Building the Business Case (Part 4) – Gaining Alignment
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In the previous installments of this series, we covered three key drivers for building your business case: Risk Management, Cost Reduction, and Revenue Growth.
Now, we’ll review the importance of and the process for gaining organizational alignment with your strategy.
When you’re building support for your business case, it’s critical to gain alignment at all levels of the organization throughout the whole process. Making the case for an information management strategy cannot rest with only one executive. And it can’t be the brainchild of IT only, or lack executive sponsorship altogether.
You need as many areas aligned as possible. More than likely, a comprehensive information management strategy needs to consider all of the data streams across the enterprise (at some point), and will therefore be fairly time and resource intensive.
If you take a three-pronged approach to gaining alignment, then you’re well on your way to obtaining approval to implement your strategy:
(1) Get front-line employees and customers to identify the problems with the data. You should have been gathering their feedback and facts as you built your case. So when you can readily articulate that customers are frustrated with your company, or that your employees are performing workarounds, rework, or aren’t as effective as they could be, then you’ve got your “first-level buy in”.
(2) You need their individual management teams to agree that these issues exist. They need to agree that they’d be more effective in achieving their goals if they had a solution to their information problems. And most importantly, if you can get them to agree that an information management strategy should be a priority and they support the contents of the business case (which shouldn’t be too difficult if you had their support during the development of the business case), then these folks become your best allies.
(3) Have those management teams bring this message forward to their leadership. When the leaders hear, directly from their own people, that they should understand and support the business case, then your business case has achieved a level of credibility you wouldn’t have gained on your own. And your role then becomes one of subject matter expert, business case developer, and valued business partner.
I do recommend getting several executives aligned to the strategy. Because of the size of the undertaking, you’ll need several leaders to prioritize and support the effort. Providing headcount, funding and the time to deliver on the plan will be crucial from these leaders.
Once again, the more compelling your business case (whether it’s to comply with regulations, reduce costs or improve revenues), the more chance you’ll have in gaining attention and alignment.
Which brings us to the final point: set up your program so that small wins are achieved throughout.
Whether you need to set up prototypes, pilots, or small projects while you are driving the entire strategy over time (probably several years), you need to prove results. Otherwise, no matter how great your plan, the organization will lose interest along the way.
So, if you set expectations appropriately, have a good measurement plan in place, and keep communicating constantly with all levels of the organization, then you’ve got a great chance of succeeding!
Interview at MDM Summit on DMRadio
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I was interviewed recently at the Spring 2008 MDM Summit in San Francisco.
DMRadio (which broadcasts weekly on DMReview.com) did a broadcast from the exhibit floor, featuring:
- Marty Moseley from Initiate Systems
- Christopher Dwight from Oracle
- Dan Power from Hub Solution Designs
- Justin Magruder from Freddie Mac
- Richard Pilkington from SyncSort
- John Smolarski & Anshuman Sindhar from Countrywide
- David Codelli, Sun Microsystems
To hear the interview, just click http://www.dmreview.com/dmradio/10001100-1.html, then click on the third “Play” button from the top.
DIG 2008 – Decisions, Information and Governance Conference
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A very interesting MDM speaking engagement came up recently, at the DIG 2008: Decisions, Information and Governance Conference in Las Vegas on May 13-15.
The conference organizer, The Palladium Group, says:
DIG is the foremost performance management and analytics conference designed to provide business leaders with the tools and insights needed to leverage information for critical decision-making, helping them to achieve breakthrough business performance. We step beyond normal one-sided lectures to spark open and honest dialog with our presenters. Sessions will be designed with ample time for discussion, ensuring each attendee is included in the dialog – a collaborative environment truly unique in the industry.
A few months ago, a good friend from my days at Parson Consulting, Curtis Horton, connected me with George Veth, because George and I both live in Hingham, Massachusetts. George was the CEO of Painted Word, a consulting firm that merged with the Balanced Scorecard Collaborative and ThinkFast Consulting to form The Palladium Group in 2005. George and I got together for breakfast in early March, and he suggested me to Palladium when they were putting together this conference.
I’m very excited about this conference, because Palladium really seems to understand the tight connection between “good information” (achieved through MDM), good governance (achieved through Data Governance) and “good decisions”.
A lot of people seem to be treating MDM in isolation, as a pure technology or infrastructure project. But we feel that MDM and Data Governance together are an important enabler for business intelligence and Business Performance Management.
So it should be an interesting conference, exploring three important themes: “Creating One Version of the Truth”, “Insights from Advanced Analytics”, and “Enterprise 2.0″.
