Electronic payment system management skills: don’t re-work the wheel

Time and time again, a lack of skilled workers is cited as the major barrier to business growth and future expansion in South Africa.

April 11, 2013

By Graham Williams, managing director of Stanchion Payment Solutions

Time and time again, a lack of skilled workers is cited as the major barrier to business growth and future expansion in South Africa. The fourth quarter of 2012 was no different, says Grant Thornton’s International Business Report. According to the report, 47% of business owners surveyed placed the skills shortage as their top growth constraint.

While stats like these may encourage companies to revisit hiring procedures and to put measures in place to retain skilled employees at all costs, we’d suggest an alternative tack. Particularly when the skills in question are highly specialised and mission-critical, such as managing your electronic payment environment.

This might seem counter-intuitive. Surely having your customers pay you for goods and services rendered is core to what you do? And you’d be mad to trust the management of this critical business process to anyone but a member of your own team, right?

Or maybe not.

Indeed, there are several very compelling arguments for trusting a payment management service to handle this management function for you. I’d argue this is the better way to quickly resolve any issues with minimum downtime, and to proactively sort out any potential issues before they bite you, and your profits and productivity.

In fact, your core business is not about taking payments for goods and services. Your core business is about providing the best goods and services – from loaves of bread to designer handbags – to making your customers happy and keep them coming back. However you need peace of mind that your payment environment is extremely efficient, effective and current. But why unnecessarily create the headache of building a team of payment solution ninjas to do everything from day-to-day maintenance and report running, to expert customisation, problem solving and trend spotting? Not to mention keeping abreast of local and international financial regulations, for example the on-going EuroPay, MasterCard and Visa (EMV) migration, and ensuring you continue to comply.

But let’s say you get this right and manage to build the skills in-house. It’s all very well until that staff member – or more likely, critical members of the team you’ve had to build – move on, taking their hard-won domain knowledge with them and leaving you back at square one.

Far better to entrust the management of your payment service to an expert management service, for this, and a range of additional reasons:

Access to wide skillsets
An outsourced supplier has a multitude of personality types to supply a range of skillsets to carry out a spread of tasks from the mundane but focussed daily maintenance and reporting, to highly specialised and advanced customisation, problem solving and compliance. It’s unlikely you’ll find one or even two candidates who can cover this breadth of requirements. Then there’s the small matter of hanging on to them in an era where two years is considered, by employees at least, to be far too long in a single role.

Benefit from wider knowledge
A well organised management service team works across a range of clients, and each one benefits from the learnings, experience, bug fixes and trends that happen in other environments. EMV is also a good example of this: this provides a foundation for fighting fraud and allows issuers to take charge of transactions at the point-of-sale. But using these tools to prevent fraud needs a deep understanding of the EMV standard as well as the systems within the transaction chain. Few companies have the resources to ensure complete control of the value chain.

Proactive management of your payment environment
The proactive management of a payment environment – spotting issues before they occur and preventing them – requires specific temperaments and a discrete set of processes, tools and skills. Technical problem solvers are unlikely to be satisfied tackling the day-to-day tasks required for high-quality proactive management. Again, this points to the spread of skills you require to achieve certain business outcomes.

Extend the value and the lifespan of your investment
With the right management, the value and lifespan of a payment switch can be dramatically extended, while decreasing the cost. But only if it is properly managed, with the right tools, processes and skillset and an eye on the future.

Outsourcing the management of your payments environment does not mean giving up complete control, however. Payments are a strategic asset which, if manipulated innovatively, can add significant competitive advantage to your business. Your payment management partner should provide you with strategic information about both payment industry trends and accessible business metrics relating to your payments environment and infrastructure capability. This is provided through a number of enabling channels including real-time mobile reporting. This will allow you to make and control the strategic decisions unique to your business case.

Nor does outsourcing mean you are going to get a one-size-fits all approach. A payment management service worth its salt will be able to incorporate any third party monitoring, reconciliation or other software you have already invested in, thus maximising your investment and giving you the nuanced reporting your industry requires.

It seems that South Africa’s do it yourself attitude is not serving companies well when they come up against skill shortages. Savvy companies realise that taking customer payments for goods and services rendered is probably not their core focus, and nor should it be. Rather, creating the perfect goods and services for your customers is your core focus, so far better to build and retain skills here, rather than in non-core, yet still highly mission-critical functions such as the management of payment switching.