Steve Chambers joined Visa Europe in 2005 to build a payment platform for Visa banks in Europe. This followed a decision to separate Europe from Visa in the US.
At the Gartner ITxpo conference in Barcelona, Chambers discussed the IT challenges at Visa Europe, getting management buy-in, new technology platforms and developing the right skills.
Separating Visa Europe from Visa Inc required a new IT system. On Friday 13th April 2007, with the system just live, and in the middle of a heated debate with the US alongside Visa Europe CEO Peter Ayliffe, Chambers took the decision to revert to the US system.
He said: "When I switched on the authorisation platform I was in New York, negotiating separation of Visa Europe and Visa US. I got a call to say the system was falling over. The operators could see the dials going red." The CEO backed his decision, even though it had taken six years to build the platform, fighting with the US all the way.
From such precarious beginnings, the platform is now mission-critical, highly resilient and fast, according to Chambers. He said: "It runs in two datacentres simultaneously." As such, the platform has achieved 100% uptime since 2008 and is processing more transactions than ever before.
“We processed one billion transactions last December – over the year it was 10 billion in total,” he said, adding that the authorisation volume increased from last year by 21%, to 10.7 billion.
The system can handle 1200 transactions per second, altogether 2500 messages per second. "No matter what volume the systems handle, we still only take 20 milliseconds at peak volume."
The technology platform
The hardware is based on a Sun Sparc platform with EMC storage. The platform uses modified disk read and write routines to ensure only the outer 30% of the disk heads are used to minimise response time. However, he adds that Visa Europe is likely to move to solid state disk (SSD) in the future. The network is a fully resilient BT MPLS private network combined with several back-up networks.
The application software is based on IBM software, along with significant in-house developed software. Visa Europe also uses proprietary security tools. Chambers said all sensitive data is rendered unusable by storing parts of the data on different physical platforms.
Following his decision to revert to the US system when Visa Europe's new system went live, Steve Chambers won the trust of Visa Europe CEO Peter Ayliffe.
Chambers said: "I meet the CEO every week and I have a good, open, trusting relationship. I am also on the executive committee."
Visa is a technology business so Chambers can get the systems he needs, whatever the cost. He said: "I can lose a datacentre, or parts of another datacentre, without a problem. But if we went down for five minutes, the queues in the big retailers would be out into the car park. The economic argument to ensure we have multiple layers of resiliency is easy to make."
However, Chambers added: "I do not speak to the board about IT. If they wanted to talk tech they would be in IT." Instead he talks about technology capabilities, at a high level, avoiding the need to get into the nitty gritty. He also the avoids the concept of IT/business alignment. "There is no IT without a business objective. So, the only place that Visa's role in terms of its technology provision matters, is between the consumer and merchant."
Visa Europe payment technologies
New payment technology is the headline investment space for Visa Europe. But alternative payment systems adoption remains quite small. By the end of this year there will be 30 million contactless cards across Europe, out of 430 million Visa cards.
Chambers said: "The use of payment systems is about ubiquity and consistency of experience." So if an individual bank chooses to implement near-field communications (NFC) at certain merchants, Chambers believes the customer experience is not a good one, as people may not wish to shop at those merchants. "You push your customers to choose to shop only where I have my terminals."
Instead, Visa's philosophy is to have a common standard, which means adopting technology and infrastructure is slow. But Visa is in a strong position. He said: "Every Visa bank adopts Visa standards and services. We have a huge push on NFC contactless payment and solutions in smartphones. We are spending tens of millions and hundreds of people are developing standards to push this out to everybody."
The company has also partnered with Monetise on a mobile payments system.
Data services at Visa Europe
Visa is in a unique position in its ability to track spending habits. Chambers said: "I see 22 billion records a year. I use that data to build fraud services, portfolio analysis for issuing banks and analysis from retail outlets to get economic insight in the market."
He said Visa is working very hard to deliver value back to retailers who want more efficiency in targeting offers and rewards to consumers. He said: "We can do segmentation of transactions such as finding out who are the high spenders or low spenders. We are starting to get to the point where we can pass real-time transaction data to a service broker."
This already happens in anti-fraud service, such as when a consumer gets a text message if their card is used. But Visa is looking to pilot a service for retailers in January 2012, which could be used to offer a 10% automatic discount to a consumer. He said: "There's a lot of work to do but we can provide the ability off the back of what we have built already."
Staff career development and investment in skills
Chambers believes that managing the career development of his staff is something all business departments find difficult. "The biggest challenge today, when it comes to delivering change for the future, is finding skills. We invest heavily in our people to take chances."
But Chambers added: "It is quite difficult to do career development. It is all about the individual. I never thought for a minute I would be in IT, after my degree." Chambers believes managers need to offer a semi-formal approach to help people develop. He said: "Ultimately it is an individual's choice."