Lean Kanban at Ria Money Transfer

Lean Kanban at Ria Money Transfer Jose Luis Soria Continuous Improvement Manager jsoriat@riafinancial.com @jlsoriat #lkse15 Madrid, April 21 st 2015

We are Ria The third largest money transfer company in the world and part of an industry that moves more than $500 billion each year. Ria exists thanks to the dreams of some 232 million international migrants that left their homes in search of something more. Many don t have access to traditional banking services, so we provide a secure, reliable and affordable way for them to send money home to their loved ones. 2

RIA IS PART OF EURONET WORLDWIDE EURONET WORLDWIDE, Inc. (NASDAQ: EEFT) EFT Processing Money Transfer Payments & Prepaid epay0 Largest Independent ATM deployer in Central & Eastern Europe Largest independent shared ATM network in India Payment Systems Software licensed by 126 customers in 54 countries Consumer-to-consumer and business-tobusiness money transfer services Available in over 130 countries through a network of 243,000+ agent & store locations Extensive global electronic payment and distribution network 200+ agreements with mobile operators 100+ agreements with non-mobile content providers

THE MONEY TRANSFER SEGMENT EFT Third largest global money transfer company Founded in 1987, 2,400+ employees Services in over 130 countries through a network of 243,000+ agent & store locations Serves migrant workers, unbanked and underbanked individuals Moved $12.2B principal in 2014 Provides foreign exchange and payment services Founded in the UK with operations in Australia, New Zealand, and Spain Acquired by Euronet in 2014 Serves corporates typically SMEs - and individuals typically whitecollar workers Moved $8.2B principal in 2014

RIA HISTORY Ria launches in New York City Expands to Europe: Spain, France, Italy, UK & Germany Opens office in Australia Ria is acquired by Euronet Worldwide Inc. 1987 1993-2002 2005 2007 A hub in Dakar, Senegal is opened A hub in Mumbai, India is opened riamoneytransfer.com launches in the US launches in the US 2010 2011 2012 2014

THE CUSTOMERS WE SERVE Our Target Customers: o o Migrant Workers estimated at 232 million Underbanked/Unbanked - 2.5 billion adults, over half of the world s adult population, do not use formal financial services to save or borrow Remittance flows to developing countries reached $435 billion in 2014, 7.8% growth over the previous year Global remittances, including those to developed/high-income countries, estimated at $581 billion in 2014, will rise to $681 billion in 2016 Sources: United Nations www.unpopulation.org, www.financialaccess.org, World Bank

Financial Acculturation Money Movement Options OUR CUSTOMER NEEDS AND USE CASES We strive to offer the most simple, reliable and friendly money transfer service. We go to great lengths to ensure people's hard-earned money is received by their families wherever they may be around the globe. Migrant Supporters Sends for: regular support Looks for: value, speed, reliability Thoughtful Gifters Sends for: gifts on special occasions Looks for: convenience, reliability, speed Professional Achievers Sends for: gifts, payment, investment Looks for: simplicity, convenience, safety Education Sponsors Emergency Saviors Sends for: ongoing support, gifts, assistance Looks for: convenience, reliability, speed Tenure in the Host Country Established Immigrants Sends for: ongoing support, gifts, investment Looks for: convenience, simplicity, reliability

THE SERVICES WE PROVIDE Money Transfer Check Cashing Bill Payment Prepaid Airtime Products 9

NETWORK OF GLOBAL STORES AND AGENTS Americas 66,000+ locations 151 stores Global HQ, California, U.S.A Europe 38,000+ locations 74 stores EMEASA HQ, Madrid, Spain Africa 14,000+ locations Asia Pacific 125,000+ locations 3 stores 243,000+ locations in 130+ countries 22 licensed money transfer countries 60 money transfer-originating countries Customer Service and Regional Offices: Call Centres in USA, Spain, El Salvador, India, Senegal, Philippines, China

NETWORK GROWTH Location Count Locations by Region 2014 110.000 CAGR 4Yrs: 22% 146.000 177.000 216.000 243.000 ASIA 51% Africa + Oceania 6% N. America 10% Europe 16% LAC 17% 2010 2011 2012 2013 2014 Money Transfer Transaction Growth Million transactions CAGR 4Yrs: 21% 40,4 18,8 20,7 23,7 27,8 2010 2011 2012 2013 2014

DISTRIBUTION CHANNELS SEND PAYOUT AGENT LOCATIONS AGENT LOCATIONS COMPANY OWNED STORES COMPANY OWNED STORES BANKS SELF SERVICE ONLINE POST OFFICE RETAILERS ATMs

