A Case Made for a Chief Payments Officer

Surprise discovery, the positive kind, is one of life’s great pleasures. That moment it clicks, a blink happens or two, things change forever. Whether it’s a newborn seeing snow fall for the first time, an unexpected miraculous athletic feat or in my case, an informative webinar talking payments, discoveries are awesome.

The Times, They Are A Changing
It didn’t have a sexy title, How to Become the Chief Payments Officer (CPO), but what the informative webinar had was new thinking. It was an interview with Rene Pelegero a payments veteran whose work I’ve admired for years. He talked about why organizations need a payments leader, an evangelist at the strategic level to influence company direction. It was something I hadn’t considered but then it clicked, this discovery wasn’t original at all. Like seeing the remake of classic movie with 21st century content, I had been down this road before. Rene made total sense.

Twenty years ago, banks did most of the heavy lifting for an organization’s payments needs, now new players and technologies are disintermediating that legacy relationship. Then, payment methods were largely limited to what the bank offered but now, with over 250 different payment methods in existence and of that, 50% of all ecommerce transactions are non-card based – where just 15 years ago this would have been 5%, things have certainly changed. Businesses need to adjust to this new reality.

Managing Value with a Strategic Focus
For those not in the payments space, it’s easy to dismiss a transaction as just a transaction, it gets taken for granted all the time. Commercially it isn’t much better when a lack of centralized focus exists on the various platforms used to transact. Consider the following services that initiate payments but were never originally designed to do:
· ERP systems
· Order entry systems
· Booking
· Fulfillment systems

Those payments, the transactions, are the life blood of an organization. Greater control over its functionality should be a priority yet as it isn’t always. For any moves, adds or changes to a payment method, type, or service provider, an organization would need to engage 3rd party vendors. The upgrade wouldn’t happen overnight, nor would it be cheap.
Rene highlighted progressive companies who have created an end-to-end payments strategy based on a comprehensive payments-oriented architecture. He spoke of how these companies refine transactional flows like an oil refinery does crude. That ultimately, the CPO has three main functions; manage payment values, manage vendors and demonstrate these values to executives. Essentially, a cross-functional leader for the entire organization.

Learning from the Chief Information Officer’s Journey
It isn’t difficult to see similarities to the CPO journey; like the classic Spiderman movie’s remake to the striking Into the Spider-Verse that captured 21st century values. Or the Chief Information Technology experience where 20 years ago. Impacted by the emergence of the world wide web, the CIO was struggling to get executives to see the new opportunities and challenges they did. Ultimately their wish was granted, and the world hasn’t looked back. Only time will tell if history repeats for payment leader professionals.
What’s your experience running payments as a business? Are you getting the support needed? Is it even a consideration? Drop us a line, let’s chat.