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Fair Isaac Corp. Idea Proposal

Fair Isaac Corp. Idea Proposal
 

Will FICO’s decision management platform transform the company into an analytics leader in the next 2 to 3 years?

Report Available: June 2, 2016

 

Blueshift’s initial research shows FICO continuing its efforts to become a leader in advanced analytics and broaden its business beyond credit scores, with its Decision Management Suite a key part of its strategy. The company recently released version 2.0 of DMS and announced a major deal with a telecom industry client. Overall it remains early days for the DMS platform, which combines business rules, optimization and predictive analytics. FICO faces stiff competition from larger software vendors like IBM, Oracle and SAS, but Blueshift’s Jan. 11 report found a big opportunity for FICO to use DMS to expand beyond its traditional core customers in financial services.

 

Observations

  1. FICO released Decision Management Suite 2.0 on April 26. The updated platform is aimed at being more user-friendly and allowing less technical users to model and execute business decisions without involving IT departments. Version 2.0 also includes a new tool called Strategy Director that FICO says will help users structure decision flows.
  2. FICO told investors during its FYQ2 earnings call on May 4 that a major telecom company had signed on to use its decision management tools in a deal worth “tens of millions” of dollars. Overall revenue in the company’s Application segment fell from the same period last year, mainly because the 2015 period included several large deals in its Fraud Solutions business. Revenue from FICO’s Scores division were up 22% compared to last year.
  3. Companies like IBM and Oracle that have well-known brand names and offer broader suites of enterprise software may have an advantage in the decision management space over FICO, which is still mostly known as a provider of credit scores to consumers and financial institutions. TIBCO and SAS are two of the other major players that offer significant sets of decision management tools.
  4. Blueshift’s Jan. 11 FICO report found that FICO’s Decision Management Suite had the company well positioned to capitalize on its reputation as a rules engine leader. Two sources believe DMS could allow FICO to be viewed as a software provider rather than just the top supplier of credit scores. Several others noted strong potential for FICO’s DMS to succeed outside of the company’s traditional “sweet spot” of financial institutions. In particular, newer, tech-savvy companies that do not carry legacy software relationships may be ideal targets for FICO’s DMS. One source championed a recent “humongous” deal FICO landed with a social networking company as evidence that this newer generation of companies presents ideal near-term targets for FICO’s DMS.

 

Does DMS have real potential to transform FICO’s business? How are companies learning about DMS and why are some choosing to use it? How quickly will others sign on? To answer these and other questions, Blueshift will issue a market research report by gathering data from independent sources in the following areas: Current FICO customers, Potential customers, Competitors, and Industry specialists.

 

Companies: FICO (FICO), IBM (IBM), Microsoft (MSFT), MicroStrategy (MSTR), Oracle (ORCL), Pegasystems (PEGA), Progress Software (PRGS)

 

Research Begins: May 16, 2016