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Name Andrew Yueyang Cao
NetID acao971
Group Number: 185
Website Link:
Tutorial Details
Tutor: Day: Time:
Olivia Schultz-Duffy Wednesday 9am
Time Spent on
20 hours Word Count: 1649


People in the 21
century carry many cards in their wallets. To name a few cards people
such as yourself may carry, there are loyalty cards, membership cards, credit and debit
cards, identification cards and the list goes on. We believe that there are too many cards in
peoples wallets and this has become a problem that affects everybody. Generally, wallets
do not provide a sufficient number of slots for each card to have an individual slot.
Consequently, many people lose their cards from double slotting, in which they place more
than one card in each slot. The Exec’ Card combats this problem by intergrating multiple
cards of your choice into a single card. Ultimately, reducing the number of cards in
customers wallets.
3.1 Vision
Our vision is to be a company that customer can rely on. To lend a sholder or a helping hand
and share some of the stress and fustration of our customers. To be the only card cutomers
will ever need. To be the only card that customers will ever be in their wallets.
3.2 Industry Analysis: Payment Card Industry
Industry: Payment Card Industry.
Force: High/Low: Justification:
Buyer power: Low Buyer power is low as there are very few
businesses, such as Coin, that provide a similar
product that provide a similar service as ours.
Therefore, customers cannot influence prices to
be discounted. (Coin, 2014)


Supplier power: High Supplier power is high as there few suppliers,
such as Paymark, who possess a large payment
network as it is extremely expensive to develop
and implement. (Webster, 2014)
Threat of new entrants: Low Threat of new entrants are low as the cost of
creating partnerships with banks and Paymark on
a domestic scale will be extremely expensive.
(Venture Navigator, 2010)
In addition, the cost of investing in the
development of a payment network such as
VISA’s is expensive and impractical to replicate.
(Webster, 2014)
Threat of substitutes: High Threat of substitues are high as there are various
ways to pay for goods and services such as with
cash, cheque, credit and debit cards. (Webster,
Rivalry among existing
Low The rivalry among existing competitors is low as
there are few card companies that provide a
payment service through a large payment
network. Paymark alone processes approximately
75% of all electronic transactions in New Zealand.
(Paymark, 2012)
Overall attractiveness of the industry: The payment card industry is difficult to enter due to
the high cost barrier. However, the industry is very profitable as it has a low risk of new
entrants and rivalry.


3.3 Customers and Thei r Needs
Our customers are individuals who are independent in terms of their finance and in their
day-to-day lives.
After conducting some research we discovered that an average person carries 17 cards in
their wallets (newslite, 2012). From a survey we conducted with randomly selected students
from the University of Auckland, we found that the majority of students carried more than
one wallet. This is a clear indication that we have too many cards and not enough slots in a
single wallet. Therefore, we believe customers need a single card that provides all the
services of their existing cards. Ultimately, reducing the number of cards from 17 to 1.
3.4 The Product and Service
The Exec’ Card has been developed to solve the problem of having too many cards in
people’s wallets. It allows the customer to select which cards they desire to have
intergrated into the Exec’ Card. This may include customers choosing to intergrate all their
credit and debit cards into the Exec’ Card. In doing so, this decreases the number of cards in
the customers wallet. Hence, avoiding the need to double slot and reducing the risk of
losing cards.
3.5 Suppliers and Partners
One of our suppliers/partners will be Paymark, which is New Zealands leading payments
provider. Their involvement is vital as they will provide the necessary payment network for
the Exec’Card to be able to perform the payment feature, equivalent to that of a credit or
debit card.
Another partner are large banks, such as ASB and BNZ. For the payment feature to operate,
we require partnerships with multiple banks which will synchronise and align the Exec’ Card
to the customers bank accounts.
3.6 Strategy: Differenti ation
The Exec’ Card is unlike any other card, hence, it is unique. Meaning that an aspect of our
strategy is differentiation. It has been developed to perform all the services of the cards you


