The company set up the first regional office in Canada, where there were only three big operating units. The next market to fall into the centralization crosshairs was Asia. Here, the effort was complicated by 17 subsidiaries in seven countries. In Europe, it was even worse since IP operated in more than 20 countries. To gain faster control over cash in Europe, IP applied daily zero-balancing concentration for euros and British pounds in accounts controlled by the Belgium coordination center.

The centralization project required the support of both senior management and the local business units, says Samir Patel, manager of international treasury. "Historically, treasury decisions resided at the local level, and as a result, we wanted to be sure they felt they had a voice in the whole process," Patel says. "An important element was to have contact at a local level through on-site visits." IP treasury also spent a good deal of time explaining the potential benefits for a subsidiary's P&L. "We got their input or any recommendations," Patel says. "And as we prepared our RFP (banking), we made sure it was vetted by operations to be sure we understood what they needed."

CASH MANAGEMENT – Silver

Motorola

In 1999, Motorola Inc. estimated that it was getting less than the optimal return on more than half of its overseas cash. The expansion of Motorola's international business in the 1980s and '90s, together with its decentralized management approach, had left it with cash sitting in bank deposits and overnight investments around the world, with more than 100 financial managers responsible for making those investments. Now, it was time to bring some discipline to the operations, and Motorola came up with an innovative approach: It set up private money market funds that its financial managers around the world could use to invest dollar-denominated cash. At the same time, Motorola took steps to increase its liquidity by terming out short-term debt by issuing long-term debt and by improving its tracking of cash.

The two private money market funds are managed according to Motorola's guidelines, which include a slightly longer maturity than is usual for a money market fund. The funds have yielded almost 50 basis points over the company's benchmark, three-month LIBOR, boosting interest income by more than $11 million a year. Byron Jackson, an assistant treasurer at Motorola, says overseas financial managers were happy with the plan once they learned that they could get their cash back at any time. "So the individual financial manager in-country doesn't have to worry as much about an unexpected cash requirement in the [coming] days or weeks, and he's getting the maximum return given his liquidity," says Jackson.

CASH MANAGEMENT – Bronze

ING

The last couple of years have been hard for everyone. But the U.S. financial services arm of ING Group, a global financial institution, had to cope not only with the languid economy and low interest rates, but with integrating newly acquired units. All the more reason for its U.S. Treasury Services unit to undertake a project to revamp its processes and maximize both cash forecasting and the cash it had available for investment.

Renee McKenzie, the head of U.S. Treasury Services, says the effort's theme was "centralized treasury" and the key to its success was showing colleagues how much money could be saved. "Once we could substantiate the hard-dollar savings, everybody really got on board," McKenzie says. For example, her group implemented a homegrown Web-based wire transfer system that it estimates saves ING $500,000 a year in fees and other expenses. An in-house bank that's run mostly on spreadsheets produced more than $8.6 million in savings on bank fees and charges. ING also cut cash invested in low-yielding investments by $750 million, freeing up more than $270 million of capital. And as it integrated the newly acquired treasuries, it realized savings of about $3.5 million by consolidating systems, rationalizing banking relationships and reducing headcount.