This blog post initially appeared on CMSwire.com and is reblogged here with their consent.
Friends of mine were remodeling their master bath. After searching for a claw foot tub in stores and online, they found the perfect one that fit their space. It was only available for purchase on the retailer’s e-commerce site, they bought it online.
When it arrived, the tub was too big. The dimensions online were incorrect. They went to return it to the closest store, but were told they couldn’t — because it was purchased online, they had to ship it back.
The retailer didn’t have a total customer relationship view or a single view of product information or inventory across channels and touch points. This left the customer representative working with a system that was a silo of limited information. She didn’t have access to a rich customer profile. She didn’t know that Joe and his wife spent almost $10,000 with the brand in the last year. She couldn’t see the products they bought online and in stores. Without this information, she couldn’t deliver a great customer experience.
It was a terrible customer experience. My friends share it with everyone who asks about their remodel. They name the retailer when they tell the story. And, they don’t shop there anymore. This terrible customer experience is negatively impacting the retailer’s revenue and brand reputation.
Bad customer experiences happen a lot. Companies in the US lose an estimated $83 billion each year due to defections and abandoned purchases as a direct result of a poor experience, according to a Datamonitor/Ovum report.
Customer Experience is the New Marketing
Gartner believes that by 2016, companies will compete primarily on the customer experiences they deliver. So who should own customer experience?
Twenty-five percent of CMOs say that their CEOs expect them to lead customer experience. What’s their definition of customer experience? “The practice of centralizing customer data in an effort to provide customers with the best possible interactions with every part of the company, from marketing to sales and even finance.”
Mercedes Benz USA President and CEO, Steve Cannon said, “Customer experience is the new marketing.”
The Gap Between Customer Expectations + Your Ability to Deliver
My previous post, 3 Barriers to Delivering Omnichannel Experiences, explained how omnichannel is all about seeing your business through the eyes of your customer. Customers don’t think in terms of channels and touch points, they just expect a seamless, integrated and consistent customer experience. It’s one brand to the customer. But there’s a gap between customer expectations and what most businesses can deliver today.
Most companies who sell through multiple channels operate in silos. They are channel-centric rather than customer-centric. This business model doesn’t empower employees to deliver seamless, integrated and consistent customer experiences across channels and touch points. Different leaders manage each channel and are held accountable to their own P&L. In most cases, there’s no incentive for leaders to collaborate.
Old Navy’s CMO, Ivan Wicksteed got it right when he said,
“Seventy percent of searches for Old Navy are on a mobile device. Consumers look at the product online and often want to touch it in the store. The end goal is not to get them to buy in the store. The end goal is to get them to buy.”
The end goal is what incentives should be based on.
Executives at most organizations I’ve spoken with admit they are at the very beginning stages of their journey to becoming omnichannel retailers. They recognize that empowering employees with a total customer relationship view and a single view of product information and inventory across channels are critical success factors.
Becoming an omnichannel business is not an easy transition. It forces executives to rethink their definition of customer-centricity and whether their business model supports it. “Now that we need to deliver seamless, integrated and consistent customer experiences across channels and touch points, we realized we’re not as customer-centric as we thought we were,” admitted an SVP of marketing at a financial services company.
You Have to Transform Your Business
“We’re going through a transformation to empower our employees to deliver great customer experiences at every stage of the customer journey,” said Chris Brogan, SVP of Strategy and Analytics at Hyatt Hotels & Resorts. “Our competitive differentiation comes from knowing our customers better than our competitors. We manage our customer data like a strategic asset so we can use that information to serve customers better and build loyalty for our brand.”
Hyatt uses data integration, data quality and master data management (MDM) technology to connect the numerous applications that contain fragmented customer data including sales, marketing, e-commerce, customer service and finance. It brings the core customer profiles together into a single, trusted location, where they are continually managed. Now its customer profiles are clean, de-duplicated, enriched and validated. Members of a household as well as the connections between corporate hierarchies are now visible. Business and analytics applications are fueled with this clean, consistent and connected information so customer-facing teams can do their jobs more effectively.
