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November 19, 2012

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The Adaptive Enterprise: New Directions for MDM?

by juliebhunt
techslide

A new article by our editor, Julie Hunt, a software industry strategist and analyst.  

As market forces continue to fluctuate, business leaders are searching for the best ways to work with uncertainty and still deliver improved performance. As a result, organizations are transforming into adaptive enterprises.

Performance for the adaptive enterprise means agile, dynamic, and responsive to continuous change. But this kind of performance requires enterprise data that is reliable, usable and timely, so that analytics and decision-making processes are quickly on target with relevant recommendations.

Information management has an important new challenge for provisioning right-time data to emerging adaptive enterprises. MDM is a reflection of how an enterprise uses data and information for business purposes. The creation and management of master data touches more than the information itself. By creating data repositories and processes that reflect business functions, enterprises should now have access to the information that is so vital to effectively and agilely adapting to constant change.

Agile Processes, Agile Data

SurferWave

In 2011, Gartner surveyed 300 user organizations: 49 percent said process improvements are the key business priority driving interest in MDM. Gartner’s Andrew White commented:

“MDM treats information as assets that indirectly contribute to enterprise performance by improving process execution via data consistency,” White wrote in his presentation slides. “BPM is a management discipline that treats processes as assets that directly contribute to enterprise performance.”

MDM has a clear role in improving business processes; both MDM and optimized processes contribute to better performance management. The increasing focus on master data in relation to business processes extends usage across the enterprise to more business roles and functions. For many enterprises, data governance policies are the means for the orchestration of master data management, practices, processes, and people, so that compliance with data governance policies assures that master data is available as a trusted and vital asset for the enterprise. A new direction and challenge for data governance will be creating policies that reflect the continuously changing needs of the adaptive enterprise.

Dynamic Business Processes: Adaptive Case Management

Adaptive case management is an interesting example of adaptive and responsive processes that depend on reliable data. Forrester Research defines adaptive case management (ACM) this way (Forrester calls it dynamic case management):

A highly structured but also collaborative, dynamic and information-intensive process that is driven by outside events and requires incremental and progressive responses from the business domain handling the case. Examples of a case folder include a patient record, a lawsuit, an insurance claim, or a contract, and a case folder would include all of the documents, data, collaboration artifacts, policies, rules analytics, and other information needed to process and manage the case.

Immediate access to the right information is essential to ACM due to the unpredictable nature of case management knowledge work. ‘Unpredictable’ is also a driving force of the adaptive enterprise, where there is increasing need for organizations to adapt to the volatile nature of business as it happens. ACM may evolve beyond its ‘roots’ in business process management to become a much-needed internal platform of process orchestration, practices and technology to more relevantly and quickly surface the most-needed information, content, and data, wherever they exist in the enterprise — all in the context of situational business processes related to a particular employee’s responsibilities.

Frequent mandates for ACM include managing risks and compliance, containing costs, applying a systems approach to non-conforming processes, and the ability to respond well to the unexpected. MDM parallels these mandates with a number of its value areas for enterprises:

  • Compliance and risk management
  • Revenue growth
  • Customer interactions
  • Cost and performance efficiency
  • Business agility

Both MDM and ACM can contribute positively to customer-focused activities, along the lines of real-time analytics, decision-making, dynamic process, and timely responsiveness.

Performance, Outcomes, Metrics

Obviously, ineffective business processes and data bottlenecks are obstacles to the adaptive enterprise that needs to nimbly change in response to events and new insight, and to rapidly make decisions to make the most of new opportunities and challenges. Achieving performance improvements starts with identifying how data-fueled processes can be optimized, and how MDM and BPM can work together to do so. Well-functioning business processes, whether explicitly defined or adaptive (as in case management), are an essential contributor to agile business performance.

A classic example of setting an improvement objective aligned with MDM is the reconciliation of customer identity across systems of record and systems of engagement, since both domains must be integrated to support and capture customer interactions. Many business functions – and strategies – greatly benefit from a unified view of the customer. The organization can quickly and accurately interact with customers. Now metrics can be applied to measure outcomes and performance relative to customers, based on the organization’s KPI preferences, and tied to corporate and line-of-business objectives.

Processes and performance improvement initiatives can be decomposed into master data elements that can be sorted and aggregated properly for metrics to quantify value. Focus is put on the data assets that are the most essential for overall business improvement. MDM makes such a focus repeatable across the enterprise to integrate business processes and metrics around the same master data elements.

The Successful Adaptive Enterprise

Success factors for enterprises almost always include effective leaders, the right strategies, and high quality products and services that meet customer needs. But more and more demands are pushing enterprises to constantly monitor and respond to changes in markets, customers and competitors. These changes will then alter other success factors: strategies now have a shorter shelf life. Enterprises are challenged to:

  • Transform to an organization comfortable with continuous adaptive behavior while relying on business processes and data systems to increase flexibility at tactical and strategic levels
  • Make better use of data, processes, analytics to improve decisions, to predict future trends and markets, and to proactively manage change
  • Develop responsive risk management and compliance processes that are ready for the uncertainties of business, both good and bad

Data analytics are seeing wider adoption as important tools throughout the enterprise, reflecting the convergence of BI, BPM and MDM. Analytics are also being used to evaluate enterprise data to improve both information management and business processes, more frequently in real time. Analytics-fueled data management capabilities bring improvements and evolution to data integration and data quality approaches. More enterprises are looking for analytics embedded in a wide variety of systems, including operational systems that now make use of real-time analytics and decision-making technology.

MDM initiatives have the right capabilities and strategic purpose to underpin business agility and the adaptive enterprise. Master data can be extended to provide improved use of information systems and repositories throughout the enterprise. MDM can stretch its data muscles to take on new business requirements and objectives where data and process are key components, and now venture into new categories that need MDM to better serve the enterprise. To achieve agile business actions takes highly disciplined approaches to MDM and data governance; and it takes flexibility bred into information management DNA to be able to quickly but reliably handle change.

About the author: Julie Hunt is the Editor of Hub Designs Magazine. As a software solution strategist, she understands the overlap and convergence of many business processes and software solutions that once were thought of as “separate” – and how this impacts both software vendors and buyers, as well as the strategies that enterprises implement for how technology supports the business and its customers. Julie shares her take on the software industry via her blog Highly Competitive and on Twitter: @juliebhunt. For more information, please visit Julie Hunt Consulting – Strategies for B2B Software Solutions: Working from the Customer Perspective.

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2 Comments
  1. BPM is a discipline that puts people and process as drivers of business creation. Adaptive Case Management ACM is the focus on a technology that is customer centric where users must have data presented to the right user at the right time. Some data may well be held disparate systems and MDM tools need to be able to extract as required to be available for the user? The trick is to have all such requirements including all business logic in one tool, And the build all done in business language in a graphical interface no code change generation or compiling – it is the future?

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