The Frictionless Path To Innovation

Innovation can be a difficult journey, especially in the ever-changing and complex payments landscape. But for Mike Keegan, Chief Executive Officer of TNS, the key to successful and meaningful innovation starts with a practical approach and building a culture that not only embraces innovation, but cultivates it from within.

PYMNTS: How would you define your company’s approach to innovation?

MK: Our approach is realistic. We follow a straightforward guideline: any innovation must be simple and frictionless. The payments industry is highly complex, so new innovations should reduce complexity and be painless for our customers to adopt. Further, the innovation should either solve an existing problem or provide scalable advancements for market participants.

By following our guideline, we are focused on adding value by delivering solutions that address market needs and are designed to seamlessly fit with the networks, systems and solutions already in place globally.

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?

MK: We are typically asked by our customers to provide solutions that allow them to extend the reach of their products and services. Along these lines, we have recently launched our Global Wireless Access solution in the U.S., Europe and Asia. This multi-carrier roaming SIM solution provides secure and reliable payment-specific wireless connectivity in over 150 countries. Simply, the service allows the wireless payment terminal to attach to the strongest wireless signal at all times, which helps mitigate single carrier blackspots and outages.

The service includes our Roam+ terminal application that provides automatic network selection based on the performance and availability of the wireless carriers. Global Wireless Access adds much needed reliability to wireless terminal deployments and enhances the operation and management of terminal fleets for processors and acquirers. The service includes numerous valued-added features, including the pre-activation and bulk activation of SIMs, and has been adopted by many of our customers who have activated over 500,000 payment-specific SIMs around the world that we manage on their behalf.

PYMNTS: Where do you look for innovative ideas and why?

MK: For us, innovative ideas typically arise from two sources, our customers and our employees. The primary focus of our business is to work with our customers to address ever-evolving challenges in the payments industry. By understanding these challenges, we are able to work with our customers to develop flexible, reliable and secure solutions that they can implement without any friction.

Also, our employees, who have deep experience and tenure within the payments industry, see the daily challenges that all of our customers face and are able to use this knowledge to develop best-of-breed solutions that can be implemented across our customer base to address industry-wide challenges.

PYMNTS: What do you think that most people underestimate about innovating in payments?

MK: One common misconception is that innovation happens quickly, when in reality it takes time. The payments ecosystem is complex, with many differing protocols and standards that can lack the flexibility to support new ideas easily. Bringing a fully developed solution to market involves extensive work and interaction with many industry participants whose motivations/needs may differ. From “light-bulb” moment to market is a longer and more difficult journey than most people realize.

PYMNTS: What person or company do you think “gets” innovation and why – and, conversely, who or what has missed it and why?

MK: Many people are quick to assert that innovation principally comes from new market participants who are more flexible and lack complex infrastructure while innovation lags at more established companies, such as banks, processors and acquirers. I personally don’t agree with that assertion. I believe that market disruptors challenge the more established players to embrace innovation. I also believe that innovation results from the culture within a corporation.

Companies which are good at innovation build cultures where all employees understand that innovation is part of their jobs and that failure is an important step in the process of building successful products and services. A good example of this is MasterCard. Over the past few years, MasterCard’s CEO, Ajay Banga, has changed the perception of MasterCard by focusing the company on technology and innovation, which, I believe, has changed the culture within MasterCard. In the payments industry, you will find innovative ideas emerging from market disruptors as well as established players.

PYMNTS: What advice would you give a young innovator in this space and why would you tell them to heed it?

MK: I believe to innovate you need to take the time to understand the payments ecosystem. This understanding will allow a young innovator to identify niche areas where innovation is truly needed, such as security and faster payments. It will also force a young innovator to answer the “how” question, which is the most important part of innovation (not the idea). I have seen many ideas falter because the innovator didn’t understand that the environment couldn’t support the new product or service (and the cost of change was too high).

When innovating, always: (1) try to solve a real problem (solutions looking for a problem rarely work), (2) be realistic and practical (you don’t need to disrupt the entire system to be successful); and (3) be committed early in the process to understanding how you will implement your idea (exposing your idea to the tough questions that can potentially derail its success may just ensure its survival).

Michael Q. Keegan

Chief Executive Officer, Transaction Network Services

Mike Keegan is the Chief Executive Officer of Transaction Network Services, Inc. Since joining TNS in 2001, Mike has been a driving force behind the company’s expansion into more than 60 countries, the development of the company’s operational processes, and the evolution of the company’s solutions, which are used today by participants in the payments, telecommunications and financial services industries to deliver billions of mission-critical transactions every year across the Americas, Europe and Asia Pacific regions.

During his tenure, Mike, with the senior management team, has identified and completed acquisitions that have enhanced TNS’ expertise and market leading position and undertaken numerous financings that have supported these acquisitions as well as strengthened the company’s financial position. Most recently, Mike was part of the team that negotiated the going-private acquisition of TNS by Siris Capital, a private equity firm, in February 2013 and the sale of TNS’ Payment Gateway services to MasterCard in December 2014.

Prior to becoming CEO, Mike held a number of positions at TNS, including President, Chief Operating Officer and General Counsel. Mike has served on numerous company and association boards and currently serves as a director of the CTIA – The Wireless Association.

Prior to joining TNS, Mike held senior positions at the Internet Partnership Group and, prior to that, practiced law at LeBoeuf, Lamb, Greene and MacRae L.L.P.

Mike is based at TNS’ corporate headquarters in Reston, Virginia and holds a Bachelor of Arts degree from The University of Notre Dame and a Juris Doctorate from The University of Virginia School of Law.

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