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FX International Payments
By Phillip Silitschanu
In the past twenty years or so, outsourcing and offshoring have evolved in both depth and breadth to become more holistic solutions, part of what we know today as global business services. Initially, global business services targeted a few back office and middle office operations, and early adopters (in financial services and technology1) saw them simply as a way to cut operating costs. But they have grown since to encompass the full spectrum of business processes, global operations and governance. In the past, global business service vendors generally specialized in a single type of service, leaving customers to cobble together effective (or sometimes ineffective) solutions from multiple providers. Lack of transparency and communication among vendors, as well as the effort required to manage multiple relationships, often led to gaps in service quality.2
Today, global business services have become key strategic elements integrated into the operations of businesses large and small, whether they operate in one country or many. With more cohesive service offerings and better integration of services (both within service providers and between providers and clients), research by global professional services firm KPMG shows that businesses now look to global business service providers as more than just a way to cut costs.3
Global business services have evolved from outsourcing customer call centers and back office operations to helping companies address complex operational needs ranging from finance and information technology to procurement, human resources, sales, marketing, and more.4 The KPMG reports shows how global business services are being leveraged to bring greater operational efficiency, new human capital talent and better client service; it points out that companies using global business services are seeking results beyond precursory key performance indicators (KPIs). More specifically, according to another report, businesses are seeking to increase the effectiveness of their offerings, provide better customer experiences, expand data analysis for better decision making, improve supply chain efficiency and strengthen global regulatory compliance.5
Global payment services are prominent among global business service offerings, whether a company is only beginning to branch into international trade or already is a large multinational enterprise doing business in many different currencies. Global payment service providers typically offer many more methods of processing cashless payments than a given business would wish to manage for itself – and at lower cost due to their economies of scale. Some of the services available include transaction processing of credit and debit cards, card issuing services, payments from mobile devices and e-commerce. As international trade shifts toward cashless global payments, businesses have the opportunity to not only lower transaction cost, but improve customer experience.
As noted by global professional services firm EY, “Global business services operations make it possible for the rest of the company to concentrate its energy on successful and sustainable growth.”6 This is among the most valuable gains to be realised by a firm utilising a global business service provider. The firm can focus on what it does best, while global business services provide the firm’s back office, sales, billing, client services, human resources, or other functions. Further, global business service providers’ core focus on the functions they offer enable them to continuously innovate in those areas – areas in which other firms typically don’t innovate.
Global business service providers have evolved significantly over the last 20 years. Today, they offer dedicated expertise and continual innovation in operational services and can also offer strategic services enabling business expansion. In particular, global payment services are a potential offering for many companies to consider when conducting international trade.
Phillip Silitschanu is the founder of Lightship Strategies Consulting LLC, and CustomWhitePapers.com. Phillip has nearly 20 years as a thought leader and strategy consultant in global capital markets and financial services, and has authored numerous market analysis reports, as well as co-authoring Multi-Manager Funds: Long Only Strategies. He has also been quoted in the U.S. Financial Times, Wall Street Journal, Barron's, BusinessWeek, CNBC, and numerous other publications. Phillip holds a B.S.in finance from Boston University, a J.D. in law from Stetson University College of Law, and an M.B.A. from Babson College.
Sources
1. “Driving performance with global business services: How global business services can transform your business”, EY; http://www.ey.com/GL/en/Services/Advisory/Driving-performance-with-global-business-services-How-global-business-services-can-transform-your-business
2. Global Business Services, Better together, Deloitte;http://www2.deloitte.com/content/dam/Deloitte/uk/Documents/finance-transformation/deloitte-uk-global-business-services.pdf
3. The GBS Payoff: Leaders Drive The Metrics That Matter, KPMG; http://www.kpmg-institutes.com/content/dam/kpmg/sharedservicesoutsourcinginstitute/pdf/2016/gbs-payoff.pdf
4. Ibid.
5. KPMG global insights pulse: the need for GBS maturity,KPMG; https://assets.kpmg.com/content/dam/kpmg/pdf/2016/05/global-insights-pulse.pdf
6. "Driving performance with global business services: How global business services can transform your business", EY; http://www.ey.com/GL/en/Services/Advisory/Driving-performance-with-global-business-services-How-global-business-services-can-transform-your-business
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