When he first joined Hyatt, Brogan did a search for his name in the central customer database and found 13 different versions of himself. This included the single Chris Brogan who lived across the street from Wrigley Field with his buddies in his 20s and the Chris Brogan who lives in the suburbs with his wife and two children. “I can guarantee those two guys want something very different from a hotel stay,” he joked. Those guest profiles have now been successfully consolidated.
According to Brogan,
“Successful marketing, sales and customer experience initiatives need to be built on a solid customer data foundation. It’s much harder to execute effectively and continually improve if your customer data is a mess.”
Improving How You Manage, Use and Analyze Data is More Important Than Ever
Some companies lack a single view of product information across channels and touch points. About 60 percent of retail managers believe that shoppers are better connected to product information than in-store associates. That’s a problem. The same challenges exist for product information as customer information. How many different systems contain valuable product information?
Harrods overcame this challenge. The retailer has a strategic initiative to transform from a single iconic store to an omnichannel business. In the past, Harrods’ merchants managed information for about 500,000 products for the store point of sale system and a few catalogs. Now they are using product information management technology (PIM) to effectively manage and merchandise 1.7 million products in the store and online.
Because they are managing product information centrally, they can fuel the ERP system and e-commerce platform with full, searchable multimedia product information. Harrods has also reduced the time it takes to introduce new products and generate revenue from them. In less than one hour, buyers complete the process from sourcing to market readiness.
It Ends with Satisfied Customers
By 2016, you will need to be ready to compete primarily on the customer experiences you deliver across channels and touch points. This means really knowing who your customers are so you can serve them better. Many businesses will transform from a channel-centric business model to a truly customer-centric business model. They will no longer tolerate messy data. They will recognize the importance of arming marketing, sales, e-commerce and customer service teams with the clean, consistent and connected customer, product and inventory information they need to deliver seamless, integrated and consistent experiences across touch points. And all of us will be more satisfied customers.
Like me, you probably just returned from an inspiring Sales Kick Off 2015 event. You’ve invested in talented people. You’ve trained them with the skills and knowledge they need to identify, qualify, validate, negotiate and close deals. You’ve invested in world-class applications, like Salesforce Sales Cloud, to empower your sales team to sell more effectively. But does your sales team have what they need to succeed in 2015?
Gartner predicts that as early as next year, companies will compete primarily on the customer experiences they deliver. So, every customer interaction counts. Knowing your customers is key to delivering great sales experiences.
But, inaccurate, inconsistent and disconnected customer information may be holding your sales team back from delivering great sales experiences. If you’re not fueling Salesforce Sales Cloud (or another Sales Force Automation (SFA) application) with clean, consistent and connected customer information, your sales team may be at a disadvantage against the competition.
To successfully compete and deliver great sales experiences more efficiently, your sales team needs a complete picture of their customers. They don’t want to pull information from multiple applications and then reconcile it in spreadsheets. They want direct access to the Total Customer Relationship across channels, touch points and products within their Salesforce Sales Cloud.
Watch this short video comparing a day-in-the-life of two sales reps competing for the same business. One has access to the Total Customer Relationship in Salesforce Sales Cloud, the other does not. Watch now: Salesforce.com with Clean, Consistent and Connected Customer Information
Is your sales team spending time creating spreadsheets by pulling together customer information from multiple applications and then reconciling it to understand the Total Customer Relationship across channels, touch points and products? If so, how much is it costing your business? Or is your sales team engaging with customers without understanding the Total Customer Relationship? How much is that costing your business?
Many innovative sales leaders are gaining a competitive edge by better leveraging their customer data to empower their sales teams to deliver great sales experiences. They are fueling business and analytical applications, like Salesforce Sales Cloud, with clean, consistent and connected customer information. They are arming their sales teams with direct access to richer customer profiles, which includes the Total Customer Relationship across channels, touch points and products.
