Mercury News interview: Will Lansing, president and CEO of FICO
SAN JOSE, Jan 12, 2013 (San Jose Mercury News - McClatchy-Tribune Information Services via COMTEX) --
Will Lansing, president and chief executive of the data analytics company FICO, is moving the Minnesota-based global data company's headquarters to San Jose to help it tap into Silicon Valley's pool of technical talent.
Although its name is firmly associated with credit scores, Lansing says FICO's key strength is in extracting useful information from data to solve a wide range of business problems.
One of its core businesses is powerful credit card fraud detection software that screens transactions on two-thirds of the world's debit and credit cards. The data the company collects must be stored and analyzed and be available for recall in an instant. As powerful as that technology is, there's more to come, says Lansing, who believes that the analytics business is in a transition phase. He recently talked with this newspaper.
Q: Why the move
A: First of all, we're already here. A lot of our management is here, and our decision management tools business, FICO Blaze Advisor, is located in San Jose. And second, we want access to the kind of people we would like to recruit to operate our business -- the engineering talent, software talent, technical talent. There's a lot of it here, obviously.
Q: The statistics on what FICO's Falcon fraud detection software does are astonishing -- 9,000 credit and debit card transactions analyzed for their fraud potential per
second; 24 billion transactions a month. How is that possible
A: It starts with figuring out which data you need to pay attention to, because we live in a world where we're awash in data. A big part of analytics, at least the way we've historically practiced that business, is figuring out which data has value. It's really the only way to get to good real-time analytics
Q: So there's a lot of sitting around thinking
A: We have some brilliant analytic scientists on our payroll and that's what they do. They think, and they hypothesize, and they model, and they see how true the model is, and then they refine the model. And then we have these adaptive technologies where our models learn on the fly from the behavior of fraudsters.
Q: For example
A: For example, in credit card fraud, the fraudsters are very sophisticated. You build a model to detect fraud, and it doesn't take them long to figure out what you're looking at and find some other way to do it. A typical scenario with fraud is, they'll run a card at a gas station where they're not going be confronted by someone if it's bad. If that goes through then they go running off to Best Buy to get a TV set. Our
fraud detection algorithms detect this kind of pattern.
Q: Silicon Valley prides itself in being on the cutting edge. Now there's a buzz about "Big Data." How come
A: There have always been constraints on the storage and manipulation of the data. Now we're moving to a world where those things are becoming unconstrained. In the old world, there was tremendous pressure on trying to extract the most amount of data out of the smallest amount of data possible. In a world like that there's a tremendous premium on efficiency.
But we're moving into a world where we can store and manipulate greater volumes of data in real time. When you are in a world like that, suddenly there's new opportunity. We can now go out on the margin and get data that's not as predictive, not as valuable, but is more valuable than no data. That's really the world we're moving into with Big Data analytics. And we are at the forefront of that, so it makes sense for us to be tapping Silicon Valley talent to push that further.
Q: What's FICO doing in this new world
A: Everyone knows about FICO scores. That is aimed at identifying on behalf of our bank customers which consumers are likely to pay their debt. We've developed our reputation around it, and it still is a very important business for us. What we then did, is we moved into the software space. We said there's lots of more customized software opportunities for us to provide analytic insights, so we're going to build a software business. Over the past 20 years, we built a whole bunch of software products that help our customers make decisions about all kinds of different things. That falls broadly under the category of decision management. That's kind of our core skill.
Q: Are there markets you are targeting
A: Retail and health care are two places where we are expanding our business. That's one piece of our strategy. Part two of our strategy is to make all of our major products available as software as a service in the cloud. We're in the process of doing that.
And the third part of our strategy is to become the preeminent player in analytics on top of Big Data. That's a big statement, except that we already are a preeminent player in analytics in general. So as the world shifts to more and more Big Data, we want to maintain that strength. We're investing very heavily in analytics on top of Big Data today
Q: That comes back to the people, doesn't it
A: If there's one thing that we need to get right more than anything else, we need really, really smart people.
Contact Pete Carey at 408-920-5419. Follow him on Twitter.com/petecarey.
Five things you didn't know about Will Lansing
He's a trail runner and also competes in marathons.
He's an avid snowboarder.
He plays the piano.
His hobby is reading scientific journals.
He's a lawyer by training.
Born: New York
Work: CEO, president of FICO since January 2012; CEO, president of InfoSpace, 2009-2010; CEO, president of ValueVision Media 2004-07; partner, private equity fund General Atlantic Partners 2001-03; CEO, NBC Internet 2000-01
Education: Bachelor's degree, Wesleyan University; law degree, Georgetown University
Family: Married; three children
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