test and production landscapes for on-going bank adoption

and testing


S4HANA

GL

Payroll

Treasury

In house

cash

Aggregate

Payments

Approval

Worklist

Exception

Handling

Status

WorkflowFSN Connector

ERP

IntegrationMessaging

Management

Multi-bank

Transaction

Routing

Monitoring &

Alerting &

Analytics

Approval

Workflow

SAP FSN

Connectivity

Security

Mapping

Routing

Monitoring

StatementsPayments

Statements

Payments

Proven FSN & S4HANA Out-of-the-box Integration

Secure and auditable end to end

Enhanced bank relationship analytics

Proactive monitoring and alerting

Ready to go corporate to bank process integration

Future proof SAP solution strategy

Full multi-bank connectivity

Single support model

FSN & S4HANA Public

Cloud Pilot:




Data mapping and process integration

Secure, private SAP-Hosted platformP

aym

ents

Mark

et

data

Maste

r data

Reconcili

atio

n

Rem

itta

nce d

ata

Analy

tics

Oth

er

serv

ices

Vir

tual card

s

Sta

tem

ents

paym

ent

advic

e

Busin

ess

monitori

ng

Banks, Card Providers, and

Market Data Providers

Payment

processing

Accounts

payable

automation

Card solutions

Cash

managementMarket data

Trade finance

Core Finance

Risk and Regulatory

Receivables management

Payables management

Shared services

Treasury and financial

risk management

Accounting and financial close

SINGLE integration to the financial institutions

EASIER access to new services

ZERO footprint and cost-effective model

OPTIMIZED cash flow and budget allocation

Extends corporate finance functions transacting with financial provider services


FSN Customer Success

Common Standards, a Superior Experience LINK

An Interview with Hemant Gada, Head of Channel and Enterprise Services, EMEA, Treasury and Trade Solutions, Citi

“Citi is working closely with SAP to create the SAP Financial Services Network (FSN). This is a cloud-based, secure network managed by

SAP that enables corporate treasurers and finance managers to connect with their banks directly through their SAP platform, without the need

to manage individual bank connections. By leveraging the FSN, corporations are insulated from the idiosyncrasies of each bank’s systems

and formats, and bank connectivity becomes seamless.”

DBS partners with SAP Financial Services Network to simplify banking for corporate clients LINK

Lum Yin Fong, Global Head of Product Management, Global Transaction Services, DBS

“At DBS, we constantly look at how we can leverage technology to simplify banking for our customers. Trailblazing the use of SAP FSN

underlines this effort. In this competitive business landscape, CFOs and corporate treasurers want a seamless, integrated connection with

their banks that automates financial transactions and provides them with visibility of their cashflow. With FSN, we are able to provide straight

through processing, operating efficiencies, as well as a more streamlined onboarding process for our corporate clients.”

Subscribes to SAP® Financial Services Network to Streamline Process for Corporations to Pay by Visa LINK

“As companies shift from labor-intensive, paper-based processes to more efficient electronic procurement systems, having the option to pay

with Visa will help simplify the process and bring many benefits,” said Tad Fordyce, SVP and head of Global Commercial Solutions, Visa

Inc. “We anticipate that being able to make Visa payments via connection to the SAP Financial Services Network will help corporations

streamline accounts payable processing, while avoiding the upfront and ongoing costs that would be associated with custom software for the

payment process.”

EUROPE

Live:

Testing:

http://www.treasury-management.com/article/1/300/2500/common-standards-a-superior-experience.html

http://www.dbs.com/newsroom/DBS_partners_SAP_financial_services_network_to_simplify_banking_for_corporate_clients

http://pressreleases.visa.com/phoenix.zhtml?c=215693&p=irol-newsarticlePR&ID=1895253&highlight=


Bank

Corporate

FS

N C

on

ne

cto

r

Bank

SAP HANA Cloud Platform

ERP

Data Mapping & Process Integration

SAP ERP

Payment Initiation

Payment Status

Bank Statement

Payment Initiation

Payment Status

Bank Statement

*Business

Cockpit

sF

TP

Payment InitiationANY ERP

Payments, Status & Statements

1. Bank Transfers/Credit Transfers/Direct

Debits generated from HR, FI or Treasury

systems.