would expect to find in a individuals wallet. It aims to carry out payments exactly like your
credit or debit card, Auckland Transport cards and serve as a form of identification.
Therefore, the Exec’ Card is a broad strategy as it is able to perform a variety of services.
The overall strategy is therefore Broad differentiation.
3.7 Value Chain Activity: Service after sale
The most important value chain activity is the service after sale. This is considered to be the
most important as it is tightly linked to our broad differentiation strategy and our vision of
being reliable. In order to be the only card customers will ever need in their wallets, we
must ensure that the variety of services the Exec’ Card provides are operational. Problems
that will hinder the daily lives of our customers caused from the malfunction of the Exec’
Card must be delt swiftly to display the we care for our customers and that they are our first
and upmost priority.
3.8 Business Processes
3.8.1. AUTHORIZATION PROCESS – The authorization process begins when the customer
swiped or scans their Exec’ Card at the terminal. The transaction will be sent to either a
high-volume or high speed server, depending on the terminals priority. The transaction is
translated into a format that is compatible with the processor in the payment gateway. The
transaction is then delivered to the processor which directs each transaction to the
appropriate bank. However, the transaction message will first go to our business database
to check if the card has been reported stolen or missing. When the transaction message
reaches the bank, they will check if the customer’s account has available credit or balance. If
the bank deems that customer will be able to pay, an authorized message will then be
backtracked to the terminal as an agreement to pay the amount owed (Merchant Link,
2014). The transactional recording department will record all transactions with a transaction
recording system.



Start: Customer
swipes Exec’ Card at
Terminal translates
transaction message
into appropriate
format for
Route each
transaction to
appropriate bank or
Send transaction
message to issuing
card company
Has this card
been reported?
Issuer checks
customers account
for available credit
or balance.
Can the
customer pay?
Send “Authorized”
message back to
Hand over goods or
service to customer.



3.8.2. SETTLEMENT PROCESS – The settlement process begins when businesses send one
batch of settlement requests containing the sales amount of the day. The batch is sent to
the processor through the payment gateway. The processor organises the transactions in
the batch and routes them to the appropriate bank as a settlement record. Once these
records are transmitted to the banks, the specified amount of funds will move from every
cardholder’s account back to the processor. The processor then deducts the collected funds
from the total batch amount sent and deposits the funds into the businesses account
(Merchant Link, 2014). This transaction of funds will be monitored by the accounting
department with an accounting system to calculate the outstanding accounts receivable.

Merchant tallies
final sales amount
Sends the batch to
the gateway.
Gateway sends the
batch to the
Processor sorts the
transactions in the
Send all
transactions to
appropriate card
company, bank or
Transport funds
from cardholders
account to the
Deduct the acquired
fees from total
batch amount.
Deposits funds in
merchants account.


3.9 Functionalities
 Route transactions to appropriate banks and institutes
 Record and report all transactions
 Transfer funds to merchants accounts
 Record and report all transactions
3.10 Systems

3.10. 1. ACCOUNTING SYSTEM – The accounting systems is uses to accurately calculate the
oustanding accounts recievable during the settlement process when the funds are collected
from the respective banks. This is important as we must ensure businesses are not under or
over paid from their daily sales or services. This is directly linked to our businesses vision of
being reliable.
3.10. 2 SECRURI TY SYSTEM –We pride ourselves in being a reliable and taking away a share of
our customers stress. To accomplish this vision, customers must have complete faith that
their personal details are safe. The security system is to ensure that the personal details of
our customers, such as their transactions and bank accounts details are absolutely
confidential and secure.
3.10. 3. TRANSACTION RECORDING SYSTEM – The transaction recording system records all the
transactions that the the Exec’ Card performs, resulting in a history of transactions. This
supports our businesses vision of being reliable as it will grant our business with the ability
to provide accurate and reliable information about customers transactions to answer and
relieve their concerns and queries if they were to ask.


3.11. Summary Table: Value Chain to Systems

Value Chain
Processes Functionalities Specific Information
Broad Information

after sales
1. Authorisation
1. Route all transactions to appropriate
banks and institutes.

2. Record and report all transactions.

Secure access system

Transaction reporting system

Decision support system

Transaction processing

2. Settlement
1. Transfer funds into merchants account.

2. Record and report all transactions
Accounting system

Transaction reporting system
Transaction processing
cheese system

Transaction processing


In conclusion, the Exec’ Card is an achievable innovation as it uses existing information
systems and information technolgy to perform its services, thus there is no need for
extensive modification to existing infirmation systems and information technology.
Therefore, the release of the Exec’ Card will prove to be of high value in the payment card
industry and a worthy investment of time and money as it will ultimately minimise the
number of cards in wallets and lower the risk of losing cards.

1. Merchant Link. 2014. Credit Card Processing 101: Payments & Industry Players.
Retrieved from

2. hellobee. 2013. How many cards do you carry in your wallet?. Retrieved from

3. Venture Navigator. 2010. Barriers to Entry. Retrieved from

4. Webster, K. (2014, March 17). Michael Porte’s Five Forces and Payment Innovation.
pymnts. Retrieved from

5. Paymark. 2012. Our Company. Retrieved from

6. newslite. (2012, September 17). Retrieved from

7. Coin. 2014. Retrieved from