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Table of Contents

Lead Story

How to network like an industry leader - Part 2

News

Industry Update

EMV gets a boost from Obama

Does Apple Pay debut usher in new era of banking?

ISO lesson in PayPal's digital gaming domination

Record crowds turn out for industry shows

Features

Putting a positive spin on outsourcing

Making plans, taking action

All you need to know about Apple Pay

John Kiernan
CardHub

Mobile ecosystem expanding in all directions

Views

Mobile wallets: not quite ready for prime time

Patti Murphy
ProScribes Inc.

Education

Street SmartsSM:
Investing in partnerships

Tom Waters and Ben Abel
Bank Associates Merchant Services

Preparing your customers for EMV

Michael Gavin
Merchant Warehouse

Taming fires on the evolutionary road

Jeff Fortney
Clearent LLC

Company Profile

Alpha Payments Cloud

New Products

Tablet empowered merchants

Echo
Harbortouch

Loyalty building in a snap

Connect
EVO Snap

Inspiration

Do your waters run deep?

Departments

Readers Speak

Resource Guide

Datebook

Skyscraper Ad

The Green Sheet Online Edition

November 10, 2014  •  Issue 14:11:01

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Taming fires on the evolutionary road

By Jeff Fortney

My father was what we call today an early adopter. In 1963, we were the first house in the neighborhood to have a color television, and throughout my childhood he bought a new car every two to three years. He said it was due to the advances that came with each new model year.

In 1966, he decided we needed to buy a fire alarm system. In hindsight, I believe it was due to the sales pitch given by the salesman. The system consisted of four bells: one was at least 18 inches across; the rest were about six inches wide. They were silver and were in our house until I was a senior in high school. I have no idea if they worked because we never had a fire, so I never heard them go off.

I remember this purchase not because ours was the first (and ultimately the only) house with a fire alarm. I remember this because the salesman gave me a stuffed Smokey the Bear and told me the legend of Smokey:

Lessons from the front line

As I grew, I became increasingly aware of the nature of forest fires, which are truly devastating. They burn wherever the wind blows, consuming anything in their wake. The tall trees can and do often survive the blaze, but everything else is left in ashes.

Until the late 1970s, many felt that these fires were caused by negligence. Campfires not doused sufficiently. Carelessness with cigarettes. And the worst cause, those that were intentionally set. Thus the slogan was created.

However, forest fires are not a new phenomenon. During times of drought, when the tinder is very dry, one lightning strike can lead to a fire that can burn hundreds of thousands of acres. It is as if nature uses the fire to burn off the underbrush, allowing for new growth.

As people built houses near or in forests, forest fires have led to significant damage and, in many cases, complete destruction of residences. These situations led to laws regarding the building of houses in or near forests. These regulations include rules on keeping areas surrounding the home clear of any flammable material, natural and man-made. This helped reduce the amount of damage.

When he was right out of college, my nephew worked for the forest service fighting these fires. His tools were an axe and a shovel. When a fire started, his team would not approach the edges of the fire, but head to an area they anticipated the fire would burn. It wasn't their primary goal to put out the fire immediately, but instead contain it.

They would dig fire breaks in hopes that the fire would burn to the edge of the fire break and be unable to jump across. He would often light backfires, a fire that burned toward the forest fire, consuming the material that fed the fire. Ultimately the fire would burn itself out.

Applying firefighter tactics to payments

I had a conversation recently with an industry professional who said our industry suffers from fires just like these forest fires. Some are man-made, while others are the result of industry evolution. Man-made forest fires are usually caused by rumors and fear of change. Evolutionary fires are the result of the nature of our business. How we prepare and react to these two fire types may be the reason for survival.

Man-made fires are the simplest to address. The payments industry is one that has always rewarded those who stay ahead of change. As such, many fear anything that appears remotely capable of impacting their businesses. Today, this ranges from Europay/MasterCard/Visa to Apple Pay. Out of that type of fear, rumors begin.

Fighting a man-made payments forest fire requires that payment professionals become Smokey the Bear and focus on preventing fires. They must avoid rushing to get ahead of change until they know all the details. In fact, the best way to fight these types of fires is often to do nothing when they first come to light.

When a fear or concern arises, it's critical to obtain information first. Go to a trusted advisor for assistance, so the individual can educate you on the topic and share insights. Don't overreact. Instead, study the known facts. At that point in the investigative process, you will be in a position to act accordingly.

The evolutionary fire requires more effort, and above all, flexibility. The payments industry is ever changing. These changes come with opportunity if ISOs and merchant level salespeople choose to adapt. The key is to identify whether these fires are man-made or evolutionary.

Only act after you obtain all of the facts and determine the scenario represents real evolution, not rumors. Once you make that determination, examine whether the evolution impacts your business in any way. If the perceived impact will be minimal, you may not have to change the way you operate. If, on the other hand, it's significant, examine what steps you must take to address the change.

For example, if you determine that in your market tablet-based solutions will be in demand, take time to study the options. Find the one that best fits you and your partners, as well as the demands of your market, and put it in your toolbox.

In essence, control the fire with a fire break and back fire. You don't need to be an early adopter, but you do need to understand the product or technology and be prepared to address your merchants' questions.

Like the forest fire, an evolutionary fire brings new growth and new opportunity. Just make sure you are prepared for the change.

Jeff Fortney is Vice President, ISO Channel Management with Clearent LLC. He has more than 17 years' experience in the payments industry. Contact him at jeff@clearent.com or 972-618-7340. To learn about how Clearent can help you grow faster and go further, visit www.clearent.com.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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