I’ll be speaking on Wed. May 14th, after Dennis Newman, Director of Financial Operations at the Boston Globe, and David Roberts, CTO for Applications Services at the Central Intelligence Agency.
If you’re interested in attending, just go to http://thepalladiumgroup.com/DIG2008 to register, and you can use the “promo code” DIGHUB to get 50% off the conference registration.
If you’re a client of Hub Solution Designs and would like to attend, please contact us – we have a limited number of conference passes available as well.
Keys to a Successful MDM Program
Master Data Management (MDM) initiatives often seem to begin with the CIO and consequently, the implementation takes on a strong technology focus.
But in today’s article, we want to suggest an approach that’s more likely to succeed in the long run – tying the MDM project to solving an important business problem, and then getting the business to not only sponsor the initiative, but to “own” it.
Depending on your industry, there are key business drivers frequently seen in that industry. For example, in manufacturing, the key drivers are usually margin analysis, supply chain analysis, product profitability and customer satisfaction. In the software industry, license revenue analysis, maintenance contract revenue (new and renewals), support margins and customer satisfaction are the key drivers.
When you talk about how MDM may improve results in these areas, the business owners perk up and listen. So invest some time in understanding the corporation’s strategic priorities for the next few fiscal years, and then choose a small number of these strategic priorities as the key drivers to be tied to MDM.
At a leading software company, Marketing had recently undergone a radical overhaul. The new head of Marketing was swamped by the number of “mini-databases” that had sprung up, both within the department itself and within IT. For their launch of their new software product, he needed to know who his customers were – on a particular version, at a particular support level, and in a particular geography.
It took the Marketing department weeks to get that final list. As a result, the CIO stepped up and linked the MDM initiative’s success to specific metrics used by Marketing.
Marketing was then totally engaged in the MDM project, and that momentum carried right through the product launch. And Marketing even hired a data steward for ongoing data management.
Had it only been the Technology group carrying the burden of doing the MDM project, I’d bet the project would have fallen by the wayside and there would not be any surviving MDM program there.
The key takeaway is to link your Data Quality and MDM initiatives to your enterprise’s key business drivers and your executives’ priorities. Only then you will get the business to put their money where their mouth is. And only then will you be assured of a successful ongoing MDM program.
MDM Boot Camp at MDM Summit Conference
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At the recent MDM Summit conference in San Francisco, I attended the “MDM Boot Camp” session put on by Aaron Zornes and Ed Allburn with my colleague, Maureen Butler.
I’ve attended five MDM Summit conferences at this point, but never had a chance to catch the Boot Camp session before. My colleagues and I work pretty hard at staying current on Master Data Management, so it was interesting to hear what Aaron and Ed had to say.
One of the first things Aaron said was “the world is flat, so data structures and business processes must be flexible, and IT must be able to enable new business models.” I’ve finally gotten around to reading “The World is Flat” by Thomas Friedman, so I really liked the idea of tying MDM to the increased agility that enterprises are struggling to achieve in order to remain competitive and relevant.
Another tie-in was the extent to which many firms are now using mergers & acquisitions as a core part of their business strategy, and the degree to which Master Data Management is critical to enabling smooth integration of acquired companies.
Aaron did a great recap of the three classic “use cases” for MDM: Operational, Analytical and Collaborative, and reviewed the top five justifications for MDM initiatives.
He reviewed the “strategic planning assumptions” that the MDM Institute has published, covering the expected market maturation, momentum, consolidation and diversification; recent issues around budgets and skills; the importance of data governance; the architectural trends towards multi-domain MDM and service-oriented architecture (SOA); the move toward improved identity resolution, data quality and analytics; and the trend towards 4th generation “policy hubs” and enterprise search.
Maureen and I thoroughly enjoyed the session; it was a great way to kick off our three days at the MDM Summit. We’re looking forward already to the Fall 2008 MDM Summit at the New York Hilton (Oct. 19–21, 2008).
MDM Report from DM Review
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I just got the “MDM Report” newsletter from DMReview.com, and it had a good article by Jim Ericson on the MDM Summit held recently in San Francisco.
It also featured our article on “The Politics of Master Data Management and Data Governance“.
