The Future of Business: A New Engagement Model
Using decision making technology to master the modern business landscape
Imagine standing at the edge of a digital renaissance, where every technological leap redefines how we live and work. Just as explorers once navigated uncharted waters, businesses today must chart a course through an ocean of rapid innovation and shifting consumer demands. At FICO World 24, our customers seized the opportunity to delve into the future of business, exploring innovations and tackling the complexities of the modern landscape. From the rapid acceleration and application of artificial intelligence in business and its growing presence in global consciousness to the pivotal role of data-driven insights, the event illuminated the path forward for those ready to embrace change.
It's not just about reacting to change but proactively steering transformation to better engage customers. Embracing evolution and strategic foresight is crucial for navigating this dynamic landscape. Attendees explored strategies to harness new technologies, streamline operations, and foster a culture of continuous improvement to stay competitive.
Revolutionizing Customer Connections: The FICO Platform Advantage
A key highlight of FICO World 24 was the unveiling of groundbreaking enhancements to the FICO Platform, aimed at revolutionizing customer connections and redefining how businesses engage with their audience. At FICO, our mission is to deliver best-in-class Applied Intelligence to power these connections, fulfilling our commitment to innovation and excellence.
In today’s world, customers are no longer just talking to people in your organization. They're not just calling your salespeople or visiting the store; they're also using apps, websites, search engines, chatbots, and text messages. All these interactions are powered by your standard first-generation CRM, which fails to keep up with real-time demands.
FICO Platform transcends these traditional customer relationship management software limitations by offering dynamic, prescriptive, and contextually aware solutions. This allows businesses to deliver personalized experiences at scale, fostering collaboration and breaking down silos to build meaningful customer relationships. The platform's ability to provide real-time, situation-relevant insights ensures that every customer interaction is optimized, enhancing satisfaction and loyalty.
Our CEO’s Vision for FICO and its Evolution
During my fireside chat with FICO CEO Will Lansing at FICO World, we discussed our company’s evolution and unwavering commitment to our core vision. Will emphasized how FICO's clarity of purpose—applying analytics to data for informed decisions—has driven our success. By operationalizing analytics, we ensure data-driven decisions are seamlessly integrated into business processes. This approach keeps FICO at the forefront of innovation, helping organizations optimize every customer interaction through comprehensive data utilization and advanced analytics. Our discussion also touched on the future of AI and its role in enhancing decision-making processes, emphasizing the importance of responsible and ethical AI deployment.
Unveiling the Industry's First API Marketplace: Pioneering Innovation
Another exciting development at FICO World 24 was the announcement that we are building the industry's first API marketplace for decision management. This groundbreaking initiative is set to revolutionize collaboration and innovation, serving as a hub for discovering and sharing new software and services across the business lifecycle, and providing a platform where customers can post and share their own solutions.
With agility and shared expertise at its core, the API marketplace fosters a culture of collaboration, driving unprecedented innovation and meaningful change in business operations. Companies can now leverage a diverse network of partners to access cutting-edge tools and resources, enhancing their ability to respond to market demands and innovate rapidly. Stay tuned for further news around this in 2024.
Embracing the Future with Confidence
As we look to the future, FICO remains committed to pushing the boundaries of what is possible. The enhancements to the FICO Platform and the launch of the API marketplace are just the beginning. By leveraging cutting-edge technology and fostering a culture of collaboration, we empower businesses to meet the ever-changing demands of their customers.
Let's see how far we can go by next year!
Learn How FICO Platform Can Power Your Digital Transformation and Boost Collaboration
Explore how FICO Platform can revolutionize your digital transformation by providing AI-powered customer insights and enhancing collaboration.
Explore innovation with FICO Platform: Discover how our AI-driven analytics can meet and exceed customer expectations through real-time, end-to-end solutions.
Watch the video “FICO® Platform: Applied Intelligence, when and where it matters”: Learn how our AI-powered platform delivers crucial insights at every stage of the customer journey.
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See customers discuss their use of FICO Platform: Hear firsthand how user-friendly and insightful the platform is, analyzing every interaction to optimize the customer experience.
Read the article from The Journal of Digital Banking, “How Financial Services Leaders Are Using Enterprise Intelligence to Optimize Efficiency Ratios”: Explore case studies and insights on how AI-driven analytics are transforming financial services.
Watch FICO Platform in action with the story of your everyday consumer, Digital Jane: Follow Digital Jane's customer journey to see how real-time data and analytics enhance every user interaction and deliver exceptional customer-centric experiences.
With the FICO Platform, you can analyze customer data in real-time, meet evolving customer expectations, and optimize every end-to-end interaction in your organization.
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FICO® Score High Achievers: Is Age the Only Factor?
