Pollack: What are your top IT priorities over the next 12 to 18 months?
Ritchie: While we continue to invest in new products, platform modernisation and meeting developing regulatory requirements, we are significantly increasing our investment in the digital area.
The digital landscape is evolving rapidly and is a key focus for American Express in markets around the world. The investments we are making include capabilities in mobile, social media and location based services.
Pollack: As an executive with a regional remit, what are you seeing as the emerging trends across Japan, Asia Pacific and Australia, New Zealand?
Ritchie: Mobile, social, location based services and cloud are currently all important trends in technology. I also expect voice to text, the Internet of things (e.g. connecting everyday household devices to the Internet) and augmented reality to emerge as significant enablers over the next three to five years.
Each of these areas individually provides a platform for innovation but the combination of all these together will have profound implications for the development of new capabilities and services.
Pollack: Last year American Express launched a US$100 million fund to invest in digital commerce start-ups. What is the ultimate aim of the strategy, and what have been the major investments impacting your region to date?
Ritchie: The digital commerce initiative was designed to help identify and develop innovative technologies that will help accelerate American Express’ digital transformation and strengthen connections to a growing base of customers around the globe.
The digital commerce initiative, which is being driven out of the US, will look to make investments in companies focused on serving critical parts of the digital commerce experience, including loyalty and rewards, mobile and online payment management, fee-based services, security and fraud detection and data analysis.
We are in the early stages of the initiative and have not yet announced any investments.
Pollack: Technology giants such as Google have begun making major payments plays. How do you see these new entrants transforming the electronic payments landscape?
Ritchie: There are certainly many players trying to crack the code for next-generation payments and services, Google being one of them. Digital payments is going to be an evolution rather than a revolution with a lot of players, traditional and new ones, looking at this space.
We each bring different strengths and weaknesses but I feel good about what American Express is offering with Serve in the US and China. We think of Serve as a network rather than a wallet, and are focused on the idea of an account in the cloud with an offline capability that can be used today anywhere American Express is accepted.
The truth is nobody knows at this point how well the concept of a ‘mobile wallet’ or NFC will sit with consumers and many people feel uneasy about the idea of a central database collecting information about them.
In the end, it’s really about customer trust and transparency. People want to be tech-savvy, but when it comes to their money, they want to know they’re safe and secure. It’s taken American Express 160- plus years to build a brand of trust and loyalty. This doesn’t happen overnight.
Pollack: American Express’ Serve platform has a unique feature allowing customers to create sub-accounts for various payment types. What features do you envisage for future iterations of Serve?
Ritchie: Serve will begin to realise its full potential as we begin adding features that move Serve from a payments platform to a true enabler of digital commerce. These new applications include offer capabilities, with offers and deals that are personalised to the customer, including notifications if these offers or deals are nearing expiration.
We’ll also add money management tools, which will give customers the ability to pull all their financial data through the Serve interface. They can then use Serve to budget, set financial goals, and benchmark progress relative to peer groups. We also anticipate integrating loyalty programs and other virtual currencies.
Pollack: American Express has recently partnered with Twitter for the ‘Sync, Tweet, Save’ campaign. What do you consider to be the key elements in engaging younger customers, such as Gen-Y, through social media and technology?
Ritchie: We want to be where our Cardmembers are; and increasingly that is online and in social platforms like Twitter. The ‘Sync, Tweet, Save’ campaign which launched in the US earlier this year is an excellent example of the type of digital innovation that American Express is focusing on.
It provides our US card members with a discount and helps to promote participating merchants. Younger customers are typically avid users of technology and there is a great opportunity to engage them through social media and technology.
The key elements to this are being authentic and engaging, delivering relevant and appropriate offers and respecting customer privacy preferences. It’s also important to note that the effect of ‘customer word of mouth’ is magnified in the context of social media.
Pollack: What do you see as the next significant step in the evolution of Near-Field Communication (NFC) technology?
Ritchie: There are a number of approaches being pursued to enable NFC technology. Some of these are likely to be only an interim step, such as the use of SD NFC cards in mobile phones.
Once clear, globally inter-operable standards have been developed, we can expect to see NFC capabilities built into smartphones and this will help drive adoption of mobile payments. Other pre-requisites for adoption are the deployment of NFC readers at the point of sale and a change in customer behaviour from swiping a card to waving their phone.
Customer take-up is likely to be encouraged by providing special offers or discounts which can be redeemed when using their mobile device to make a payment.
Pollack: Recent research by Gartner has predicted payments via mobile devices to increase by 76 per cent worldwide this year. What do you see as the future for the traditional plastic credit card?
Ritchie: Mobile payments are in the early stage of adoption. The underlying technology exists but the standards and business models are still evolving. Once these barriers are overcome, I expect that we will see a rapid increase in the use of mobile devices for making payments.
However, it will take a long time for mobile devices to fully replace the traditional plastic credit card as demonstrated by co-existence of chip, magnetic stripe and embossing on cards in use today. That said, I think people like having a physical card and I think there will be some people who will always want one.
Pollack: How do you encourage technological innovation from within the organisation and; how do you determine which ideas will be pursued?
Ritchie: We are very keen to encourage technology innovation from within the organisation and have pursued a number of complementary approaches to facilitate this.
Broadly these fall into three areas: investing effort in educating our team members on digital developments and teaching them how to innovate; making innovation a more explicit part of everyone’s role; and using incentives such as competitions to encourage team members to innovate and recognising and rewarding innovation when it happens.
We have already seen a significant increase in the contribution of innovative ideas as a result. The decision around which ideas to pursue is based on team member input and leadership judgement on the feasibility and impact of the idea.
Pollack: Every IT leader, particularly at your level, has a legacy they wish to be remembered for. What is yours?
Ritchie: I’ve been privileged in my career to have contributed to some major innovations such as BPay and BPay View in Australia, but what I’m most proud of as a leader is the teams that I have built and the people that I have developed.
Looking back on my career so far, my greatest satisfaction has been gained from the people I have had the privilege to work with and watching them go on to bigger and better things.