I thought Jim had some good insights, including:
- MDM (master data management) is a hot topic at Global 2000 companies
- MDM as a technology and practice is hugely underpenetrated
- Existing MDM programs are both focused and either very incomplete or fragmented
- While multi-entity MDM is becoming relevant to early and advanced adopters, the focus remains on the customer and the top line (with a strong nod to compliance)
- The cost of entry to MDM remains high and requires extensive pre-planning and governance strategies to be successful
- More enterprises are buying MDM solutions, while others continue to build on their own homegrown systems.
I really enjoyed the Spring ’08 MDM Summit, as always. We’ll be writing some additional articles about individual sessions and themes we observed in the next week or so.
Data Quality: an integral part of MDM
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In a bid to position themselves as leaders in the Master Data Management space, several vendors position their MDM platform as a complete solution.
The truth is that these claims are somewhat misleading. Some claim that Data Governance (a critical component of an MDM program) is built-in functionality. However, they don’t provide a Data Quality capability in their product. Today, I want you to think about the fact that Data Quality is an integral part of Data Governance and a successful MDM program.
Here’s the methodology we recommend:
1. Analyze the business problems that MDM will address
2. Define critical metrics for data and other business issues
3. Link the metrics to business problems
4. Measure results and quantify improvements
5. Communicate results and improvements across the enterprise
6. Secure budget for next year
In order to execute this methodology, it’s imperative that Data Quality measures and related workflows be part of the MDM platform your vendor provides. If not, consider a third party DQ tool to integrate with your MDM platform.
If you’d like to ask about some of the typical Data Quality metrics we’ve used in previous implementations, please contact us.
Haidong Song from Oracle at OAUG Conference
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I just attended a great session by Haidong Song from Oracle in the MDM track at the COLLABORATE 08 conference, being put on this week in Denver by the Oracle Applications Users Group (OAUG).
I’ve known Haidong for several years, from my “previous life” at D&B, where I managed D&B’s alliance relationship with Oracle.
He made several great points that resonated with me:
- “MDM is the foundation for all of the other product areas and modules”
- “Poor Data Quality is the #1 Enemy of MDM”
- “Somehow, data has been left out – an afterthought – but if you don’t focus on the data, you’ll have issues”
- “Technology can actually magnify the problem if you propagate bad data across the enterprise”
- “Master data is in a constant state of flux” (what I call the ‘data decay’ problem)
- “Master data changes at a rate of 2% per month on average, so after 2 years, nearly half your data is obsolete or suspect”
Haidong talked about why data governance is needed in the enterprise, and how data quality issues can be an inhibitor to application acceptance. He talked about helping clients to avoid large fines and bad publicity, and the need to formalize a data governance framework.
He gave Toyota Financial Services and UMB Bank as two customer success stories, talking about their situation and challenges, and the Oracle solution they implemented and the positive results they experienced.
And he used the idea of a “Day in the Life of a Data Steward” to walk the audience through Oracle’s new “Data Watch & Repair” offering for MDM. It’s a closed-loop process, consisting of “Connect”, “Profile”, “Assess” and “Repair & Monitor” steps.
He also discussed Oracle’s integration with Acxiom, a consumer content provider, and with D&B, a business content provider.
He ended by describing Oracle’s MDM solution as the most complete offering on the market today. At Hub Solution Designs, we partner with all of the leading MDM hub providers. But from my previous experience with Oracle’s MDM products, and Haidong’s session today, I am very comfortable predicting continued success for Oracle in the marketplace.
Evaluating MDM Vendors
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Today, we’ll talk about some criteria you can use to evaluate Master Data Management vendors.
Before you go into “evaluation mode”, it’s important that, on the business side, you first have your MDM strategy chalked out.
And on the technical side, you should have mapped your organization’s data landscape, completed some in-depth data profiling and documented your data requirements. Not doing these things can significantly reduce your chances of getting the right MDM platform for your company.
Some important questions you can ask your potential vendors are:
- Do they support multiple data domains? In other words, does their solution handle just one type of data (like customer), or can it handle other important types of data, like product information, as well?
- In what vertical industries do they have a strong presence?
- Is their solution service-oriented architecture (SOA) enabled? What services are available “out-of-the-box”?
- Does their product have workflow capability or an MDM methodology built-in?
- If hierarchies are important to your organization, do they have a flexible hierarchy management tool?
- What third-party data providers do they integrate with (e.g. D&B, Axciom, Trillium, etc.)?
- Is their solution used primarily for operational or analytical MDM?
- What’s the state of resource availability in the market (or at SI firms) to implement their solution?
- Do they have an integrated data quality engine for standardization, matching and measurement purposes?
- Lastly, are they easy to work with in terms of response times, flexibility, and demonstrated alignment with your corporate objectives?