What measurable results have these sales leaders acheived? Merrill Lynch boosted sales productivity by 15%, resulting in $50M in annual impact. A $60B manufacturing company improved cross-sell and up-sell success by 5%. Logitech increased across channels: online, in their retail partner’s stores and through distribution partners.
This year, I believe more sales leaders will focus on leveraging their customer information for competitive advantage. This will help them shift from sales automation to sales optimization. What do you think?
“Raw materials costs are the company’s single largest expense category,” said Steve Jenkins, Global IT Director at Valspar, at MDM Day in London. “Data management technology can help us improve business process efficiency, manage sourcing risk and reduce RFQ cycle times.”
Valspar is a $4 billion global manufacturing company, which produces a portfolio of leading paint and coating brands. At the end of 2013, the 200 year old company celebrated record sales and earnings. They also completed two acquisitions. Valspar now has 10,000 employees operating in 25 countries.
As is the case for many global companies, growth creates complexity. “Valspar has multiple business units with varying purchasing practices. We source raw materials from 1,000s of vendors around the globe,” shared Steve.
“We want to achieve economies of scale in purchasing to control spending,” Steve said as he shared Valspar’s improvement objectives. “We want to build stronger relationships with our preferred vendors. Also, we want to develop internal process efficiencies to realize additional savings.”
Poorly managed vendor and raw materials data was impacting Valspar’s buying power
The Valspar team, who sharply focuses on productivity, had an “Aha” moment. “We realized our buying power was limited by the age and quality of available vendor data and raw materials data,” revealed Steve.
The core vendor data and raw materials data that should have been the same across multiple systems wasn’t. Data was often missing or wrong. This made it difficult to calculate the total spend on raw materials. It was also hard to calculate the total cost of expedited freight of raw materials. So, employees used a manual, time-consuming and error-prone process to consolidate vendor data and raw materials data for reporting.
These data issues were getting in the way of achieving their improvement objectives. Valspar needed a data management solution.
Valspar needed a single trusted source of vendor and raw materials data
The team chose Informatica MDM, master data management (MDM) technology. It will be their enterprise hub for vendors and raw materials. It will manage this data centrally on an ongoing basis. With Informatica MDM, Valspar will have a single trusted source of vendor and raw materials data.
Informatica PowerCenter will access data from multiple source systems. Informatica Data Quality will profile the data before it goes into the hub. Then, after Informatica MDM does it’s magic, PowerCenter will deliver clean, consistent, connected and enriched data to target systems.
Better vendor and raw materials data management results in cost savings
Valspar expects to gain the following business benefits:
- Streamline the RFQ process to accelerate raw materials cost savings
- Reduce the total number of raw materials SKUs and vendors
- Increase productivity of staff focused on pulling and maintaining data
- Leverage consistent global data visibly to:
- increase leverage during contract negotiations
- improve acquisition due diligence reviews
- facilitate process standardization and reporting
Valspar’s vision is to tranform data and information into a trusted organizational assets
“Mastering vendor and raw materials data is Phase 1 of our vision to transform data and information into trusted organizational assets,” shared Steve. In Phase 2 the Valspar team will master customer data so they have immediate access to the total purchases of key global customers. In Phase 3, Valspar’s team will turn their attention to product or finished goods data.
Steve ended his presentation with some advice. “First, include your business counterparts in the process as early as possible. They need to own and drive the business case as well as the approval process. Also, master only the vendor and raw materials attributes required to realize the business benefit.”
Want more? Download the Total Supplier Information Management eBook. It covers:
- Why your fragmented supplier data is holding you back
- The cost of supplier data chaos
- The warning signs you need to be looking for
- How you can achieve Total Supplier Information Management
I was recently searching for fishing rods for my 5-year old son and his friends to use at our neighborhood pond. I know nothing about fishing, so I needed to get educated. First up, a Google search on my laptop at home. Then, I jostled between my phone, tablet and laptop visiting websites, reading descriptions, looking at photos and reading reviews. Offline, I talked to friends and visited local stores recently, searching for fishing rods for my 5-year old son and his friends to use at our neighborhood pond. I know nothing about fishing, so I needed to get educated. First up, a Google search on my laptop at home. Then, I jostled between my phone, tablet and laptop visiting websites, reading descriptions, looking at photos and reading reviews. Offline, I talked to friends and visited local stores.