<p>FICO’s latest research on <a href="http://www.fico.com/en/blogs/risk-compliance/us-credit-quality-rising-the-beat-goes-on/" target="_blank">national FICO® Score distribution</a> shows that US credit quality continues to trend upwards, with an increasing number of consumers scoring in the highest scores ranges. Given that, we decided it was time to refresh our study on “<a href="http://www.fico.com/en/blogs/risk-compliance/infographic-what-does-a-high-credit-scorer-look-like/" target="_blank">FICO® Score high achievers</a>,” where we examine the credit behavioural profiles of consumers with higher credit scores.</p> <p>As expected, our latest study showed that older people generally have higher scores, as has been the case in our <a href="http://www.fico.com/en/blogs/risk-compliance/age-before-beauty-credit-worthiness-before-youth/" target="_blank">past research</a>. This is largely because they have trade lines that have been open longer, which leads to higher scores (assuming the trade lines are in good standing and all other things equal). The most credit savvy among you will remember that length of credit history accounts for roughly 15% of the overall <a href="http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx" target="_blank">FICO® Score calculation</a>.</p> <p>But for younger consumers, it isn’t too helpful to say, “just wait until you are 50 years old, and that will fix things!” Thus, I decided to dive deeper with our analysis, including looking at the credit behavioural characteristics of younger consumers with high FICO® Scores.</p> <p>In this analysis, I looked at credit characteristics for the two highest score bands, 750-799 and 800-850, which have about 16% and 23% of the population, respectively. I further broke this down by looking at the characteristics of the youngest 15% in each group, which occurs at age 29 for the 750-799 group and 43 for the 800-850. We used FICO<strong>®</strong> Score 9 for our analysis, and examined typical variables of the categories that go into the make-up of the score.</p> <p><a href="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png"><img class="alignnone size-full wp-image-29367" src="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png" alt="fico-score-high-achiever-table" width="715" height="747" /></a></p> <p>Since there’s a lot to dissect in this chart, I’ll highlight a few findings that struck me: <ul> <li><strong>Credit history.</strong> Higher scores are undoubtedly associated with a longer time on file. What’s striking is the higher average time on file for the 800+ group, both overall and for revolving accounts (the most common trade line). Clearly, it helps to start credit use early in life – but that’s not the sole determining factor for high scoring. The younger cohorts in both the 800+ and 750-799 groups have time on file medians significantly less than their older counterparts.</li> <li><strong>New credit.</strong> High credit scorers do, in fact, pursue new credit. We see little variation in months since last trade line opening and last inquiry among all groups observed.</li> <li><strong>Pay on time.</strong> As you might expect, the further in the past the delinquency, the higher the score – and that’s <u>if</u> a delinquency ever happened. 95% of the 800+ people and 72% of the 750-799 group have never been delinquent, which is a striking contrast to the 57% for the total population. The percentages for the younger groups are even higher, especially so for the 750-799ers. Collection items are also scarce for these high scorers. While 23% of the national population have collection items greater than $99, the figures are only 0.5% for the 800+ group and 3% for the 750-799 group. It is clear that, in conjunction with starting a credit file early, paying on time is a key trait of the FICO® Score high achiever.</li> <li><strong>Balance and utilization.</strong> Finally, we look at how credit is being used, focusing on revolving product use. (Since most people only have one mortgage or one auto loan, variation in instalment product figures is minimal and driven by payment history, which is near perfect for high scorers, as we’ve seen.) FICO® Score high achievers tend to have more open revolving accounts. While the % active trades and utilization are generally lower, by no means do high scorers avoid the use of credit products. What drives the difference here is the amount of <u>available</u> revolving credit utilized. The 800+ group is roughly 1/4 of the national median, both in total and on their highest utilized card; they also have lower balances and more cards<em>. </em>The 750-799 group is more active and higher utilized, but still only at 2/3 of the national figures. The young 750-799 group compensate with lower revolving balances and, as a result, lower utilization, which is in line with what we see for the 800+ group.</li> <li><strong>Benchmarks.</strong> I’d like to point out that while this study provides good benchmarks of the typical credit traits of the FICO® Score high achiever, individual credit profiles will vary widely. And keep in mind that when we sort groups of consumers as a whole by different behaviours, some results may look superficially odd. For example, the 800+ band has a longer median average open account time (128 months) than average revolving months on file (140 months).</li> </ul> So, what do we conclude? A huge takeaway is that high scorers don’t have too much in the way of serious delinquencies and negative public record data.</p> <p>In most respects, the young 800+ people are like their peer group. They really only differ markedly in their shorter credit history and higher non-mortgage balance, both of which are a function of life stage. Our results show that you don’t have to be a credit product hermit; these high scorers have more credit cards. The takeaway is to start credit activity early and maintain well-managed and moderate usage.</p> <p>In many ways, the young 750-799 people are more interesting because their age profile is much younger. Their credit characteristics differ more from their peer group, particularly in terms of length of credit history. They compensate by having almost pristine credit records and lower balances.</p> <p>Ultimately, 39% of US consumers are FICO® Score high achievers, which they accomplish by following common-sense credit practices. It ain’t rocket science!</p>
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