Answers to these questions may not be readily available on the vendors’ websites. But if your organization hasn’t started its software evaluation process yet, and you’d like answers to some of these questions, please feel free to contact us for our perspective.
MDM Summit Trip Report
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Last week’s MDM Summit conference was great, as usual. Attendance may have been down slightly due to the well-publicized economic situation. But there were still a lot of “end user companies” in attendance, either speaking or attending to learn more about this fast-growing field.
One theme we picked up on was the idea of “Master Data Management solving business problems”, rather than being a pure technology “silver bullet”. While having a central hub, married up to powerful data quality software, and integrated with the rest of the enterprise via the latest Service-Oriented Architecture integration tools is very definitely sexy, what’s even more compelling is looking for and solving the most difficult recurring problems that today’s large companies are facing.
Whether it’s driving increased revenue through better, more effective marketing and selling, or reducing costs by improving process efficiency and sunsetting redundant application infrastructure, or enabling smoother, more rational regulatory compliance, the promises of MDM are being realized in the leading companies who are implementing it.
This is not hype, people. While there may well be a “trough of disillusionment” in MDM’s future (or going on right now), the business and IT benefits are real, large and realizable. This is not a repeat of the wave of ERP adoption prior to Y2K, or the rush to implement a “me too” CRM strategy.
Any time you can help the business make more money, spend less money, and have a markedly easier time getting the bureaucratic monkey off its back, people in the business are going to notice and reward you for it.
I hate to say “the future’s so bright we have to wear shades”, but from our perspective, MDM is just hitting its stride, and does indeed have a bright future.
If you disagree, we’d love to hear from you via a comment.
Role of MDM and Data Governance in SOA
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As SOA (service oriented architecture) initiatives gain popularity, let’s look at how MDM (master data management) and data governance can dovetail with a SOA strategy.
SOA, although technically a type of IT architecture, is more of an integrated approach to building high-level services that are inherently reusable and scalable across various applications. High-level services are not consumed as end-point services themselves, but operate more at the business process level.
While composing the entity framework for a service-oriented architecture, a Data Governance Council should be an integral part of the SOA team. The role of the Data Governance Council is two-fold:
- Provide a comprehensive data map (authoritative sources, data flows and underlying data policies) to the SOA architects, and
- To plan and implement “Master Data Services” as part of the services available for consumption to applications within the scope of SOA. An example would be “Create Customer”, where sources, lookups, standards, business validations and enrichments are all built-in, and are available for applications across the enterprise to consume in a robust, auditable fashion.
So what does this do for an MDM initiative?
It provides a powerful platform to integrate the current business processes and to improve levels of data quality, to provide accurate, current and complete data within and outside the IT applications.
It also provides a central platform and process for various domains of master data (suppliers, items, etc) as they come aboard the MDM bandwagon.
Building the Business Case (Part 3) – Revenue Growth
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Business Growth is really the heart of your business case. If you can identify how an Information Management strategy will enable your company’s growth, then your chances of success go way up!
This topic may be a little more difficult to document, but most executives will not argue with you if you can validate your premises.
Start by looking at existing strategic initiatives, then meet with the business areas responsible for those results and see if issues with the current corporate data could prevent them from achieving their goals.
Let’s look at the types of growth enablers you might consider:
• Mergers & Acquisitions
• Customer Service / Experience
• Customer Targeting
• Customer Coverage
• Forecasting / Planning / Modeling / Reporting
• Product / Service Offering
• Channel Strategies
• International Strategies
Questions you might ask your internal partners are: “Could you be more effective at getting your marketing materials to the right person?” “Could you improve targeting or forecasting through improved reporting, modeling or planning efforts?” “Could you improve the customer coverage model if we could more effectively identify and target customers?” “Are we failing the customer because processes are operating with bad data?” “Are there channel conflicts due to multiple or uncontrolled data sources?” “If you had better business intelligence, would you have a better chance of bringing the right product or service to market?”
If you get “yes” answers, then determine the benefits and the order of magnitude if you had a solution. Types of solutions could be through solving problems with data quality, hierarchy management, data integration, and resolving data source conflicts (through a Single Source of Truth), etc.
By helping business leaders frame their problems in terms of how an Information Management strategy could help them, then you’ve got the beginnings of a strong business case.
Your next step is to define the business requirements in more detail, and have your internal business partner(s) help you quantify the impact of solving their problems.
Stay tuned for Part 4, where Maureen Butler covers how to get organizational alignment for your business plan.
