Join Ed McLaughlin, President & CTO, Mastercard who speaks about the digital first organization, leadership, building teams, and innovation.
00:00 00:00:03,640 --> 00:00:05,360Welcome to CIO Leadership Live.200:00:05,360 --> 00:00:09,640Lee Rennick, Executive Director,CIO Communities for CIO.com300:00:09,720 --> 00:00:12,760I'm very excited to introduceand welcome Ed McLaughlin,400:00:12,760 --> 00:00:15,760President and Chief TechnologyOfficer, Mastercard.500:00:16,000 --> 00:00:19,800Ed, please introduce yourself and tell usa little bit about your current role.600:00:19,880 --> 00:00:22,320Certainly. Hello Lee, so good to see you.700:00:22,320 --> 00:00:27,000So I run technology for Mastercardand it probably the two favorite things800:00:27,000 --> 00:00:30,960I have about my job is it singlerunning day, the global network900:00:31,040 --> 00:00:34,160security, the transactional systems,all the other services1000:00:34,160 --> 00:00:35,640we provide to the customer.1100:00:35,640 --> 00:00:38,880Really what what Mastercarddoes as a technology company.1200:00:38,960 --> 00:00:41,960But the other side is what we becomeis what we built.1300:00:42,000 --> 00:00:44,800So we also have all the tech modernizationand the things that we're doing1400:00:44,800 --> 00:00:46,560to advance the state of the art.1500:00:46,560 --> 00:00:50,040So it's a great job where every dayyou make sure all the things that need to1600:00:50,040 --> 00:00:51,160happen are happening1700:00:51,160 --> 00:00:54,680while you're still planning on whatwe build and what we're going to become.1800:00:54,760 --> 00:00:57,440And I love this dialogabout talking about Mastercard1900:00:57,440 --> 00:00:59,760as being a technology company,so I'm really interested2000:00:59,760 --> 00:01:03,040in getting into some of the talks topicswe'll be talking about today, Ed.2100:01:03,120 --> 00:01:05,160And I appreciate you joining us very,very much.2200:01:05,160 --> 00:01:06,520We've really created this series2300:01:06,520 --> 00:01:10,280to support the technology leaderin their own tech and career journey.2400:01:10,360 --> 00:01:13,360So the first question and I asked thisto everybody I'm interviewing,2500:01:13,360 --> 00:01:16,360can you please tell us a little bitabout your own career path2600:01:16,360 --> 00:01:19,080and maybe provide some insightsor tips on that road path?2700:01:19,080 --> 00:01:21,400Are there any lessons learnedthat you'd like to share?2800:01:21,400 --> 00:01:23,720I was talking to my daughterabout this recently,2900:01:23,720 --> 00:01:26,760and when I left university,I went straight into programing3000:01:26,760 --> 00:01:28,920because I thought at the timeI could have a challenging3100:01:28,920 --> 00:01:31,800and rewarding careerand not have to talk to anybody.3200:01:31,800 --> 00:01:33,480So my first advice is whatever3300:01:33,480 --> 00:01:37,200you think's going to happen in your careeris'nt pretty much what's going to happen.3400:01:37,280 --> 00:01:41,920But I've always been at this intersectionof technology3500:01:41,920 --> 00:01:47,880and commerce, technology and finance,and my early career had a set of start up3600:01:47,880 --> 00:01:51,960organizationsthat were in electronic data interchange.3700:01:51,960 --> 00:01:54,720We had a data modeling companythat we took public3800:01:54,720 --> 00:01:58,200at a first wave Internet paymentsbusiness, and I think all of those things3900:01:58,200 --> 00:02:01,520came together and led me to Mastercard,where I was privileged to be part4000:02:01,520 --> 00:02:06,000of that management team that came in asMastercard was getting ready for our IPO.4100:02:06,080 --> 00:02:09,440We originally started as a association,as a service provider4200:02:09,440 --> 00:02:11,200to the banks that owned us.4300:02:11,200 --> 00:02:13,920And in 2006 we went public as a company.4400:02:13,920 --> 00:02:16,600It's just been an amazing storysince then.4500:02:16,600 --> 00:02:20,520And I think like many technologyleaders, you're constantly bringing4600:02:20,520 --> 00:02:24,720those experiencesyou've had together for what happens next.4700:02:24,720 --> 00:02:29,000And you know, all the work we didto enable things like digital and mobile,4800:02:29,040 --> 00:02:30,160mobile payments,4900:02:30,160 --> 00:02:33,720all the things we've continued to doto extend the network, it's really based5000:02:33,720 --> 00:02:36,720on that skills and understandingyou build across your career.5100:02:36,720 --> 00:02:38,720Well, I appreciate you sharing that.5200:02:38,720 --> 00:02:40,880And you know, obviouslyyou've worked in a sector5300:02:40,880 --> 00:02:44,560that's had to pivot dramaticallyover the last few years as well, too.5400:02:44,560 --> 00:02:47,000And obviously, as you mentioned,first being a service provider,5500:02:47,000 --> 00:02:50,720then to being a public company,I mean, that's a huge