Netherlands State Treasury Agency

Going the extra mile for the national treasurer

Netherlands State Treasury Agency

The government is looking for ways of working more efficiently, more cost-effectively and with more transparency. That also applies to the Netherlands State Treasury Agency (Agentschap van de Generale Thesaurie). Zanders has helped the agency to optimize its treasury banking processes and to improve the cash management processes. In doing so, Zanders did more than was asked.

The Netherlands State Treasury Agency forms part of the Ministry of Finance. It is responsible for the sound and efficient financing of the public debt. The agency is thus the national government’s treasurer. It also represents the Ministry when concluding transactions on the financial markets. The agency was established in its current form on 1 January 2009 as the merger of the Central Cash Management Department (CKB) and the Agency of the Ministry of Finance.

Processes examined

To meet its financial and employee-related targets, the Ministry of Finance has to take steps to work more efficiently and cooperate more intensively. The organization also wants to be prepared for the future, in case the workload of treasury banking increases. That is why in late 2010, two years after the merger, the Netherlands State Treasury Agency decided to conduct a major review of the processes surrounding treasury banking. Steef Akerboom, senior dealer at the agency, was put in charge of the optimization project. He is not directly involved in treasury banking, so as a relative outsider he could assess the challenges with a fresh and objective perspective, without being compromised by his own preferences or history. “Government as a whole has to operate more efficiently,” he explains. ”We want to find out how we do things. How is treasury banking functioning two years down the line from the merger? Have we achieved sufficient synergy benefits over the past two years? And how can we prepare the organization for growth? Can we do more and deliver better quality with the same number of people? Do we need to computerize more? Integrate better? Who does what? Are our procedures properly documented? We needed some very fast-turnaround research, an independent perspective, a comprehensive analysis, and suggestions for improvements which we could easily implement ourselves.”

The agency wanted to involve an external consultancy, and after a detailed tendering process it opted for Zanders. “Zanders has a lot of experience at the interface between treasury management and the public sector, and it excelled with its clear and practical approach,” explains Rutger Kramer, senior policy officer.

“Zanders doesn’t just dispense advice from on high, it’s also willing to roll up its sleeves.”

Policies and processes

The team which consisted of Zanders consultants Koen Reijnders, Charles Zondag and Hendrik Pons, as well as Zanders partner Sander van Tol, spent quite a few hours in The Hague. “The agency is very clearly a merger organization,” observes Zondag. “They don’t always take the most efficient options. Everybody is promoting their own expertise. That sometimes leads to less than optimal solutions. In that sense this study came right on time.”

Zanders did not restrict itself to answering the efficiency question, but went much further. “We talked to as many stakeholders as we could,” explains Koen Reijnders. “Also with people in departments a bit further down the line. After all, processes go beyond treasury banking, and they have to link up properly. We wanted to make sure that the organization was ready for the future and ready for growth. That also meant that we had to shake things up a bit here and there.” The agency gave Zanders sufficient room to do so. Zondag points out: “The fact that our client was not directly involved in the processes we were looking at meant that we had the opportunity to take a broader view, so that we could deliver more than what had been asked for.”

The upshot of Zanders’s research was a practical report with many proposals for improvements, also in the area of policy. Zondag says: “You can look in detail at all processes, but that’s not the only way to make savings. What matters is the coordination between policy on the one hand and process on the other. Real process improvements need to be tested against policy and may require a revision of policy. Everything should fit together better. We gave the agency many suggestions, options to turn this way or that, and considerations to explore in the coming period. Strictly speaking that may not have been part of the brief. But luckily our client gave us some elbow room.”

Steef Akerboom observes: “Zanders described the organization well. They made a number of surprising suggestions which are helping us to gear our processes better to our objectives. We’ve had the first meetings where the findings were presented. The discussions got quite heated, I have to say, and some difficult questions were raised.” Rutger Kramer, senior policy officer, welcomes critical comments from the organization. “That’s all to the good. There’s nothing wrong with new things causing some tension. The first recommendations have already been followed up and implemented.”

“There’s nothing wrong with new things causing some tension.”

In-depth

The second study which Zanders conducted at the Netherlands State Treasury Agency related to improving the efficiency and quality of the cash management process. “It was important to us that Zanders didn’t just dispense advice from on high, but was also willing to roll up its sleeves, if you will,” explains Rutger Kramer, who coordinated the project at the agency end. Zanders was asked to map the process in detail and to indicate where it could be improved. While the first study was conducted quickly and organization-wide, the second study focused on a small, clearly demarcated process. “We could really go in-depth,” says Koen Reijnders, “and one of our consultants, Bas Rebel, played a key role.”

“In addition to making recommendations on process management, we advised the agency on how to make cash management more predictable and more efficient,” explains Charles Zondag. “The Agency can make money this way, for instance by saving on interest payments.” Rutger Kramer says: “We specifically asked Zanders to look at what certain interventions would mean in money terms. Efficiency is important of course, but how many euros a particular improvement can yield is also a very good measure.” Kramer adds that the improvements they wanted to make were not always possible: “In the first instance I expected we could gain a lot in IT terms, say through greater integration of systems. But that proved disappointing. It turns out, for instance, that the systems of some banks are not geared to integration at all. In an ideal world that should be the case, but in practice it isn’t.”

Excellent results

Zanders’s pragmatic approach offered the agency the opportunity to look both across the board and in-depth. This made it possible to save money and to improve efficiency and quality. The approach provided ample scope for Zanders’s specialist treasury knowledge and its extensive experience in strategy and organization. Kramer and Akerboom were impressed by the way Zanders operates: “What I like is that Zanders knows about so many areas. They’re very pragmatic and strive for quality. And, I think, they’re creative in devising solutions.” Akerboom adds: “And you don’t have to explain anything about treasury banking to the Zanders people. They have all that knowledge in-house.”