ISOs can protect themselves from lawsuits and regulatory action by establishing uniform, documented sales training programs that follow sales-ethics practices, a sales-training consultant says.
That way, if questions arise in court or during investigations, ISOs can produce standardized training documents and test scores that demonstrate theyve taught salespeople ethical practices, says Mark Dunn, president of Hartland, Wis.-based Field Guide Enterprises LLC.
Its in an ISOs best interest to do this because it appears that the Federal Trade Commission is focusing a lot of attention on how cardholders and merchants have been treated by the payments processing industry, Dunn says.
Standardization teaching the same lessons to all salespeople and being able to prove it with written materials and test scores can prove essential when an ISO is compelled to prove its conveying the right information to the staff, he maintains.
Training should include instruction on providing merchants with accurate pricing, rates and fees, he says. Trainers should also emphasize that salespeople should not employ high-pressure tactics to close deals, Dunn notes.
Although most large ISOs use standardized training programs and conduct tests to make sure salespeople understand the lessons, many small and medium-sized ISOs take a haphazard approach to training, he says.
Smaller ISOs often delegate training duties to sales managers, leaving each one to develop his or her own approach, Dunn notes.
Very often, one training class will get information very different from another training class, he says.
Although those sales managers may qualify as expert salespeople, they may prove lacking as trainers, Dunn cautions.
Sales managers may leave out important information simply because its become second-nature to them and doesnt seem worth mentioning, he says. That could leave merchants uniformed about important aspects of their contracts.
Some managers might teach aggressive closing techniques that dont qualify as best practices, Dunn cautions.
Every salesperson and every sales manager has a production requirement, he says. The pressure is great to make your numbers.
That can give rise to bait-and-switch tactics like telling the merchant hes getting a low rate but failing to deliver on that promise, Dunn maintains.
Another ruse involves quoting a merchant a low rate on one type of card and failing to mention higher rates for most other types of cards, he says.
Most merchants cant figure out the statements theyre already receiving, let alone new statements from someone else, Dunn says.
The salesperson doesnt have time to explain the entire interchange methodology, but it is possible to give them a basic understanding of how the pricing works and how it compares, he contends.
ISOs should remember that most agreements with sales agents make the ISO responsible for what the agent does, Dunn says.
However, some ISOs have a sales-ethics agreement the agent signs and agrees to honor, he notes.
ISOs can also head off problems by checking the background of agents and members of their own direct sales staffs, Dunn says.
He uses the phrase, inspect your expectations to encourage ISOs to check up on salespeople, often by calling merchants to find out if the relationships progressing smoothly.
Some ISOs avoid that because they dont want to hear bad news, Dunn says.
But that attitude can prompt merchants to defect to another acquirer, he warns.
Dunn also lauds the Electronic Transactions Associations decision to create best-practices guidelines for the industry.
The ETA is a large enough organization that it can promulgate those as an industry standard, he says. There has been a discussion in our industry for 15 years at least about how we can curtail the activities of sales organizations that are not up to anybodys standards.
The entire industry could benefit from the guidelines, in Dunns view.
Honesty is the best policy certainly applies here, he observes.