Ten years is a long time in treasury. But RaffiBasmadjian, France Telecom's head of group cash management andtreasury IT, is nearing completion of a plan he devised over adecade ago to overhaul the company's cash management and treasurystructures. “I drew up a target design 10 years ago and I'msticking to it, basically,” he says.

Basmadjian's association with France Telecom dates back morethan 20 years. He joined the company upon leaving university in1991, also the year in which France Telecom became a state-ownedcompany, having previously been part of the FrenchTelecommunications Ministry. This marked the beginning of itsprivatization (the French state now owns only 26% of the shares),as well as the internationalization of the company, which currentlyhas a presence in 94 countries, including strong positions in theU.K., Spain and Romania.

As Basmadjian points out, it was essential for the treasury tokeep up with this international expansion. “Obviously you don'tmanage a domestic-only company in the same way that you manage amultinational company.” As a result, France Telecom hascontinuously taken advantage of the latest treasury technologyavailable, ranging from payment factories to SWIFT forcorporates.

In 1998, Basmadjian moved to a French TV broadcastingcompany before becoming the group treasurer at Global One, a jointventure between Deutsche Telekom, France Telecom and Sprint. FranceTelecom subsequently bought out its partners, as well as acquiringDutch network operator Equant.

“At the end of 2001, I had a phone call from the group treasurerof France Telecom,” Basmadjian recalls. “He said that since I wasone of the people who helped build the company's treasury, andsince I was also very well acquainted with treasury management inthe other roles I'd held, he wanted me to build a state-of-the-arttreasury combining everything I had learned from my previousroles.”

Basmadjian took this objective to heart andsince then has focused on transforming the company's cashmanagement and treasury structure. His vision at the outset was tocreate a treasury management structure centered around threeprocesses: cash pooling, netting and a payments factory.

“As of today, I've got 77 subsidiaries in my treasury center and35 subsidiaries using my system, which makes 112 subsidiaries thatare on our treasury management application. I have 197 entities onthe netting system and 210 entities in the cash pool,” he explains.“The only thing I haven't implemented yet is the paymentfactory.”

Basmadjian says that the economic turbulence of recent years hasonly given more credibility to the project. “It was a pragmatic,step-by-step approach and we're in control of everything we havedone so far,” he says. “The way in which things have beenimplemented has evolved slightly over the years. For example, Iadapted my design to fit the initiatives developed by SWIFT. Butthe goals have remained consistent throughout. I'm about 30subsidiaries away from having everything in my treasury managementstructure—and completing the target design that I drew up 10 yearsago.”