ISO Strategies
Part TWO

How The Acquiring Business Can Put a Certification Regime in Place
by Harold Montgomery

   Teamwork is a word you hear frequently, and rarely see in action. Is your company a collection of individuals or a coherent team working together towards a common goal? And what about our industry? Do we cooperate when we should, and compete when appropriate? Or do we carry the win/lose mentality of competing everywhere we go? When it comes to salesman certification and training, we can all benefit by a cooperative effort.
   An industry standard salesperson training and certification regime would help everyone in our business in a number of ways. First, it would give us all some defense against the rogue salesman or company using unacceptable sales tactics in the field. Second, it would allow sales professionals in our industry to distinguish themselves with credentials that can be earned, measured and recognized. Third, certification would give merchants some reassurance that the person they are dealing with and the company with which he/she is affiliated subscribe to a high quality standard. Fourth, vendors, equipment makers and the card associations would have a way to measure and grade ISO performance. In the end, certification gives us all another point of competitive differentiation we lack today.
   Certification measures are really a way of changing the discussion in our industry away from price and toward other measures � such as service quality. For too long, our industry has measured itself on one success criterion only � the number of merchants in the portfolio � or some variant of that number. For example, ISO's often describe their company in terms of the dollar processing volume their merchant portfolio generates monthly. This is an interesting number to know, but only vaguely suggests the gross revenues of the ISO, and sheds no light at all on whether that ISO is a successful (profitable) business. It's time to move toward new measures of success in our field, like this one � what percentage of your merchants would sign up with your company again given the choice between you and a competitor? Would your merchant customers rate your salespeople as having high, medium or low product knowledge?
   For our industry to recover from and move beyond the CMS disaster, we all need to change the success measures in the business from raw merchant count to a more complete standard including our professionalism. But how do we measure these intangibles? One way to start is by ensuring that the people who work in our companies are at least trained, tested and certified to a minimum universal standard. Another key step would be to ask that all of our companies' practices be accredited by an outside third party.
   How do we put such a testing and training program in place? First, industry leaders would need to come together to agree on a few basic principles:

  • Any testing and certification regime would have to be voluntary. We cannot force anyone to participate, but those who do not would be left behind and would over time become uncompetitive in their markets.
  • The regime would have varying levels of certification based on knowledge, experience, and objective accomplishment measures. This provides sales recruits with the vision of a career in our business, not just a job to tide them over between other assignments.
  • The certification regime must be available to all in the industry equally.
  • The ISO organization itself, not just the salesperson in the field, should be accredited for good business practices and training procedures. ISO's should be required to renew accreditation on a set interval of at least once every five years, if not more frequently. It has always been surprising to me that VISA, among others, so protective of its brand, allows virtually anyone, with any level of product knowledge and training, to represent its services in the merchant marketplace. It should have been VISA cracking down on CMS, not the FTC.
  • Each program, whether training and certification or ISO accreditation should be demanding. No one will respect a weak training and testing process.

   Card associations, processors and even terminal manufacturers have an incentive to create and implement a certification system for their own benefit. Each would want to create an incentive advantage of some kind for ISO's who become certified. Preferably, this advantage would be something that the ISO could pass along to key salespeople and the merchant customer. This advantage in turn, would create a real competitive advantage in the marketplace.
   Market and industry leaders will need to take the first steps. Creating a concept, designing a program and gaining industry buy-in from key players will probably take a year or two. Any credible effort will need to involve parties as diverse as the Electronic Transaction Association, major processors, the card associations (including Amex, Discover, Diner's Club, etc.), major ISO's, the Federal Trade Commission, lawyers who understand the issues, and others. It's not a small job, but then what worthy goal is?
   Any program worthy of implementation will probably take two years to put together. It will have to be sold to each constituent party in an ongoing campaign which clearly articulates the benefits of certification. Initially, a committee would take responsibility for creating a certification program. Then, with the outline in hand, they would have to go to key industry players and sell the concept.
   Over time, most of the industry will adopt a standard certification regime which supports a quality approach.
   A high quality approach to certification and training would be the basis of a new evolution of the industry. Our business is in a state of fundamental change � from a period of dynamic growth in which sales capacity determined the winners, to a new world where quality and service delivery and quality will be the new determinants of success. It will soon no longer be sufficient just to offer credit card services at the lowest prices � that approach is already unsustainable as it is, leading to ever shrinking margins, suspicious merchants, dubious sales practices, outrageous turnover of salespeople, and in the end, a broken business model for ISO's. The foundation of that business model is the presumption that merchants will not deal with any person or entity who does not give the lowest possible price. Nothing could be farther from the truth. Experienced merchants value service delivery and will pay for it. It's up to us to give them a reason to do so, and they will respond. Show the world your standard of quality and watch what can happen.