transition.5600:02:50,720 --> 00:02:53,680So I'm really looking forwardto having some of those discussions.5700:02:53,680 --> 00:02:55,920And I want to segueinto the next question,5800:02:55,920 --> 00:02:59,560which is to talk about Mastercardand the global reach of the company.5900:02:59,640 --> 00:03:03,040You know, I met I know many CIOs,and I've just been at two conferences, one6000:03:03,040 --> 00:03:05,160in the UK and one in Canada,and we've been talking6100:03:05,160 --> 00:03:09,080a lot about data, datasovereignty, cyber cybersecurity,6200:03:09,160 --> 00:03:13,120but also really creating that meaningfulproduct for the customer around the globe.6300:03:13,120 --> 00:03:16,760So could you talk a little bitabout your strategies as a business leader6400:03:16,760 --> 00:03:21,520around building that global organizationfor business and customer engagement?6500:03:21,600 --> 00:03:22,960Many things are so important.6600:03:22,960 --> 00:03:25,920First,you have to be where your customers are.6700:03:25,920 --> 00:03:29,600You have to reflect and understandyour customers, and it's always a risk6800:03:29,680 --> 00:03:31,920that you're doing really wellin one corner of the world6900:03:31,920 --> 00:03:35,880and you think all of those patternsapply somewhere else in the world.7000:03:35,960 --> 00:03:38,840So I really think of our technologyand in two ways7100:03:38,840 --> 00:03:42,400there's certain elements of technologywhich are truly transcendent,7200:03:42,480 --> 00:03:46,760a high speed you know, incredibly reliablebackbone to our network.7300:03:46,840 --> 00:03:48,840You know, the ways that the transactions7400:03:48,840 --> 00:03:52,120and messages flowbecause they all have to work together.7500:03:52,200 --> 00:03:55,400So you make certain investmentsto make sure those transcendent things or7600:03:55,400 --> 00:04:00,040those overall things are globallyscalable and unbelievably good.7700:04:00,120 --> 00:04:03,320But then you have to recognizethe only things that are meaningful for7800:04:03,320 --> 00:04:07,920people are how it works in their life,in their neighborhood, what's for them.7900:04:08,000 --> 00:04:10,440So if you can marry those globally8000:04:10,440 --> 00:04:13,440scaled capabilitiesthat everyone wants and needs8100:04:13,560 --> 00:04:17,880and make it profoundly meaningfulfor merchants running their business8200:04:17,880 --> 00:04:21,440in that neighborhood, for consumersliving their daily lives,8300:04:21,520 --> 00:04:25,280for financial institutionswith different needs around the world,8400:04:25,360 --> 00:04:28,120so that that 16 digit Mastercard number8500:04:28,120 --> 00:04:32,240I have works exactly as well as Manhattanas a 168600:04:32,280 --> 00:04:34,320digit Mastercard numberthat we're providing8700:04:34,320 --> 00:04:38,680to customer and financial inclusion, who'snever been part of the financial system8800:04:38,760 --> 00:04:40,600as we help bring that online.8900:04:40,600 --> 00:04:42,520So that's really how we balance it.9000:04:42,520 --> 00:04:46,200So we have tech hubs around the worldwhere we have people who are working9100:04:46,200 --> 00:04:49,600in the markets with the technologiesin which the customers there9200:04:49,680 --> 00:04:53,320and we connect themor knit them together on a global basis.9300:04:53,400 --> 00:04:55,320I think it's also important9400:04:55,320 --> 00:04:58,720because, you know, proudlywhat we do is really important.9500:04:58,720 --> 00:05:02,120We're regtech. So we work in9600:05:02,120 --> 00:05:05,240210 different countriesand regulatory domiciles.9700:05:05,240 --> 00:05:10,080We have 150 different currenciesthat we have to transact in and enable9800:05:10,160 --> 00:05:14,080and those requirements inand how those requirements are changing9900:05:14,160 --> 00:05:17,360and how that impactsthe overall technology footprint we have.10000:05:17,360 --> 00:05:19,440It's one of the biggest topicsof our time.10100:05:19,440 --> 00:05:21,600It must be incredible,just as you describe it.10200:05:21,600 --> 00:05:23,480I mean, having been at a conferencein the UK10300:05:23,480 --> 00:05:26,520and talking to some of the CIOsand leaders there from global companies,10400:05:26,520 --> 00:05:29,080they were talking about how they'redealing with their data in the cloud10500:05:29,080 --> 00:05:32,120and you know, howthey're almost having not to silo it,10600:05:32,120 --> 00:05:34,760but have a global plan,but then make sure their data isn't in10700:05:34,760 --> 00:05:37,920one country in the cloud the right wayand it serves the customer in the company.10800:05:37,920 --> 00:05:43,120So it just must be so much more amplifiedin the business that you're in.10900:05:43,240 --> 00:05:44,400Well, there's a lot of things11000:05:44,400 --> 00:05:46,440we've been thinking about that,and you're exactly right.11100:05:46,440 --> 00:05:48,480We have regulatory