2. Payment Run generates payment file in

any format.

3. Payments sent via FSN Connector to FSN

4. Payment payload mapped in FSN to ISO

format

5. Payment sent to Bank in FSN and mapped

to Bank desired format

6. Bank returns payment status and

statements, which go through reverse

procedure for required formats

1 2 3

4

3

5

6

1

2

3

4

5

6


FSN Message Management

Customer Input

FSN ISO FORMAT

Bank Output

FSN

Message

Library

contains

standard

mapping

cartridges

Bespoke to

Standard

Mapping

capability

and vice

versa

Corporate

required formatsFSN ISO

FORMAT

Bank required

formats


SAP Financial Services NetworkOn-board only once and add services and partners over time

FSN On-boarding

Connect to network

Agree message mapping

requirements

Perform on-boarding tests

Sign-off testing

Bank Activation

Request connection to

FSN network partner

Perform E2E connectivity

testing

Finalise service activation

Run and Manage

Monitor, manage and

deliver financial messages

Grow FSN network

connections

Add new banks & services

Bank


Corporate

TestTestTest

Production

Test

ProductionProductionProduction

Con

ne

cto

r

ER

P

BankCorporate

Preparation Activities

Questionnaire & Pre-reqs

Bank prioritization

Scope finalization

Project Planning

ContractsF

SN

Con

ne

cto

r

ER

P


Pricing Model

FSN monthly pricing based on:

# of backend connections

# of transactions (based on 1,000 transaction blocks, a transaction is defined as a single payment and single statement)

# of users for Business Cockpit

Option 1: A La carte

Choose how many connections, transactions and Business Cockpit Users required

Option 2: Standard Pack

3 Connections

30,000 Transactions

Business Cockpit (10 Users)

Purchase additional transactions (in blocks of 1000) as needed

Ontime On-boarding (Implementation) Fee:

Scope dependent.


FSN Delivers Value AccelerationFSN Business Cockpit for your banking relationships

• Central Business Cockpit for

payments visibility, status

monitoring and matching.

• Performance target KPI’s

• Mobile device enabled

• Batch to payment

transaction drill

through

• Approvals according

to rule definitions

• Performance tracking for

each phase of payment

life cycle

• Historical view of

performance over time


It’s not just about the bank connectivity….

SAP Business Networks: Simplify business collaboration with all your

business partners

Business Network

Risk &

Sustainability

Workforce

Management

Sales &

MarketingFinance

Travel &

Expenses

Discover

Connect Collaborate

Gain

Insights

BusinessNetwork

Your

Company

Your Company

Supply Chain

Management

Sourcing &

Procurement

Financial

Services

Industry


FSN Differentiation

Network Solutions

Independent Service

Providers

Bank Connectivity

Solutions

Bank ERP Integration

Solutions

SAP Financial Services

Network

20

Connectivity SecurityMulti-bank

Formats & RulesValue Services

Pain-point Value

Integration

FSN is the only solution to cover all key requirements.

e.g.

remittance

reconciliation

Enhanced analytics

Trade Finance

integration

Masterdata feeds

FX

Corporate Financing


Corporate Connectivity Increased Risk and High costs

Multiple failure points and/or complex

infrastructures

Implementation, operational and

development costs

Inability to manage counterparty risk

Reconciliation cost and capability

Lack of financial messages visibility and

control

Difficulties in managing working capital

across multiple banking relationships

ERP

Banks

Corporate clients

Banking Systems Banking Systems

Corporate clients

ERP

ERPERP


FSN Value Proposition

Business Case

SAP | 22

SAP Provides Values Value Drivers

Single point of entry to

Financial Service

Providers

Single communication channel to a financial network comprised of banks

and additional financial service providers

Reduced integration complexity as the network can handle mediation

through payment networks as well as direct host-to-host connectivity

Generic transformation and monitoring services available in standard

FSN offering

Additional Banking Services available through individual subscriptions

Mapping from domestic to international formats handled by FSN

FSN enrichment of payment formats with bank-specific domain

knowledge

Reduce Ongoing Connectivity

Costs

Avoid Future Connectivity Costs

Holistic view of

payments and other

future transaction

activities

Capability to integrate all major cash flow categories such as payments

and direct debits (source: FI/BCM) and salary, loans and social security

(source: HR)