This blog post initially appeared on CMSwire.com and is reblogged here with their consent.
The product descriptions weren’t very helpful. What is a “practice casting plug”? Turns out, this was a great feature! Instead of a hook, the rod had a rubber fish to practice casting safely. What a missed opportunity for the retailers who didn’t share this information. I bought the fishing rods from the retailer that educated me with valuable product information and offered free three to five day shipping.
What does this mean for companies who sell products across multiple channels?
Virtually everyone is a cross-channel shopper: 95 percent of consumers frequently or at least occasionally shop a retailer’s website and store, according to the “Omni-Channel Insights” study by CFI Group. In the report, “The Omnichannel Opportunity: Unlocking the Power of the Connected Customer,” Deloitte predicts more than 50 percent of in-store purchases will be influenced digitally by the end of 2014.
Because of all this crosschannel activity, a new term is trending: omnichannel
What Does Omnichannel Mean?
Let’s take a look back in time. Retailers started with one channel — the brick-and-mortar store. Then they introduced the catalog and call center. Then they built another channel — e-Commerce. Instead of making it an extension of the brick-and-mortar experience, many implemented an independent strategy, including operations, resources, technology and inventory. Retailers recently started integrating brick-and-mortar and e-Commerce channels, but it’s not always consistent. And now they are building another channel — mobile sites and apps.
Multichannel is a retailer-centric, transaction-focused view of operations. Each channel operates and aims to boost sales independently. Omnichannel is a customer-centric view. The goal is to understand through which channels customers want to engage at each stage of the shopping journey and enable a seamless, integrated and consistent brand experience across channels and devices.
Shoppers expect an omnichannel experience, but delivering it efficiently isn’t easy. Those responsible for enabling an omnichannel experience are encountering barriers. Let’s look at the three barriers most relevant for marketing, merchandising, sales, customer experience and information management leaders.
Barrier #1: Shift from product-centric to customer-centric view
Many retailers focus on how many products are sold by channel. Three key questions are:
- How can we drive store sales growth?
- How can we drive online sales growth?
- What’s our mobile strategy?
This is the old way of running a retail business. The new way is analyzing customer data to understand how they are engaging and transacting across channels.
Why is this difficult? At the Argyle eCommerce Leadership Forum, Vice President of Multichannel at GameStop Corp Jason Allen shared the $8.8 billion video game retailer’s approach to overcoming this barrier. While online represents 3 percent of sales, no one measured how much the online channel was influencing overall business.
They started by collecting customer data for analytics to find out who their customers were and how they interacted with Game Stop online and in 6,600 stores across 15 countries. The analysis revealed customers used multiple channels: 60 percent engaged on the web, and 26 percent of web visitors who didn’t buy online bought in-store within 48 hours.
This insight changed the perception of the online channel as a small contributor. Now they use two metrics to measure performance. While the online channel delivers 3 percent of sales, it influences 22 percent of overall business.
Take Action: Start collecting customer data. Analyze it. Learn who your customers are. Find out how they engage and transact with your business across channels.
Barrier #2: Shift from fragmented customer data to centralized customer data everyone can use
Nikki Baird, Managing Partner at Retail Systems Research (RSR), told me she believes the fundamentals of retail are changing from “right product, right price, right place, right time” to:
- Who is my customer?
- What are they trying to accomplish?
- How can we help?
According to RSR, creating a consistent customer experience remains the most valued capability for retailers, but 54 percent indicated their biggest inhibitor was not having a single view of the customer across channels.
