Third, the information systems implications also need to concentrate on how to manage pricing and discounting across product groups and also across payment methods. This is an area where small businesses can gain significant competitive advantage and one that is consistently ignored or not undertaken at all. For the payment card strategies in small businesses to be profitable, information systems, specifically applications, need to be created and managed to ensure optimal pricing is defined for each product, and that gross margins are maximized regardless of the payment card used.
Fourth, information systems in small businesses need to take into account the synchronizing of all available distribution channels, creating a multi-channel management strategy that is integrated to the payment card processing system as well (Goldstucker, Moschis, Stanley, Thomas, 1986). Tracking transactions and margins by channel is one of the main metrics that small businesses use to evaluate their overall selling and marketing performance. Multi-channel management was once a strategy that was available onto to the largest enterprises, yet in the small and medium businesses combining Web-based sales, direct, and indirect selling strategies need to have an accompanying payment card processing platform available for accepting, processing and transferring payments (Stone, Hobbs, Khaleeli, 2002). In one respect payment card processing systems are leveling the playing field of multichannel management, due partially to the development of payment card systems oriented to the small and medium business.
Fifth and most significant, the need for a consistent approach to the security of customer information is critical. This is the area of information systems that intersects the development of the payment card industry standards (Sussman, 2008). The development of database systems that can encode, protect yet create taxonomies of customer data that can be used as the basis of marketing campaigns is a critical component of how information systems can be designed to ensure a payment card system is successfully implemented in a small business. Not only is the security of transaction crit8ifcal, even more critical are the customer records and accumulated purchase activity of small businesses' customers. This type of data is the critical link the small business has with its most loyal and potentially profitable customers. Considerations with regard to the use of information systems for security aren't just relegated to the back office of a small business however; it also has to do with the approaches used for capturing customer data, completing and recording transactions, and the development of plans for ensure a high degree of security compliance across the entire order capture and transaction recording process (Swartz, 2007), There are significant implications in Business-to-Consumer (B2C) commerce for example when payment cards are used over the Internet and the need exists for authenticating the card user's identity and credit worthiness (Chen, Lee, Mayer, 2001). The process workflow that begins with payment and ends with the transaction being verified through the acquiring bank over a credit card network requires that the systems in the small business have secure integration points to the network first, and second, have a sufficiently high level of security at the business itself. On this latter point, the adoption and the Payment Card Industry Standard (Sussman, 2008) has specifically targeted the lack of information systems security in small businesses.
In summary, the information systems impact of implementing a payment card system in a small business is equally balanced between integration of accounting, transaction-based systems on the one hand and the security of the databases that are used for accumulating customer purchasing history and specifics of their purchases. The emergence of standards in these areas specific to security show that to date the value chain of when a transaction first occurs to when it is catalogued or recorded in a database is full of potential security breaches. Sassman (2008) points to these data and identity breaches as the catalyst for security standards becoming progressively more stringent and specific in their requirements.
Legislative and Regulatory Issues
As the card process industry has steadily matured and faced single-digit growth rates (Sun, Tse, 2007), there has been a corresponding consolidation of the overall market. There were mounting concerns of financial institutions not being able to overcome economic fluctuations in addition to a maturing financial services industry forcing a high level of mergers and acquisitions (M&a)....
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