Complete view of payment instructions, status and statement to

payment instruction matching through the FSN Business Cockpit in the

cloud

Reduce Working Capital Costs

Improve Treasury and Cash

Visibility

Improve Accounts Payables

Operations

Reduce Banking Fees

FSN delivers a range of features that result in material benefits driving cost savings, optimised processes and efficient resources across

your AP/AR and Treasury business.


FSN Value Proposition

Business Case

The SAP Solution

Value Driver Driver Parameters Current State / Pain Points Desired State

Reduce Ongoing

Connectivity Costs

Cost of bank connectivity - portals

Cost of bank connectivity - H2H

- # of formats and ongoing maintenance

- third-party solutions

- resources to maintain

- resources to manually upload/download payment files

Identify # of banking connections and costs associated including

hardware, software and support resources. Include implementation

costs.

Avoid Future Connectivity

CostsCost of bank connectivity - new H2H

Determine future banking relationships and factor in cost of separate

H2H.

Reduce Working Capital

Costs

Accounts Receivable balance

Accounts Payable balance

Weighted Average Cost of Capital (WACC):

Total annual procurement spend

Average annual savings (procurement)

Calculate current DSO and associated pain points. Determine payments

timing and desired improvement in terms of increased liquidity.

Improve Treasury and

Cash Visibility

Total hours spent for cash positioning and account reconciliation

Average hourly cost per treasury/accounting employee

Average volume of short-term liabilities at banks or short-term

investments

Average borrowing/investment cost

Assess operational cost of manual reconciliation. Apply FTE costs.

Improve Accounts

Payables OperationsEmployees for Accounts Payables (A/P)

Average fully loaded cost rate per employee

Understand support and maintenance requirements across message

formats maintenance, connectivity support, incident management and

payment enquiries.

Reduce Banking Fees

Cost of bank statements per year

Cost of bank payments per year

Assess current total cost of banking fees across banks by statements

and payments.

The FSN Business Case Calculator provides an in-depth model to help build a tangible business case using a distinct set of value driver parameters. As part of any next steps SAP will work with

you to complete the information below to derive quantifiable business benefit.


SAP Financial Services NetworkSupport Process

SAP Initiated

FSN contacts corporate if a message may not be transferred within SLA to bank tenant (for messages from

corporate) or corporate (for messages from bank) and corporate customer involvement is required for issue

resolution

FSN contacts bank if a message may not be transferred within SLA to bank (for messages from corporate) or

corporate tenant (for messages from bank) and bank involvement is required for issue resolution

Corporate

Customer

Create CSS Ticket

Response in CSS Ticket

SAP SupportBank

Customer

Create CSS Ticket


1 2


SAP Financial Services NetworkSupport Process

Customer Initiated

Corporate

Customer

Create CSS Ticket


SAP SupportBank

Customer

Create CSS Ticket


1 3

Contact Bank2

Contact Corporate4

Corporate customer contacts FSN if messages may not be transferred to FSN for technical error messages in the

sending backend due to events like FSN Connector configuration, security configuration or FSN service

availability.

Corporate customer contacts Bank for all business (message content) inquiries such as missing, negative or faulty

messages from Bank, missing pain002 / camt053, negative pain002, pain002 / camt053 messages received but

with unexpected content.


Next Steps

SAP is looking forward to partnering with you to help manage your banking relationship integration

requirements. We would like to propose a deep-dive workshop to help build a formal proposal for accurate

comparison against alternate solutions.

Recommended next steps are:

• Technical and operational review sessions

• Solution Deep-dive / Demonstration

• Build joint business case

• Identify key new innovation requirements for your business and include in SAP FSN Roadmap planning

SAP looks forward to feedback and confirmation of next steps.


www.sap.com/contactsap

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sap financial services network – presentation for corporate customers

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