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Obstacle Course: Overcoming 3 Payments Challenges

  • By David Levine
  • Published: 9/8/2016

Today’s business environment is like a "Tough Mudder" running competition. There are multiple obstacles you have to overcome if you hope to cross the finish line.

Bottomline Technologies has worked with scores of organizations, including global health services leader Cigna, as the organization navigated the complex global payment and cash management obstacles this new business landscape presents. In many ways, Cigna’s story is one we hear nearly every day.

Three big challenges

To start with, Cigna utilized a complex array of multiple claims and administrative systems that had either been implemented to support differing global products or were inherited from various acquisitions over the years. While many of the legacy payment processes and systems functioned well, some were costly, error-prone and an impediment to optimizing cash flow. Various functionality limitations, such as difficulty supporting new payment formats and multicurrency payments, as well as a lack of integration between the multiple claims and administrative systems, became a challenge. Add into this mix the significant effort required to establish connectivity with banking partners on a global basis, and it became clear that simple, day-to-day payment and cash management operations could be significantly strengthened and improved.

Cigna’s issues exemplified the three biggest payment challenges many organizations still face today, including:

  1. Removing inefficiencies from operations
  2. Gaining visibility into their cash position
  3. Achieving bank agnosticism.

These seem like simple things that shouldn’t be challenges, and yet like the obstacles in a Tough Mudder race, these three issues are a significant impediment for many businesses.

The reality is, the business world today is unrecognizable from what it used to be. Enterprises now operate in a truly global economy. Even just a decade ago, the supply chain for most corporations was primarily domestic and was managed by a central location. Now, the supply chain is global and the financial systems that support it have grown more complex. Globalization has led to new markets, operations, suppliers, customers, banks and new sources and uses of cash. The legacy systems most organizations currently have in place are not optimized to manage these new relationships efficiently.  The result is a messy conglomeration of applications and processes that can reduce productivity and obscure the true, real-time status of the business for executive leaders.

Moving on from legacy systems

So how can organizations effectively tackle the challenges that hold their businesses back? Three simple words: enterprise payment hubs.

Enterprise payment hubs have the power to turn the most grueling obstacle course into a walk in the park. Like technological magic, an enterprise payment hub brings order to a complex, transaction-based, siloed system dedicated to specific payment types and makes it possible to increase efficiency and gain visibility into cash positions by streamlining and standardizing the payments process across all enterprise applications, payment types and banks. Payment hubs can support global payment and remittance standards, consolidate inquiry, reporting and control capabilities, plus manage the complete payments lifecycle.

The benefits of a payment hub can go even further for large organizations, providing real-time global access to transactional information and account balances by consolidating payments and cash management positions into a single database, using industry standards such as SWIFT for connectivity and message formats. They can also interface with back-office AP and AR systems to integrate inbound and outgoing funds on a daily basis. This centralization of information makes it possible to:

  • View and control balances on all accounts across multiple banks
  • Forecast cash flow needs on a short-term basis and ensure liquidity for upcoming disbursements
  • Better manage liquidity by turning data into actionable intelligence.

Leading companies like Cigna are turning increasingly to payment hubs as a way to effectively address the complex global payment and cash management issues they now face.

Business is a process of continual improvement. The success of leading organizations relies on the ability to run streamlined operations that can compete effectively in a global marketplace.

David E. Levine is director, product marketing for Bottomline Technologies. Levine will discuss how Cigna was able to use technology to adapt to growing business challenges at the AFP Annual Conference in Orlando.


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