How to keep focus and direction in your corporate treasury department when your company has been growing at 100%/annum over the last SEVEN quarters is, to put it mildly, an unusual problem, particularly when the period includes COVID-19 pandemic and adding many new trading countries. But Christian Schmahl, Director Treasury, Delivery Hero made it seem so simple in his presentation “Building The Runway: Setting Your Treasury Vision In A Hypergrowth Company” at the Group Treasurers’ Exchange virtual conference.
Delivery Hero is an online food ordering company that was set up in 2011 and now has 25,000+ employees operating in 49 markets worldwide offering their own delivery services. In Q3 2020 Delivery Hero processed 362 million orders (100% increase on 2019) with €3.4bn gross merchandise value.
Starting point and approach
When Schmahl joined DH three years ago, it was basically a greenfield site - treasury wise - with:
- A rudimentary treasury team
- Rudimentary treasury scope and controls
- A ‘Diversified’ global bank set up
- No TMS
- Many manual processes.
So where did he start? First Schmahl believes that you must have a clear vision and stick to it, don’t allow anything to deflect you from it. Second, although Schmahl didn’t stress this in his presentation as it is ‘so obvious’, keep everything simple with no unnecessary frills or processes.
Getting ready for take-off
Schmahl described what they have achieved so far:
- Extended treasury team setup with:
- Central Treasury in Berlin
- Regional treasury hubs in APAC, LATAM and MENA
- Extended the scope of treasury to cover:
- Cash management and liquidity management
- Operations management
- Risk management
- Streamlined global bank setup:
- Global core and partner banks including Citi, Unicredit, HSBC, BNP, and JPM
- Adopted a regional approach
- Installed one TMS to cover all global corporate treasury (SAP S/4 HANA)
- Increased level of automation in all corporate treasury processes including:
- Payment, reconciliation and reporting
- Intercompany funding
- FX trading – only through 360T
- Accounting and FI integration.
Schmahl/DH’s emphasis on ‘keeping it simple’ is shown by:
- How SAP’s TMS was adopted by the corporate treasury department because the rest of the company used SAP, and also because SAP 4 HANA was a new system with the latest technology, and thirdly because it enabled them to minimise the use of third-party APPs
- Inter-company loans are a major problem in any company growing this fast. To get control DH adopted a single monthly payment day and only funded through the system, i.e. no ad-hoc payments, so everyone understood what to expect.
Schmahl’s vision of the future is to maximise their digitisation of all treasury processes and move to real-time automation as they increase their use of Open Banking. Their long term aim is to transform DH treasury’s focus from operational to analytical and strategic. His dream is a Treasury Management Reporting Dashboard that shows a company overview with key drivers and performance.
In the Q&A Schmahl agreed with one questioner that in driving corporate treasury performance it is much easier if you start with a greenfield position, rather than with already established processes and habits. But he added, “Wherever you start from, you need to define your vision and don’t get distracted or lose focus. That is what really matters.”
CTMfile take: This was the standout presentation of the whole conference. Schmal’s insistence of having a vision that you stick to, and ‘keeping it simple’ just works, as his results show.
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