obligations.11200:05:48,480 --> 00:05:50,360You have the tech that new technologies11300:05:50,360 --> 00:05:52,320that you want to be ableto take advantage of11400:05:52,320 --> 00:05:56,840consumers' demands are shifting entirelyas we're replatforming our lives11500:05:56,840 --> 00:06:00,600into this digital physical convergence,which is unlike anything11600:06:00,600 --> 00:06:02,280that we've had before.11700:06:02,280 --> 00:06:05,080So a couple of big parameterswe put around this.11800:06:05,080 --> 00:06:08,400One ofwhich is you talk about about cloud.11900:06:08,480 --> 00:06:10,320We had to take a view that12000:06:10,320 --> 00:06:14,200we're not quite sure where we're goingto be allowed to run. In some countries12100:06:14,200 --> 00:06:18,080regulators said you had to runin equipment you fully controlled12200:06:18,320 --> 00:06:21,040because of national critical infrastructure.In others12300:06:21,040 --> 00:06:24,560we can take advantage of third partyor public cloud compute.12400:06:24,640 --> 00:06:27,600And it's not too hard to seein the future12500:06:27,600 --> 00:06:32,280certain markets may say you have to runin a given cloud environment.12600:06:32,360 --> 00:06:34,560So when we looked at that,you take a step back12700:06:34,560 --> 00:06:37,560and say you want to have really wellbehaved applications.12800:06:37,680 --> 00:06:41,320So the view we took islet's have a global network fabric12900:06:41,400 --> 00:06:45,480where our private cloudand our public cloud are peered entities13000:06:45,480 --> 00:06:49,240within it and we can choosewhere to deploy our applications.13100:06:49,320 --> 00:06:51,720It's a lot harderfrom an engineering standpoint,13200:06:51,720 --> 00:06:56,000but if you get that right from thebeginning, you're ready for those things13300:06:56,000 --> 00:06:57,680you don't know quitewhat's going to happen13400:06:57,680 --> 00:07:00,320but have to be able to anticipate now.13500:07:00,320 --> 00:07:03,040And the second big trend we're seeingis not only13600:07:03,040 --> 00:07:07,640where you have to operate and runlike where you put your compute,13700:07:07,720 --> 00:07:10,400data and the rules around data13800:07:10,400 --> 00:07:15,480have become such a topic of concernand opportunity.13900:07:15,560 --> 00:07:18,040And we'll I'm surewe'll get to conversations around AI14000:07:18,040 --> 00:07:21,040and all the amazing benefitsyou can get from your data.14100:07:21,200 --> 00:07:25,040But that's the other thing is our abilityto say exactly what data we're getting.14200:07:25,120 --> 00:07:29,840Making sure that data enters our networkinside the regulatory domicile14300:07:29,840 --> 00:07:33,720that it belongs to and then knowingwhere we're processing it.14400:07:33,800 --> 00:07:37,760These are really hard problemsand having that understanding,14500:07:37,760 --> 00:07:41,920so the long term goalof having a global network14600:07:41,920 --> 00:07:44,400with an intelligent edgethat meets our customers14700:07:44,400 --> 00:07:47,520exactly where they're doing businessand then being able to know where14800:07:47,520 --> 00:07:51,640within that we can put servicing, computeand persistence.14900:07:51,720 --> 00:07:53,400It's the foundational architectures15000:07:53,400 --> 00:07:57,160you put in place today, and then we'll seehow that plays out over time.15100:07:57,240 --> 00:08:00,760But the idea of being able to controlwhere, what15200:08:00,760 --> 00:08:04,120and how you're using data in a waywe've never had to before,15300:08:04,200 --> 00:08:06,240I guess is going to be the storyfor the next decade.15400:08:06,240 --> 00:08:07,800Thank you so much for sharing that.15500:08:07,800 --> 00:08:09,520I mean, I'm just my head is going.15600:08:09,520 --> 00:08:13,080Yes, no, I'm just listening alongand just thinking about the complexity15700:08:13,080 --> 00:08:14,200of what you have to deal with.15800:08:14,200 --> 00:08:16,080And we didn't plan for thisquite that question.15900:08:16,080 --> 00:08:18,360But it must be just so valuable tofor your clients,16000:08:18,360 --> 00:08:21,480because I'm sure as you're learningand we just had a panel last week16100:08:21,480 --> 00:08:25,160at a conference with the serviceprovider and Cloud and, you know,16200:08:25,240 --> 00:08:27,160they're talking abouthow they're really working16300:08:27,160 --> 00:08:29,760with their clientsand to help understand this.16400:08:29,760 --> 00:08:32,800So it sounds like you probably havethat same thing in place.16500:08:32,800 --> 00:08:36,680And, you know, I'm just going to pop overto the next question here because16600:08:36,760 --> 00:08:40,920during the pandemic, of course, you know,I'm sure you had to pivot and design,16700:08:40,960 --> 00:08:42,520you know, different programsthat you just spoke16800:08:42,520 --> 00:08:46,440about around cloud and reallyto support the changing digital economy.16900:08:46,520 --> 00:08:50,080I spoke to a CIO here in Canadaabout his brand, and he said,17000:08:50,080 --> 00:08:52,480you know, the dayafter they closed their bricks and mortar17100:08:52,480 --> 00:08:58,360stores, their online orderingincreased by 2,400% every day, every day.17200:08:58,360 --> 00:09:00,960And I was like,oh my gosh, how did you manage that?17300:09:00,960 --> 00:09:04,600So I would imagine with Mastercardthat just multiplied up17400:09:04,600 --> 00:09:07,000with all the people in the vendorsusing your card.17500:09:07,000 --> 00:09:08,960So you talked a little bitabout that, right,17600:09:08,960 --> 00:09:12,160already running your cloud solutions,but just how you manage that as a leader.17700:09:12,160 --> 00:09:16,800And then obviously you touched on as wellthat global financial inclusion17800:09:16,800 --> 00:09:18,120globally that you're working on.17900:09:18,120 --> 00:09:21,880So I would love you to talk a little bitabout both of those things.18000:09:21,960 --> 00:09:25,360Let me start particularlybecause this is a leadership series18100:09:25,440 --> 00:09:30,600and the way we dealt with the pandemic, it started with,and all came down to our people.18200:09:30,680 --> 00:09:33,520And one of the challengeswere the blessings and the burdens18300:09:33,520 --> 00:09:37,160of being a Mastercard is we dorun national critical infrastructure.18400:09:37,240 --> 00:09:39,360So we had no opportunity to shut down.18500:09:39,360 --> 00:09:45,200We had to throw switches and pull cablesand you know a letter from the Treasury Department18600:09:45,200 --> 00:09:47,440saying whateveryou have to do to stay open, stay open.18700:09:47,440 --> 00:09:52,600So we had special considerationsfor how we had to operate through,18800:09:52,680 --> 00:09:54,960which really recquired a lot of,18900:09:54,960 --> 00:09:57,360let's say, risk and sacrificeon behalf of our staff19000:09:57,360 --> 00:10:02,640to come in during that time,which was such great uncertainty. And19100:10:02,720 --> 00:10:04,920one story I haveto tell because we all talk about sense19200:10:04,920 --> 00:10:08,080of purpose, sense of mission,it's important for our organization.19300:10:08,160 --> 00:10:12,000But when you realize we've got over3 billion accounts on our network19400:10:12,080 --> 00:10:16,680that people need to buy medicineto get the food for their kids19500:10:16,680 --> 00:10:17,400to do what they have19600:10:17,400 --> 00:10:21,400to do for businesses to stay in business,we need to be there for them.19700:10:21,480 --> 00:10:23,320So one of the things we did iswe weren't sure19800:10:23,320 --> 00:10:26,800if we had challenges in our operationsor in our control center.19900:10:26,880 --> 00:10:31,560So we took everyone who had workedthose jobs within the last three years20000:10:31,640 --> 00:10:34,640and we asked them to come inand work a shift.20100:10:34,680 --> 00:10:38,720So if we needed them, almost like areserve, you'd call them up and come in20200:10:38,800 --> 00:10:41,800and every person said yes.20300:10:41,880 --> 00:10:44,960So the way we were able to come through it20400:10:44,960 --> 00:10:48,480so well really did come down to thatsense of purpose, mission and dedication,20500:10:48,480 --> 00:10:51,640because people understandtheir jobs are important.20600:10:51,720 --> 00:10:53,240And that's exactly what we saw.20700:10:53,240 --> 00:10:53,880We you know,20800:10:53,880 --> 00:10:57,600people always talk about, you know,massive acceleration is coming forward.20900:10:57,680 --> 00:11:00,440We were seeing a long term shiftof a couple percentage21000:11:00,440 --> 00:11:04,360points a year from the physical worldto the digital world.21100:11:04,440 --> 00:11:08,600When the first quarter of full pandemiclockdowns globally happened,21200:11:08,680 --> 00:11:12,000we had that crossoverwhere we had more digital transactions21300:11:12,000 --> 00:11:13,720than you would see in the physical world.21400:11:13,720 --> 00:11:16,720And that behavior has persisted.21500:11:16,720 --> 00:11:19,520So it was a massive accelerationof the business.21600:11:19,520 --> 00:11:21,200So that's where all those things, you know,21700:11:21,200 --> 00:11:24,400I don't think exactlyhad global pandemic in their plans,21800:11:24,480 --> 00:11:25,760but the ability to say21900:11:25,760 --> 00:11:28,920how much reserve capacityyou had, how much of a burst can you have,22000:11:28,920 --> 00:11:33,000how can you expand what you doif there's unintended consequences?22100:11:33,080 --> 00:11:35,600All of that planning came to the fore.22200:11:35,600 --> 00:11:39,160And for us, when you move from a digitalto a physical world,22300:11:39,240 --> 00:11:42,520you know, the iconic Christmas salewhere the lines around the corner.22400:11:42,560 --> 00:11:46,680Yeah, I always say in the digital worldthey all hit us at once and nobody's22500:11:46,680 --> 00:11:48,720queuing up. It's all coming at you.22600:11:48,720 --> 00:11:51,920So we did a lot of work to add capacityto anticipate22700:11:51,920 --> 00:11:53,840and stay ahead of that demand.22800:11:53,840 --> 00:11:57,120But I really do say,and I always say for anything you do22900:11:57,120 --> 00:12:00,280as a technology strategy,it really is coming down23000:12:00,280 --> 00:12:03,200to a people strategyand their commitment and dedication.23100:12:03,200 --> 00:12:04,160And I think that's what23200:12:04,160 --> 00:12:07,480for many organizationsI've talked to so many organizations,23300:12:07,560 --> 00:12:10,920that's what really shone through thatvery, very difficult time for all of us.23400:12:11,040 --> 00:12:12,480I really appreciate you sharing that.23500:12:12,480 --> 00:12:15,680That must have just been suchan intense time, but tough to you know, so23600:12:15,680 --> 00:12:19,680many CIOs right now are talking aboutfocusing on people and their people,23700:12:19,680 --> 00:12:21,400even when it comes to cloudand everything.23800:12:21,400 --> 00:12:24,680The way we manage data,the way we manage these transactions.23900:12:24,680 --> 00:12:29,080But you know, what a phenomenal strategyto have24000:12:29,160 --> 00:12:31,840and to have that kind of commitmentfrom your people.24100:12:31,840 --> 00:12:33,800And just to talkabout the volume of people.24200:12:33,800 --> 00:12:37,800Yes. That needed stuff from medicineto, you know, farm supplies24300:12:37,800 --> 00:12:42,840or whatever drives them inthe midst of that need is truly inspiring.24400:12:42,840 --> 00:12:45,800And I and I really appreciate yousharing sharing that with me.24500:12:45,800 --> 00:12:47,440And that was that was amazing.24600:12:47,440 --> 00:12:52,680So I talked to a lotof CIOs around the globe and24700:12:52,760 --> 00:12:53,280there's been a24800:12:53,280 --> 00:12:56,600trend in the lastlike little bit around the CIO24900:12:56,600 --> 00:12:59,880being both the technology leaderand the business leader.25000:12:59,880 --> 00:13:03,520So I had the CIO of the National Bank ofCanada Julie Levesque25100:13:03,720 --> 00:13:08,160talk about thatand say that, you know, the CIO must be25200:13:08,240 --> 00:13:09,120bilingual.25300:13:09,120 --> 00:13:11,800So and she was likeboth business and technology.25400:13:11,800 --> 00:13:14,800And if you don't have business,go get a business degree.25500:13:14,880 --> 00:13:19,760I had a CIO in the UK talk about the CIObeing orchestrating the business.25600:13:19,760 --> 00:13:23,520So, you know, basicallybeing like the conductor and, you know,25700:13:23,520 --> 00:13:25,440bringing business togetherand understanding25800:13:25,440 --> 00:13:27,360all those pieces like you wouldin an orchestra.25900:13:27,360 --> 00:13:29,880So I wanted to talk about that.26000:13:29,880 --> 00:13:33,240From the standpoint of your role,you just talked about some major, major26100:13:33,240 --> 00:13:36,480implementation of tech and peopleand bringing that together.26200:13:36,480 --> 00:13:38,320But I would love to learn your role26300:13:38,320 --> 00:13:42,600as a business leader and how you,you know, build that alongside technology.26400:13:42,840 --> 00:13:44,480Well, it's funny, a while agowe had a kind of26500:13:44,480 --> 00:13:48,320legendary CEO who loved to sayhow Mastercard was a technology company.26600:13:48,400 --> 00:13:51,120And I always say,well, Mastercard is a technology company,26700:13:51,120 --> 00:13:54,720and we run technologyby the transitive property of equality.26800:13:54,720 --> 00:13:56,480Therefore, we're running the company.26900:13:56,480 --> 00:14:00,160Which is also how you learn formal logiconly gets you so far in life.27000:14:00,240 --> 00:14:03,600But I think there is a real truth to that,where most companies,27100:14:03,600 --> 00:14:06,720I would say, used to have productsthat were supported by technology.27200:14:06,720 --> 00:14:09,080It was more of a back office.27300:14:09,160 --> 00:14:11,160And I thinkthe reason why so many people are saying27400:14:11,160 --> 00:14:14,160actually it is a technologycompany is with this physical digital27500:14:14,160 --> 00:14:17,080convergence,with this digitization of everything.27600:14:17,080 --> 00:14:20,760Now our products, our services,our delivery channel to our customers27700:14:20,760 --> 00:14:22,760is through technology.27800:14:22,760 --> 00:14:26,520So it becomes important in a very, verydifferent way than it ever was before.27900:14:26,600 --> 00:14:30,680So not only is digital, the new mediumby which I think almost all of us28000:14:30,680 --> 00:14:34,680do business,I think technology is the silver bullet.28100:14:34,680 --> 00:14:38,840That's where this applied researchcan massively transform and accelerate28200:14:38,840 --> 00:14:42,360what we're doing through data,through processing, through analytics.28300:14:42,360 --> 00:14:45,360So you've gone from being,you know, a cost center28400:14:45,480 --> 00:14:49,000to the primary asset of the organization.28500:14:49,080 --> 00:14:51,040Unfortunately,it doesn't mean you get to spend more, but28600:14:51,040 --> 00:14:54,800you do think about your assets differentlythan how you think about cost centers.28700:14:54,880 --> 00:14:58,840So I think our job,our obligation to the company is28800:14:58,840 --> 00:15:02,920because we're the folkswho actually understand how it works.28900:15:03,000 --> 00:15:06,640The only way you can truly havea strategy, the only way you can map out29000:15:06,640 --> 00:15:11,760the way forward in this progressivelydigitizing world, is if you have that deep29100:15:11,760 --> 00:15:15,640and profound understanding both of whatthe business is trying to accomplish29200:15:15,720 --> 00:15:20,400and the assets you actually have,how the technology actually works.29300:15:20,480 --> 00:15:23,920And when things get off the whiteboardand somebody's got to do something,29400:15:23,920 --> 00:15:25,440that's us.29500:15:25,440 --> 00:15:30,520And I see so many timesthat the ability to intervene or inform29600:15:30,600 --> 00:15:33,480from an engineering standpoint29700:15:33,480 --> 00:15:37,920how it can lead to the actual success ofthe business outcomes we're looking for.29800:15:38,000 --> 00:15:40,920So I love the bilingual lineand I always say29900:15:40,920 --> 00:15:44,800it's like our role and responsibility30000:15:44,880 --> 00:15:48,720to be able to think left brain, rightbrain or on both sides of the equation.30100:15:48,720 --> 00:15:51,400It's really no other job in the businessthat does that.30200:15:51,400 --> 00:15:55,400Yeah, no, I think that that is so trueand certainly I'm hearing it from,30300:15:55,400 --> 00:15:59,080from anybody I interview nowthat that business aspect is so connected30400:15:59,080 --> 00:16:02,400and then that pivot from companiesnow to being tech companies30500:16:02,400 --> 00:16:06,040and really understanding what drivesthe technology innovation,30600:16:06,040 --> 00:16:10,040the implementation, you have a lot of CIOstalking about, you know, the customer.30700:16:10,040 --> 00:16:10,880I'm sure it is in your30800:16:10,880 --> 00:16:13,080what is in your space,because we talked about this already,30900:16:13,080 --> 00:16:15,920the customer,the end user being the most important31000:16:15,920 --> 00:16:18,480and almost working from that space,coming backwards31100:16:18,480 --> 00:16:21,520to looking athow the technology can implement.31200:16:21,600 --> 00:16:21,920About a31300:16:21,920 --> 00:16:25,000month ago, I was very honored to interviewManfred31400:16:25,000 --> 00:16:29,520Boudreaux-Dehmer,who's the first inaugural CIO at NATO.31500:16:29,600 --> 00:16:32,840And, you know,he talked about being a business leader31600:16:33,040 --> 00:16:34,440prior to coming into this role31700:16:34,440 --> 00:16:36,360and then coming into this roleand being a business leader,31800:16:36,360 --> 00:16:39,000but also having to work with 31,you know, soon31900:16:39,000 --> 00:16:42,760soon to be 32 countriesaround the world on a consensus basis.32000:16:42,760 --> 00:16:43,800And having learnings from32100:16:43,800 --> 00:16:47,040that about looking at your North Staras your guiding principle.32200:16:47,040 --> 00:16:49,320But understand owning businessso dramatically,32300:16:49,320 --> 00:16:53,320so you know how to negotiateand navigate those circumstances.32400:16:53,400 --> 00:16:57,080I can I can hardly imagine having 31 now32 different32500:16:57,080 --> 00:17:01,080constituencies under suchan incredible set of external pressures.32600:17:01,080 --> 00:17:05,440If you, you know,and everything that NATO is dealing with.32700:17:05,520 --> 00:17:08,160But I think that is somethingwe learn across our careers and something32800:17:08,160 --> 00:17:13,120I probably got wrong early, where for allof the technical engineering,32900:17:13,200 --> 00:17:16,440social engineeringis an equally important part of success.33000:17:16,600 --> 00:17:20,520And if you understand it,but you can't explain it,33100:17:20,600 --> 00:17:22,120the right things aren't going to happen.33200:17:22,120 --> 00:17:26,200And if you can understand, you know,so often we see it that the people asking33300:17:26,280 --> 00:17:29,320the question don'tunderstand the question, and the people33400:17:29,320 --> 00:17:32,320who are answering the questiondon't understand what they're asking.33500:17:32,320 --> 00:17:35,280And it is that translationthat becomes so essential.33600:17:35,280 --> 00:17:37,920I really appreciate you describing that.33700:17:37,920 --> 00:17:38,840Yeah, I agree.33800:17:38,840 --> 00:17:41,880Social engineeringand that is a great, good big part of33900:17:41,880 --> 00:17:45,120I think these roles nowadaysanybody's role really.34000:17:45,200 --> 00:17:49,600So now I want to pop overand talk about innovation again.34100:17:49,600 --> 00:17:52,960We've been talking a lot this yearabout GenAI and LLMs34200:17:52,960 --> 00:17:56,920and how prevalent they are in discussion,so I'd love to just have you share34300:17:56,920 --> 00:17:59,400your views on GenAIand other LLMs and perhaps34400:17:59,400 --> 00:18:00,880some of the waysyou're looking at deploying34500:18:00,880 --> 00:18:04,680or maybe what you're seeing in marketfrom from other other people, other CIOs,34600:18:04,680 --> 00:18:06,880people who are talking about it.34700:18:06,960 --> 00:18:07,680Well, I do have34800:18:07,680 --> 00:18:11,760I do feel compelled to repeat mymy comment from the CIO conference34900:18:11,840 --> 00:18:14,680that you just had that I thinkone of the greatest things about GenAI35000:18:14,680 --> 00:18:18,520and LLMs, is we got to stop talkingabout the metaverse, right?35100:18:18,560 --> 00:18:20,760We all live through these cycleswhere there's something35200:18:20,760 --> 00:18:22,400profoundly important is changing.35300:18:22,400 --> 00:18:26,760It captures popular imaginationand it's sorting out both from35400:18:26,760 --> 00:18:31,240what is just the undifferentiated hype,from profoundly meaningful35500:18:31,240 --> 00:18:33,640and actually really,really cool capabilities35600:18:33,640 --> 00:18:36,120that are finally blossomingand coming to the core.35700:18:36,120 --> 00:18:38,840Every CIO onthis call has been through cycles of AI.35800:18:38,840 --> 00:18:42,520You know, I'll go back towhen we were seeing the amazing ability35900:18:42,520 --> 00:18:46,760of the machine learning back propagationand TensorFlow and things of that early36000:18:46,840 --> 00:18:49,600earlier iterationswhen you could move from rules36100:18:49,600 --> 00:18:54,120based systems to neural network systemsand things like that. So36200:18:54,200 --> 00:18:59,320the one thing I remind people, we're beenapplying AI in our network for years.36300:18:59,400 --> 00:19:02,360One of myfavorite platforms is engineering marvel36400:19:02,360 --> 00:19:06,520we have, which is our decisionmanagement platform, which uses36500:19:06,600 --> 00:19:09,040a rules parameter and 13 different36600:19:09,040 --> 00:19:13,240AI engines and techniques to find fraudin the systems to fight fraud.36700:19:13,240 --> 00:19:17,240And this year we'll stop over $10 billionworth of fraud,36800:19:17,320 --> 00:19:20,240from coming through the systemthat we couldn't have before.36900:19:20,240 --> 00:19:21,960But when you talk aboutunderstanding the problem37000:19:21,960 --> 00:19:24,480or understanding their customers'objectives,37100:19:24,480 --> 00:19:26,680we probably start by sayinghow do we stop fraud?37200:19:26,680 --> 00:19:28,320What we found is the biggest benefit37300:19:28,320 --> 00:19:32,280we could haveis by letting good transactions through.37400:19:32,360 --> 00:19:35,760So we started applyinga lot of the powerful AI techniques.37500:19:35,840 --> 00:19:40,680We stopped three times more fraud,but removed six times the false positives,37600:19:40,760 --> 00:19:43,200which is all of ustrying to do something legitimately37700:19:43,200 --> 00:19:45,520and having a much better experiencearound that.37800:19:45,520 --> 00:19:48,960So it's already had a massive boonto our business.37900:19:49,040 --> 00:19:53,160So when something like GenAI happens,every CIO gets all these proposals38000:19:53,160 --> 00:19:55,800where people are trying to figure outwhat they could use it for.38100:19:55,800 --> 00:19:57,640I was joking maybe a decade ago.38200:19:57,640 --> 00:20:00,680Every proposalI got was on the blockchain.38300:20:00,760 --> 00:20:03,320I was like, why wouldn't a database workbetter?38400:20:03,320 --> 00:20:04,880Yeah,but this is on the blockchain, right?38500:20:04,880 --> 00:20:06,280I think the same thing.38600:20:06,280 --> 00:20:09,640So avoid that temptation to like,you know, pound screws in38700:20:09,640 --> 00:20:14,520with very expensive socket wrenchesand ask yourself, what's the ten x factor?38800:20:14,600 --> 00:20:16,720What's the thing that we could never dobefore?38900:20:16,720 --> 00:20:19,240What's the hard problemwe've been trying to solve.39000:20:19,240 --> 00:20:21,480Suddenly we might have a way to go after.39100:20:21,480 --> 00:20:25,200So some things I'm really enthusiasticabout are things like code, assist and39200:20:25,200 --> 00:20:28,920developer productivity,and we're seeing some good things there.39300:20:29,000 --> 00:20:32,840The way you can dealwith complex amounts of unstructured data39400:20:32,840 --> 00:20:36,880and information like for customer supportor other things like that.39500:20:36,880 --> 00:20:39,360There'sa lot of complexities to our network.39600:20:39,360 --> 00:20:43,560So helping people understand and navigatethat, we see real, real value