While getting started may seem daunting, the key is to break up the process into small steps. The first step is to assess your current situation. To do this you will need to map out the current transaction flow and related processes in place to complete a payment transaction. Gathering an inventory of your current acceptance agreements is a great place to start. Then ask yourself these initial questions:
- Who is the acquirer? Do I have multiple acquirers and for what services do they each perform?
- Are there any contracts with payments networks or card issuing agreements?
- Has my company implemented third-party gateways?
- How does the infrastructure differ among channels?
- Have fraud prevention tools been deployed and through what partners?
- What roles are performed internally and by what functional area? What roles have been outsourced to third parties?
You will have a great start with all this information in hand and your current processes mapped out.
I recommend creating a flow chart of the process for your second step. With a flow chart in hand, it is now time to start assessing how these processes are working. I like to start at the customer level and map their journey. Something as small as an extra click at a terminal can not only slow down a process but cost labor hours. In addition, it is beneficial to spend time meeting with everyone who touches the process along the way. It is amazing how much you can learn from a knowledgeable cashier who is touching the process a hundred times a day. The IT department is also a critical stop to understand what is possible and what pain points they have experienced with the different providers involved in the payments transaction flow.
Another step in your due diligence process is to determine what can change and when it can be changed. This is a great time to include any legal help you may need. Reviewing contracts may seem easy but involving someone with the proper background can help you develop options beyond one’s expertise. This is also the time to consider your necessary resources inside your organization to develop the plan. Many consultants have had the advantage of experiencing this process multiple times a year versus once every few years. Their insights could not only speed up the process but also help save your organization real dollars by leveraging their knowledge.
At this point, it is time to start thinking about what your end product will look like. Develop a mission statement for what the customer checkout experience should be once the strategy is implemented. How will your current metrics change as a result of the work you plan on doing? Refresh your transaction flow map to show what will change.
You are now fully armed to start making decisions regarding your processes. I recommend rating each current supplier on their effectiveness. Pricing is one of the elements but should not be the only aspect of effectiveness. Ability to innovate, response times, charge rates, and speed of transactions are all important criteria to evaluate as well. Developing a gap analysis to determine where your current processes may not be working is also critical. For instance, if you want to start routing your debit transactions to alternative networks, does your gateway or processor have all the capabilities you need to achieve the best results? If you wish to enable alternative payments, which products do your current providers support?
Another important factor to consider is any overlap in processes and whether those overlaps are beneficial to your business? For instance, supporting multiple acquirers may make a lot of sense if you are able to avoid down time or take advantage of specific transaction types. In other cases, you might find out your acquirer and gateway are performing similar functions resulting in additional time and money.
We have finally reached the point of documenting the roadmap to your new strategy. At this point, I find it very helpful to create a simple quad graph with one axis defined as ”level of effort” and the other axis defined as “benefit of change.” This should help you quickly identify those items with low effort and high benefits to prioritize first. It may be as simple as renegotiating a contract or starting an RFP process.
With your roadmap completed and your strategy outlined, next comes one of the most challenging steps in developing any strategy: securing internal alignment. As most organizations require buy-in from multiple stakeholders, achieving consensus can be difficult; however, the time spent understanding pain points and centering the strategy on the customer experience and following the outline above will help set you up for success . The key to gaining support is explaining how your strategy will help others achieve their desired outcomes resulting in a better overall customer experience.
While the steps outlined take time, and your desire is to immediately start making a difference, a well-defined strategy supported by all stakeholders will greatly increase your chance of overall success. In addition, a strategy will simplify responding to the many questions that arise throughout the year. For instance, when an email from the CFO about accepting cryptocurrency comes forward, you can refer to the strategy and respond that crypto acceptance would be dependent on a new gateway implementation or what otherwise would have to be adjusted in order to fit in such a project. The strategy helps everyone understand the tradeoffs and if the ROI of the new idea will replace one of those already planned for in the past.
If you are new to this process, I suggest your next step is to take the MAG’s newly released Merchant Payments 201 e-learning course on creating a payment strategy. This course will help you think through these steps while also giving you some valuable tools in creating an RFP or rating a supplier.