How can innovation in payments be defined?
While there's certainly not one central answer to such a complex question, there are plenty of innovators and companies in the payments space who have their own proof of concept about what it takes to create the seismic shift the payments industry is undergoing. But to better understand the root of how that innovation happens, why it matters and who it's impacting, it means talking to the players involved in creating that change.
Meet Paul Bridgewater, CEO of Sage Payment Solutions. With over 25 years of experience in the payments industry, Bridgewater is leading Sage to develop innovative solutions that make it more convenient and secure for consumers and companies to do business, primarily through helping small and mid-sized merchants manage their cash flow more efficiently and effectively.
In the latest installation of our Commanders-in-Chief Series, Bridgewater offers an inside look at how Sage Payment Solutions approaches innovation, who it turns to for ideas to improve its products, and why payment innovation is underestimated and what can be game-changing for any small business.
PYMNTS: How would you define your company's approach to innovation?
PB: At Sage, putting the customer first is embedded into our DNA. So, it’s only fitting that our approach toward innovation is to immediately engage with our client base, and through them we ask, “What problems are we trying to solve?” This continuous feedback loop informs us along various points of the product development lifecycle.
For instance, what we are hearing most from our clients is the difficulty they have managing their money in real-time. These days, because of the many ways businesses can accept money, say at a terminal on the counter, through the Internet, over the phone or even off-site, they have funds coming in and at the same time they have expenses that have to be paid, payments to suppliers, say, or making payroll. Their main pain point, where they feel the most stress, is knowing, in real-time, their exact cash position. So where we are seeing the need to innovate most is finding ways to help them manage their cash flow more efficiently, making them what we call “cash flow confident.”
PYMNTS: What is the most innovative thing that you have introduced into the market — and what value did it deliver to the stakeholder group that was its target?
PB: At Sage, we are proud of all the ways we are harnessing innovation to add value to everyday lives of small and mid-sized businesses. In particular, our ERP and accounting software have tremendously expanded how these businesses work, no matter their size, to get paid, make payments to suppliers and employees and manage their cash flow that was once only available to larger corporations. For instance, we’ve developed “connected payments” which allows businesses to improve cash flow by automatically depositing every transaction into an ERP or accounting solution for instant availability, greatly reducing payment cycles. Plus, it reduces errors and saves time by eliminating manual or double data entry.
Of course, for every business the matter of managing money begins with actually taking payment for goods or services. At Sage we are also at the forefront of providing our clients secure and multiple ways to do just that. Whether it is at a terminal in a store, online or over the phone, or whether they are mobile payments, made with credit cards, loyalty or gift cards, Apple Pay, Android Pay, whatever, we are offering the latest payment technologies available to our customers.
PYMNTS: Where do you look for innovative ideas and why?
PB: If you look at a problem, there’s a word I use: “clunky.” We ask our clients “what is clunky that you come across in your experience, whether it is a process or merely an annoyance?” I look for opportunities to improve or add value around a chain of events. So when I start looking at innovation I look at the technology that exists within those steps and wonder if there isn’t a better, more efficient way to do that.
For me, it’s also what gets me excited. If I’m getting excited about it, I’m kind of thinking it is worth taking a deeper look and seeing if that innovative idea is something that is worth putting more time into and that is when you start exploring and see if it is really going to make our clients’ lives better.
PYMNTS: What do you think most people underestimate about innovative payments?
PB: They underestimate what is going on behind the curtain. They see a terminal and a card being swiped and think it is all just business as usual.
I’ve been in the industry over 20 years now and I think why we see so much innovation in payments today is because if you think about payments before mobility, payments were always tied to rails. When I talk about rails I’m talking about Visa, MasterCard, etc.
Today a business can do so much more around the rails. It can interact with a supplier or vendor, with a consumer outside of the traditional terminal, because now the terminal can be linked to the ERP and accounting software, whereas before that terminal was really the only interaction point. That’s extremely powerful and allows businesses to do their thing – do what they do best – which is delighting their customers every day.
PYMNTS: What person or company do you think "gets" innovation and why? Conversely, who or what has missed it and why?
PB: Everyone thinks that innovation has to be that brand new, spark of an idea, whereas actually the majority of innovation, the most successful innovations are just an iteration of an existing idea or technology and finding a way to engage with the customer.
Elon Musk, for example, in terms of Tesla. He didn’t invent the automobile, or the electric battery for that matter, and yet he is innovating the whole personal transportation model and even the way we think about storing and using energy. He saw what technology existed and found a way, through vision and persistence, to make it all accessible to the customer. In many ways it has always been that way. Ford did not invent the combustible engine, but his innovation, the assembly line, was a way to engage the customer, and changed the way people experienced the world.
I think the one that stands out that didn’t get innovation was Kodak. Kodak actually invented the digital camera, and yet that was the innovation that eventually did the company in. To innovate, but not have the ability to identify what that innovation would mean or what that innovation’s potential was, that is what killed Kodak.
PYMNTS: What advice would you give a young innovator in this space and why would you tell him or her to heed it?
PB: I think the classic advice is "no question is a stupid question." Ask lots of questions. Think through what it is but don’t spend too much time thinking. Sometimes you just have to give it a try. And if you give it a try and realize it is not working, don’t force it, if it happens it happens naturally and you will feel where it is the right thing to do. Get excited about, then if the first five or 10 people you talk to get excited about it, you are probably on to something.
Paul Bridgewater | Chief Executive Officer, Sage Payment Solutions
Paul Bridgewater serves as chief executive officer for Sage Payment Solutions, the payments division for Sage North America. He has nearly 20 years of experience and achievement in the international payments industry, spanning Europe and the Americas.
Prior to joining Sage in 2015, Paul was the group executive and general manager of global product and innovation for TSYS. He started his career working as an engineer in the United Kingdom, before joining Anker Data, where he held positions in product management and field service engineering. He then worked for the international merchant services business at NatWest Group.
Later, Paul joined Citibank and worked across Europe with roles in business development, product management, sales, and distribution. After five years at Citibank, he moved to the U.S. to serve as the senior vice president of global payment services for Digital River.
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