Global Payment Systems Webinar

www.hawkeyechannel.com


Maximize Your Channel Success with Effective Global Payment Systems

November 12, 2009Vaughn AustVP, Product Management


Why cash payments? Partner perspective

Vendor perspective

Challenges of global payment systems Process Inconsistency

VAT/GST liability

Security

Bank account validation

One client’s success story

Making global payments work for your company

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© 2009 hawkeye, all rights reserved.

www.hawkeyechannel.com 3

“...Cash flow issues in the channel are coming up as a growing problem...

...for solution providers the trick to remaining solvent during the six to 12 more months it is going to take to see real improvement in the

market is going to revolve around cash flow and managing costs.”

Robert Faletra, ChannelWeb, July 2009

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Hawkeye Channel PracticeA

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Improvingthe Value of

Channel Relationships

Channel Strategy

Insight

Assessment

Best Practices

Channel Programs

Enablement

Performance

MeasurementChannel

Collaboration

Growth

Reach

Profitability

new!

www.partnerconduit.com

http://www.partnerconduit.com/


Over a decade of success in the ChannelA

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1996 Cohesion, Inc. founded

1998 Hawkeye Group founded

2000 Hawkeye acquires Cohesion

2003 Hawkeye expands into Europe

2007 Hawkeye expands into Asia Pacific

hawkeye’s mission

To develop and execute innovative, technology-enhanced channel marketing strategies and programs that allow our clients to deliver incremental channel growth in terms of mindshare, channel solutions, and indirect sales.

http://www.businessobjects.com/

http://www.magnoliaav.com/

http://www.hitachigst.com/

http://www.cisco.com/


NA payment disbursement since 1996Global payment disbursement since 2005

Disbursement HistoryA

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…to EMEA:

$25.8MM

…within EMEA:

$76.5MM

…to Latin America: $1.3MM

…within North America:

$509MM

…to Asia Pacific:

$1.5MM

2009 = $775MM est.2008 = $614MM2007 = $450MM


WHY CASH PAYMENTS?

7© 2009 hawkeye, all rights reserved.


Partner Perspective

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Solution providers are focused on business critical processes in these challenging economic times and cash flow and on time payments are more important than ever before.

Partners want:

On time payments

Payments in their preferred currency

Consolidated payments for multiple programs

Clear visibility into benefits

Clear, consistent and understood process

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Vendor Perspective

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Vendors are focused on reducing costs and increasing partner satisfaction.

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Program Managers & Operations Managers want:

Reduce/eliminate partner complaints

Focus on program success

Finance Directors want:

Focus on other finance functions

Global tax liability painlessly addressed

Cost efficient payment process


CHALLENGES OF GLOBAL PAYMENT SYSTEMS



Why are global payments so difficult?

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Many challenges with global payment systems can be traced to several factors:

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1. Process inconsistency

2. VAT/GST tax liability

3. Security

4. Bank account validation


Process Inconsistency

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Process Pain Points

Multiple programs, duplicated effort

Different sources of payment information

Different VAT/GST tax advice and resulting processes

Different methods of collecting bank account information

Front line support knowledge

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VAT/GST Tax Liability

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Hawkeye Disclaimer

We are not tax experts, but are simply pointing out best practices that we have implemented for global, fortune 100 technology clients

Global VAT/GST Tax liability

More than 130 countries have these taxes

Vary between 5% and 25%

Partners are required to invoice the Vendor for the value of the award

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Security

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List of security considerations that Vendors should consider (whether a third party vendor or “do it yourself”)

How is Partner personal information stored?

• Encryption, storage and retention policies, access

Partner account entry – beneficiary name

If third party,

• Are they SAS 70 certified?

• Are they GAAP compliant?

Vendor Bank Account

• Access – signature and authorization policy

• Batch control and auditing

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Bank Account Validation

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Bank Account Validation

Routing Methods are different

• SWIFT

• IBAN

• ABA

Upfront/Online versus Backend

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SUCCESS STORY



The Situation

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The company had programs in over 100 countries and had been using regionalized vendors and internal, regionalized Accounting centers to process ~$1 billion in payments annually to over 8,000 partners.

The challenges for this company:

VAT/GST taxes

Inconsistent Process

• Across regions

• Across programs (both different and same regions)

• Same partner receiving different payments

High internal costs

Long payment lag times

Let’s look at how the company addressed each of these concerns.

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Global Payment Processing Needs

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The company was hoping that a single, global payment platform and process would help them with the following:

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Reduce processing time

Reduce transaction costs

Ability to consolidate multiple payments

Robust administrative metrics

Reduce payment exceptions

Standardize payment communication to partners

Decrease Help Center volume


VAT/GST Taxes

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Accounting firms process

Always pay VAT/GST to local governments and reclaim at the end of the year

Physical VAT/GST invoices

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Why?

“Market Penetration Services” are a cross-border, non-taxable item in the supply chain

Electronic invoices are legally acceptable in many countries


Process ConsistencyS

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Payment Pending Notification Email

Bank Acct Info Collection & Real-

time Validation

Payment Confirmation

Dynamic Online Invoice or Invoice

instructions


New Process Dynamic OptionsS

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After submitting or confirming bank details, dynamically display mailing instructions for a partner invoice or ask the partner to enter their invoice online, based on program and country. VAT was inclusive or exclusive, based on program and country.


Process Transparency - Partner Global Benefit StatementS

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At-a-glance summary of all Pending and Paid benefits

Drill down for detailed transactions

Multiple currency and Multiple language enabled


Where the Company/Vendor Cut CostsS

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COST

SAVINGS

Reduced Invoice Audit

DocumentManagement

Help DeskGlobal Payment

SystemGlobal Benefit

Statement


Vendor Cost SavingsS

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Customer Service Savings

Delivery & Audit Savings

Management Savings

38%

67%

20%

Savings/Payment $26.13

30-Day Payment Delivery SLA ~40% 95%+


Benefits of the New Payment System for Vendor

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Standardized, single global payment platform

Reduced payment cycle time

Predictable delivery of payments

Improved partner satisfaction

Consolidation of multiple payments

Reduced transaction costs

Centralized reporting and tracking

Consistent banking data collection

Intermediary banks enabled in payment process

Standardized payment communications

Online, consolidated reporting

Decreased Help Center volume

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Benefits of the New Payment System for Partners

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Consolidation of payments

Improved cash flow with faster payment

Provide bank details once

Strong communication

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Managing fewer payments

Standardized, predictable cycle

Online tracking of payment process

Payments in local currency

Greatly improved partner

satisfaction!


KEY POINTS/DISCUSSION



Evangelizing and Building a Global Payment System

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Planning and implementing a global payment system can be a real challenge. These important points will get you started:

1. Obtain key stakeholder buy-in and sponsorship

2. Define and prioritize Global Payments as a project

• Centralize operations budget

3. Audit and question current tax-related processes

4. “Operationalize”

5. Start with pilot

6. Survey, measure and improve

7. Roll-out programs in batches

8. Reduce cost and increase partner sat

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Key Points

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These are key best practices for an effective global payment system:

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1. Centralize

2. Standardize

3. Validate banking information upfront

4. Utilize electronic invoicing

5. Require partners to invoice for Market penetration services


Questions, Discussion

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Vaughn Aust www.hawkeyechannel.comVP, Product [email protected]+1.425.902.5146

THANK YOU


Documents

Global Payment Systems Webinar