Unleashing the power of Finance

Fernando Valenzuela, Chief Financial Officer, RBC Investor Services Bank

Photo credit: Finance Leadership team (from up left to down right): Jérémy David, Fernando Valenzuela, Konstantinos Fylachtakis, Debbie Hearsey, Dermot Hanly, Estelle Lamouline, Ajibade Yusuf, Richard Hansen, Zico D’souza

Fernando Valenzuela (Chief Financial Officer of RBC Investor & Treasury Services) tells us more about his team’s latest projects and achievements. He notably described RBC’ 3-year transformation journey, which aims at making the bank more efficient and at shifting resources to support the business. “We are now in a good position to face the future. But you’re never done, right?” concluded the CFO.


What were the strategic and operational objectives of your journey?

In 2020, the Luxembourg Finance team of RBC Investor & Treasury Services (“RBC I&TS”) completed the last and critical phase of its transformation strategy to create the Finance function of the future. The 3-year program included the fundamental transformation of our financial systems, processes and organizational alignment to unleash the power of the Finance function.

With ever-increasing margin pressures in the global custody banking sector, the Finance function is transitioning to become a true “Business Partner,” and do its part in supporting the efficiency of its own activities, so as to fundamentally improve how RBC I&TS’s 1.1 trillion EUR Assets-Under-Administration operation in Luxembourg works.

In 2018 and 2019, the team led the implementation of leading-edge SAP S/4 Hana technology for our financial accounting (integrated General Ledger), COUPA (Purchase to Pay) and SAP CONCUR (Travel & Expense) across 13 out of 16 branches/subsidiaries across the 10 geographies we operate in Europe and Asia (the “Group”). This implementation had already enabled the team to find synergies in our operational, closing and reporting processes and controls in each location.

In 2020, the objective was 1) to implement the three systems for the three remaining entities of the Group, 2) to standardize and to centralize Finance operations across all  five European locations into a Luxembourg Shared Service center, and 3) to implement SAP S/4 Hana - Group Reporting to enable a fully integrated system for closing, consolidation and statutory & regulatory reporting for all 16 branches/subsidiaries.

Faced with the COVID-19 crisis in 1Q/2Q20, we had to pivot to focus on our core activities and ensure that the Bank remained safe and secure, especially during the first few months of the crisis when there were unprecedented periods of volatility and uncertainty. With all of our entities on the same integrated ledger (SAP S/4 Hana), the team was already able to navigate, the record transaction volumes and changes in global monetary policies, with higher transparency and visibility to the financial results across the Group.

Within days, the team adapted to the new ways of remote working through RBC-enabled soft token technology, and returned to the large-scale change towards the end of 2Q20. The fact the team was able to deliver the full scope of this last critical phase within, during a crisis, is still hard to believe:

1Q20 – SAP S/4 HANA implementation at the last three remaining entities of the Group,

3Q20 – COUPA and SAP CONCUR implementations for the last three entities of the Group,

4Q20 – Standardization and centralization of Finance activities into the Luxembourg Shared Service from 5 European locations,

4Q20 – State-of-the-Art SAP Group Reporting (SAP GR) consolidation & reporting tool implementation for the Group.

What did you put in place to support them in adopting the new system / solution / requirements / way of work?

Drive to impact, always learning & adapting, collaboration and unlocking our team’s potential, are cornerstone traits at RBC. In conjunction with over-communication and empathy, these have been instrumental for our team’s achievements in 2020, despite being faced with the global pandemic and the new ~95% work from home (WFH) environment.

To deliver on this ambitious agenda, we used an AGILE project management approach (Stories, Workstreams, Sprints, Scrums…), and partnered with our functional peers across our geographies and our Finance IT team based in London.

From the beginning, we engaged the largest number (+80%) of “final users”. The “Product Ownership” roles were split across the appropriate Senior Managers, and they selected their own “Champions” to lead the tactical execution. The teams ensured that the best and most knowledgeable resources, with no boundaries,  were used to manage the more complex challenges. This multi-level engagement was critical in the design, testing and acceptance of the new products, processes, controls and organizational re-alignment.

Back in 4Q19/1Q20, multiple BIG ROOM planning sessions were held to nurture trust, foundations and momentum for our 2020 objectives. We also leveraged our Finance Change Council throughout the year to review and approve changes to finance processes, prioritize demands, and ensure resources were adequately allocated.

By the end of 2Q20, we had adapted to the new WFH environment, and we started having 100% of our daily scrums held over Webex videoconferencing. This created an even closer virtual team, truly independent of location. We started sharing family events and stories more openly, being accepting of noises in the background during our meetings, and established a set of “Common Guidelines on how to operate in the New Normal” (ex: rules on communication, right to disconnect, etc...). This pushed our commitment and team spirit above and beyond any expectations.

At our regular “Town Hall” and “Skip Level” meetings, we engaged with the teams on the reason and the advantages for this fundamental change: 1) Shifting Finance towards a business strategist and catalyst role , and 2) broader, richer mandates, new skills, trainings and long-term career opportunities.

Finally,  we established a “Develop the Team” program to support our employees’ adaptation and future growth with personal, technical, and language trainings, amongst others, that would arm them with the skills needed to succeed in this new world .

How did your achievements benefit RBC I&TS?

2020 marked the culmination of our 3-year transformation journey. Throughout the project, we tracked the following five KPIs and were able to demonstrate the success and outcome of our fundamental change. As of 1Q21 vs. 2017, we had :

  1. Reduced by ~55% Manual Journals and End-User-Computing tools (ex: Excel),
  2. Improved ~20% the month-close, consolidation and reporting timelines,
  3. Decommissioned 8 legacy GL, consolidation & reporting systems,
  4. Achieved ~30% synergies in processing and accounting activities across Europe, and
  5. Boosted by ~20-25% controlling, analyzing and business partnering activities.

We have successfully delivered an integrated SAP S/4 Hana, COUPA & SAP CONCUR system infrastructure across all our 16 entities in 10 jurisdictions.

We have standardized and centralized most of our activities across Europe into RBC I&TS Luxembourg, setting up a Shared Service that offers our diverse and multi-national employees richer, broader mandates, and long-term development opportunities.

We are now benefitting from enhanced connectivity, transparency, risk-based controls, and business intelligence thanks to this integrated daily digital financial information flow.  In line with our vision and those of our business leaders and partners, this has enabled us to unleash substantial capacity for the team to now focus on its strategist, catalyst and business partner role of the future.