there.39700:20:43,640 --> 00:20:47,880So what we're looking at iswhat are the hard problems39800:20:47,880 --> 00:20:53,440we've always had, that these particulartechniques can bring most value to39900:20:53,520 --> 00:20:56,520and then layer on top of thatand apply for that.40000:20:56,520 --> 00:20:58,440And like everyone else,40100:20:58,440 --> 00:21:02,240we're taking things like provenanceof data very, very seriously.40200:21:02,320 --> 00:21:04,880You know, what was thewhat are the models trained on?40300:21:04,880 --> 00:21:07,040Do we layer over with our own information?40400:21:07,040 --> 00:21:10,600How do you get the rightfoundational models around that?40500:21:10,680 --> 00:21:13,960So with a very clear eyed view40600:21:14,040 --> 00:21:17,520of how to manage the inputsand outputs of the systems, we think it's40700:21:17,520 --> 00:21:23,120going to have a very, very importantimpact on all businesses. Not as something40800:21:23,120 --> 00:21:27,280which replaces everything else,but is another amazing tool,40900:21:27,360 --> 00:21:30,280we have to solve hard problemsthat we couldn't have before,41000:21:30,280 --> 00:21:31,920and that's how I really see it fitting in.41100:21:31,920 --> 00:21:33,520I love that answer.Thank you so much for that.41200:21:33,520 --> 00:21:33,760And I41300:21:33,760 --> 00:21:34,560and I think you know,41400:21:34,560 --> 00:21:38,040what I'm hearing from many tech leadersas well is what you just said,41500:21:38,040 --> 00:21:40,080Not as many, not as many as I would think.41600:21:40,080 --> 00:21:41,040But that idea that you've41700:21:41,040 --> 00:21:44,240already been working in this space,you've already been working around41800:21:44,240 --> 00:21:45,280machine learning,41900:21:45,280 --> 00:21:48,280and now you're building on to thatjust to create better outcomes,42000:21:48,280 --> 00:21:50,480but you're doing itin a way that's controlled.42100:21:50,480 --> 00:21:53,880And you know, you look at the waysyou can improve some of your services42200:21:53,880 --> 00:21:56,920and how that will work.So really fantastic.42300:21:56,920 --> 00:21:57,480You know another thought on that.42400:21:57,480 --> 00:21:59,240And I just wanted to get42500:21:59,240 --> 00:22:01,840because it always comes back to the peoplewe all know right?42600:22:01,840 --> 00:22:03,960Tech doesn't do anything. People do it.42700:22:03,960 --> 00:22:06,760And one thing which is interesting to meand there's some great work coming out42800:22:06,760 --> 00:22:11,080of like University of Washingtonon this and human computer interactions42900:22:11,160 --> 00:22:14,200because I think we've at leastI took a simpler view43000:22:14,200 --> 00:22:18,600early on that this was just somethingthat augmented current jobs.43100:22:18,680 --> 00:22:19,920Not as much as how43200:22:19,920 --> 00:22:23,840profoundly it can change the joband if you think about a magazine,43300:22:23,920 --> 00:22:28,560right, the job of being an editoror a fact checker is a lot different43400:22:28,560 --> 00:22:34,120from being the author and, you know,writers notoriously make lousy editors.43500:22:34,200 --> 00:22:36,640So when we think about thesepowerful new techniques,43600:22:36,640 --> 00:22:38,520I think we have to think about not so muchis it43700:22:38,520 --> 00:22:42,240augmenting current work,but how does the work change now?43800:22:42,400 --> 00:22:46,320I absolutely do not believein a dystopian sort of jobless future.43900:22:46,440 --> 00:22:48,120I think every CIO will say44000:22:48,120 --> 00:22:51,960my lists have lists of all the stuffI wish we could get to.44100:22:52,040 --> 00:22:52,840So I think it's something44200:22:52,840 --> 00:22:56,520that we can aid and accelerate,but we have to keep a real eye on44300:22:56,600 --> 00:22:57,720how people are interacting44400:22:57,720 --> 00:23:01,480with this tools and how it will actuallychange the types of jobs they're on.44500:23:01,560 --> 00:23:04,080Because that awesome engineerwho can never do a code review44600:23:04,080 --> 00:23:08,440because they just rewrite and everythingprobably won't benefit it as much.44700:23:08,520 --> 00:23:09,680Interesting.44800:23:09,680 --> 00:23:13,280I thank you for adding that on andI really thank you for joining us today.44900:23:13,280 --> 00:23:15,440This has beenan really informative interview.45000:23:15,440 --> 00:23:18,440I hope we can pick up in 2024and do another one.45100:23:18,480 --> 00:23:20,880Thanks so much for joining me today, Ed.45200:23:20,880 --> 00:23:22,480Well,thank you. It's been a real pleasure.45300:23:22,480 --> 00:23:24,520I certainly hope to see yousoon. Take care.45400:23:24,520 --> 00:23:25,080Thank you.45500:23:25,080 --> 00:23:25,880And if you want to45600:23:25,880 --> 00:23:29,640learn more about this interviewor others, please visit us at cio.com.45700:23:29,640 --> 00:23:30,200Thanks again.