Why is this difficult? A $12 billion specialty retailer known for its relentless focus on customer experience, with 200 stores and an online channel had to overcome this barrier. To deliver a high-touch omnichannel experience, they needed to replace the many views of the customer with one unified customer view. They invested in master data management (MDM) technology and competencies.
Now they bring together customer, employee and product data scattered across 30 applications (e.g., e-Commerce, POS, clienteling, customer service, order management) into a central location, where it’s managed and shared on an ongoing basis. Employees’ applications are fueled with clean, consistent and connected customer data. They are able to deliver a high-touch omnichannel experience because they can answer important questions about customers and their valuable relationships, such as:
- Who is this customer and who’s in their household?
- Who do they buy for, what do they buy, where do they buy?
- Which employees do they typically buy from in store?
Take Action: Think of the valuable information customers share when they interact with different parts of your business. Tap into it by bridging customer information silos. Bring fragmented customer information together in one central location. Make it universally accessible. Don’t let it remain locked up in departmental applications. Keep it up-to-date. Automate the process of updating customer information across departmental applications.
Barrier #3: Shift from fragmented product data to centralized product data everyone can use
Two-thirds of purchase journeys start with a Google search. To have a fighting chance, retailers need rich and high quality product information to rank higher than the competition.
Take a look at the image on the left. Would you buy this product? Probably not. One-third of shoppers who don’t make a purchase didn’t have enough information to make a purchase decision. What product information does a shopper need to convert in the moment? Rich, high quality information has conversion power.
Consumers return about 40 percent of all fashion and 15 percent of electronics purchases. That’s not good for retailers or shoppers. Minimize costly returns with complete product information so shoppers can make more informed purchase decisions. Jason Allen’s advice is, “Focus less on the cart and check out. Focus more on search, product information and your store locator. Eighty percent of customers are coming to the web for research.”
Why is this difficult? Crestline is a multichannel direct marketing firm selling promotional products through direct mail and e-Commerce. The barrier to quickly bringing products to market and updating product information across channels was fragmented and complex product information. To replace the manual, time consuming spreadsheet process to manage product information, they invested in product information management (PIM) technology.
Now Crestline’s product introduction and update process is 300 percent more efficient. Because they are 100 percent current on top products and over 50 percent current for all products, the company is boosting margins and customer service.
Take Action: Think about all the product information shoppers need to research and make a decision. Tap into it by bridging product information silos. Bring fragmented product information together in one central location. Make it universally usable, not channel-specific. Keep it up-to-date. Automate the process of publishing product information across channels, including the applications used by customer service and store associates.
Delivering an omnichannel experience efficiently isn’t easy. The Game Stop team collected and analyzed customer data to learn more about who their customers are and how they interact with the company. A specialty retailer centralized fragmented customer data. Crestline centralized product information to accelerate their ability to bring products to market and make updates across channels. Which of these barriers are holding you back from delivering an omnichannel experience?
“Inaccurate, inconsistent and disconnected supplier information prohibits us from doing accurate supplier spend analysis, leveraging discounts, comparing and choosing the best prices, and enforcing corporate standards.”
This is quotation from a manufacturing company executive. It illustrates the negative impact that poorly managed supplier information can have on a company’s ability to cut costs and achieve revenue targets.
Many supply chain and procurement teams at large companies struggle to see the total relationship they have with suppliers across product lines, business units and regions. Why? Supplier information is scattered across dozens or hundreds of Enterprise Resource Planning (ERP) and Accounts Payable (AP) applications. Too much valuable time is spent manually reconciling inaccurate, inconsistent and disconnected supplier information in an effort to see the big picture. All this manual effort results in back office administrative costs that are higher than they should be.
Do these quotations from supply chain leaders and their teams sound familiar?
“We have 500,000 suppliers. 15-20% of our supplier records are duplicates. 5% are inaccurate.”
“I get 100 e-mails a day questioning which supplier to use.”
“To consolidate vendor reporting for a single supplier between divisions is really just a guess.”
“Every year 1099 tax mailings get returned to us because of invalid addresses, and we play a lot of Schedule B fines to the IRS.”
