TLDR: Using the Six Sigma LEAN process on your payment processing system can help reduce cost and ensure the longevity and ROI of your merchant account.
”Business as usual” is often used like the best/normal/desirable solution but can we improve this statement? Have you ever heard of the LEAN process? What does it mean and how can we apply it?
Long Story Short
If you have heard about Toyota – then you know about the impact of the LEAN process. In the middle of the 20th century, this concept appeared in Toyota’s Production System. It is based on the philosophy of defining value from the PEOPLE, and I am referring for the customers and employees.
LEAN = Purpose + Process + People
You can apply the LEAN process for every activity – for example when you are cooking at your home – look over the process and see if there are things that could be done faster, better, or if that are things that can be eliminated.
The same principles apply to your payment processing system. Look at your workflow now, identify your steps, implement simplicity, eliminate activities that are not productive, make your payment process easy for the customer, and productive for your business. Regularly checking your processing activity, outsourcing your chargeback response and alerts to a reputable vendor, and reducing fraud with 3D Secure should all be a part of your process. By following the LEAN process, you can build your payments system to withstand chargeback spikes, reduce loss from friendly fraud and ensure the longevity of your merchant account.
From my point of view, LEAN process instruments that can be easily adapted to your process flow are :
- Check in meeting
- Feedback session / Coaching session
- Weekly meetings
Let’s take a quick look:
A check in meeting refers to a day to day morning meeting that can help you and your processing system by having a quick look at your goals for that day. Let’s say that today you want to find out the source of your chargebacks – find it and save it on the white board.
Take your feedback from your customers after they are buy your product – create a NPS (Net Promoter Score) that can help you see where your strengths and weaknesses are. Are your customers satisfied with the presentation of your product? Is your customer satisfied with your checkout process? What do they think of your customer support?
A weekly meeting gives you the opportunity to see how your business performed last week by checking the results, and also offers you the opportunity to plan the next week. For example, you can look at that customer feedback and how your NPS is trending, and correlate that with the decisions and actions you made. After examining the results, you can now plan what you will do over the next week.
Using the LEAN process will help you eliminate or minimize WASTE, increase productivity & customer satisfaction, improve the quality of your work, reduce cost and in the end improve your profits.
When high risk processing is our day to day business we get in touch with different situations/countries/owners/business types/products and much more. The most consistent request I see is “I need more processing volume”. You can’t always treat issues like this with direct actions. LEAN helps us to take that overall view of the business and gives us a process by which to make the right decisions. Make your payment processing system generate value for you and for your customer. Take LEAN ideas and adapt them to your processing system.
If you are in a ‘high risk’ business, like nutraceuticals, you always have to:
- Analyze your statements – manage your chargebacks – see alerts, impact, Return On Investment (we will have an article based on this subject)
- Use 3D Secure
- Take care of your MID because it is the lifeblood of your online business
You can prepare the plan and action from a well organized business that has a LEAN process in place. Of course you have to work on your SOP (standard operating procedure) and the PLAN / DO / CHECK / ACTION methodology. Think about how your process can be improved. Are there any steps that can be done more efficiently? If you need help implementing LEAN with your payment system, feel free to contact us.