Informatica Enterprise Data Management

You may need to reorganize your company to take advantage of modern IT architectures such as SOA or MDM. Some people would say this is heresy – that this is a case of the tail wagging the dog and that the IT strategy should echo the business strategy and operating model. True enough – but IT is also “part” of the business and also has an obligation to play a role in leading the enterprise into the future.The fact is that much of the current IT “mess” is because it has directly mimicked the business. Any organization that builds systems will naturally build them in a way that supports the organizational structure and the lines of communication that are inherent in the functional silos. The legacy problem that most organizations face (high cost of maintenance, lack of agility to change, poor data quality, unpredictable operations) is a direct result of building systems piecemeal in support of silos.

There is no shortage of technology silver bullets to solve the problem. The current crop of solutions includes SOA, MDM and ERP to name just a few.

There may another reason why the Gartner hype cycle exists – you know the one; peak of inflated expectations, trough of disillusionment, plateau of productivity. The reality is that most of these technologies are not technologies at all – they are enterprise strategies. And strategies require a C-level commitment that literally starts with top the organization – the CEO.

Lets take a look at an SOA example. A common business service for a bank is a “Credit Decision” service. Credit decisions should be done consistently across the bank in a way that reflects the bank policies, market strategy, risk management controls and regularity constraints in all the different legal jurisdictions that it operates in. But rather than implement one credit decisioning engine, the Credit Card business implements one, as does the Mortgage Business, the Deposit Business, the Line of Credit business, the Personal Loan business, etc. And if that isn’t enough, since the internet bank is run by a different executive from the retail branch bank – we also have separate decisioning engines for different customer channels. Each of the business groups as a result needs to hire staff to constantly maintain and update the business rules in each of the redundant systems to comply with corporate directives.

If you go and ask each of the LOB managers if they need their own decisioning engine, along with all the overhead that goes along with maintaining it, they will likely say no. It doesn’t make sense. But if you try to implement an SOA strategy in a large bank with 10 different decisioning engines, you will have an uphill battle. The first challenge is one of timing. While all 10 groups may in fact be totally on-board with the concept, they all have different priorities in any given year. You may be waiting forever for all the stars to align such that a critical mass of them are prepared to all focus on implementing a generic solution at the same time.

It’s clear from this example that reorganizing the business to create a “credit decisioning function” that serves the enterprise would dramatically simplify the IT solution. The typical pattern however is to avoid the hard work of addressing the organizational, people and political issues and instead try to solve the problem “bottom up” by incrementally and thereby iterate towards an enterprise solution. The bottom-up approach can in fact work – but don’t make the mistake to think that it’s necessarily easier more successful. The reason so many organizations are in the SOA Trough of Disillusionment is exactly because they are building it bottom-up and have not addressed the organizational issues.

Let’s take another example – Master Data Management. MDM promises to deliver quality information and one version of the truth for business data. But in order to achieve this, the organization needs an information owner (or steward) who is accountable for data quality, consistency, currency, security, etc. For most companies that are organized around LOBs or products – who owns customer information? In the absence of a business owner, a common pattern is for IT to step and presume a stewardship role. Unfortunately (as is evidenced by a long list of less than ideal CRM implementations) the IT group often does so without an official sanction from the business executives so the results should not be a big surprise.

This is not to say that any of the technologies that are inherent in SOA, MDM or ERP are bad or flawed. In fact, they are the result of the smartest people in the industry creating the technologies and the result of market forces testing the all the innovate ideas and having the best ones bubble to the surface.

At the risk of repeating myself, the point is that successful implementation is much more than a technology. You can't “buy” SOA or MDM – these are strategies that demand organizational top-down commitment. While a bottom-up strategy can make meaningful progress and deliver significant results, IT organizations should not be afraid to tackle the “big” issues of organizational design and politics. IT is part of the business. And as IT has become a larger and larger player in most organizations due to the natural shift to an information economy, it would be wrong to think of this as the tail wagging the dog.