MONEY TRANSFER TRANSACTION FLOW

At Ria, compliance is everyone s responsibility. We take our responsibility seriously, and we re proud of our record. With dedicated Compliance Officers and Certified Anti-Money Laundering Team, Ria regularly conducts: Agent Verification, Documentation and Credit Review Onsite and Offsite Agent Visits, Automated and Over-the-Phone Transaction Monitoring and Verification In-depth Compliance Training

REGULATORY AUTHORITIES United States of America: Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC). States and Local Governments States Licenses: Ria holds licenses to conduct the services of money transmission and the sale of checks (e.g., money orders) in all 48 states regulating these services, plus the District of Columbia (D.C.), Puerto Rico and the US Virgin Islands. Europe: Financial Conduct Authority (FCA) United Kingdom, EPS Countries (France, Germany, Finland, Netherlands, Luxembourg, Cyprus, Norway, Denmark, Poland) Australia: Licensed by Australian Securities & Investments Commission ( ASIC ).

2014 HIGHLIGHTS Launched riamoneytransfer.com Went live with Walmart2Walmart Acquired HiFX Named Supplier of the Year by Walmart Added 30k+ locations Obtained money transfer license in India Euronet (EEFT) stock price has gained ~50% in the last 15 months

GLOBAL STORES USA CANADA SPAIN CHILE

Culture

Processes

Continuous improvement? Larman's Laws Of Organizational Behavior Organizations are implicitly optimized to avoid changing the status quo middle- and first-level manager and specialist positions & power structures. Corollary: any change initiative will be reduced to redefining or overloading the new terminology to mean basically the same as status quo. Corollary: any change initiative will be derided as purist, theoretical, revolutionary, and needing pragmatic customization for local concerns - which deflects from addressing weaknesses and manager/specialist status quo. Culture follows structure.

Operations

MONEY TRANSFER TRANSACTION FLOW

DISTRIBUTION CHANNELS SEND PAYOUT AGENT LOCATIONS AGENT LOCATIONS COMPANY OWNED STORES COMPANY OWNED STORES BANKS SELF SERVICE ONLINE POST OFFICE RETAILERS ATMs

Kanban principles Start with what you know Pursue incremental, evolutionary change Respect the current process, roles, responsibilities

Kanban core properties Visualize workflow Limit WIP Manage flow Make policies explicit Improve collaboratively

Kanban principles Start with what you know Pursue incremental, evolutionary change Respect the current process, roles, responsibilities

Kanban core properties Visualize workflow Limit WIP Manage flow Make policies explicit Improve collaboratively

How is it going?

DISTRIBUTION CHANNELS SEND PAYOUT AGENT LOCATIONS AGENT LOCATIONS COMPANY OWNED STORES COMPANY OWNED STORES BANKS SELF SERVICE ONLINE POST OFFICE RETAILERS ATMs

MONEY TRANSFER TRANSACTION FLOW

Little s Law Cycle time = WIP / Throughput

Reducing WIP: Portfolio management

Prioritization By cost of delay Weighted Shortest Job First Priority = (Value + Criticality + Risk Reduction) / Size Business Value Time Criticality Risk Reduction Size Priority Index L S XS XL 1000 S S S S 333 XL L XL XS 59

Communication PROJECT IN SCOPE FOR HIGH-LEVEL BUSINESS GOAL THIS MONTH NEXT MONTH LATER UNKNOWN EXPECTED DELIVERY BUSINESS HOLDERS IT OWNERS Project 1 Goal 1 Goal 2 Goal 3 Project 2 Goal 1 Goal 2 X Compliance Team 1, Team 2 X Operations Team 2 X Late June Compliance PO 1 X May Operations, Sales Team 3 X Marketing PO 2

Increasing throughput: bottlenecks

Theory of constraints Identify the constraint Repeat Exploit the constraint Elevate the constraint Subordinate to the constraint

Identify the constraint

Exploit the constraint Lean principles Eliminate waste Amplify learning

Subordinate to the constraint Lean principles Decide as late as possible Deliver as fast as possible Empower the team Build integrity in See the whole

Elevate the constraint Lean principles Deliver as fast as possible Empower the team Build integrity in See the whole

Support levels

Repeat

Some takeaways Evolutionary change. A small improvement is way better that no improvement at all. Backlogs/queues are waste. Be very selective about what you put in the backlog. Be very selective about the work you address next. Take care of communication. Use your toolbox!

Questions? Thanks! We are hiring! http://bit.ly/1dwn0ha Get the slides: http://slideshare.net/jlsoria Free ebook: http://aka.ms/releasepipeline jsoriat@riafinancial.com @jlsoriat #lkse15