“Two years ago we spent a significant amount of time and money cleansing supplier data. Now we are back where we started.”
Please join me and Naveen Sharma, Director of the Master Data Management (MDM) Practice at Cognizant for a Webinar, Supercharge Your Supply Chain Applications with Better Supplier Information, on Tuesday, July 29th at 11 am PT.
During the Webinar, we’ll explain how better managing supplier information can help you achieve the following goals:
- Accelerate supplier onboarding
- Mitiate the risk of supply disruption
- Better manage supplier performance
- Streamline billing and payment processes
- Improve supplier relationship management and collaboration
- Make it easier to evaluate non-compliance with Service Level Agreements (SLAs)
- Decrease costs by negotiating favorable payment terms and SLAs
I hope you can join us for this upcoming Webinar!
“Not only do we underestimate the cost for projects up to 150%, but we overestimate the revenue it will generate.” This quotation from an Energy & Petroleum (E&P) company executive illustrates the negative impact of inaccurate, inconsistent and disconnected well data and asset data on revenue potential.
“Operational Excellence” is a common goal of many E&P company executives pursuing higher growth targets. But, inaccurate, inconsistent and disconnected well data and asset data may be holding them back. It obscures the complete picture of the well information lifecycle, making it difficult to maximize production efficiency, reduce Non-Productive Time (NPT), streamline the oilfield supply chain, calculate well by-well profitability, and mitigate risk.
To explain how E&P companies can better manage well data and asset data, we hosted a webinar, “Attention E&P Executives: Streamlining the Well Information Lifecycle.” Our well data experts Stephanie Wilkin, Senior Principal Consultant at Noah Consulting, and Stephan Zoder, Director of Value Engineering at Informatica shared some advice. E&P companies should reevaluate “throwing more bodies at a data cleanup project twice a year.” This approach does not support the pursuit of operational excellence.
In this interview, Stephanie shares details about the award-winning collaboration between Noah Consulting and Devon Energy to create a single trusted source of well data, which is standardized and mastered.
Q. Congratulations on winning the 2014 Innovation Award, Stephanie!
A. Thanks Jakki. It was really exciting working with Devon Energy. Together we put the technology and processes in place to manage and master well data in a central location and share it with downstream systems on an ongoing basis. We were proud to win the 2014 Innovation Award for Best Enterprise Data Platform.
Q. What was the business need for mastering well data?
A. As E&P companies grow so do their needs for business-critical well data. All departments need clean, consistent and connected well data to fuel their applications. We implemented a master data management (MDM) solution for well data with the goals of improving information management, business productivity, organizational efficiency, and reporting.
Q. How long did it take to implement the MDM solution for well data?
A. The Devon Energy project kicked off in May of 2012. Within five months we built the complete solution from gathering business requirements to development and testing.
Q. What were the steps in implementing the MDM solution?
A: The first and most important step was securing buy-in on a common definition for master well data or Unique Well Identifier (UWI). The key was to create a definition that would meet the needs of various business functions. Then we built the well master, which would be consistent across various systems, such as G&G, Drilling, Production, Finance, etc. We used the Professional Petroleum Data Management Association (PPDM) data model and created more than 70 unique attributes for the well, including Lahee Class, Fluid Direction, Trajectory, Role and Business Interest.
As part of the original go-live, we had three source systems of well data and two target systems connected to the MDM solution. Over the course of the next year, we added three additional source systems and four additional target systems. We did a cross-system analysis to make sure every department has the right wells and the right data about those wells. Now the company uses MDM as the single trusted source of well data, which is standardized and mastered, to do analysis and build reports.
Q. What’s been the traditional approach for managing well data?
A. Typically when a new well is created, employees spend time entering well data into their own systems. For example, one person enters well data into the G&G application. Another person enters the same well data into the Drilling application. A third person enters the same well data into the Finance application. According to statistics, it takes about 30 minutes to enter wells into a particular financial application.
So imagine if you need to add 500 new wells to your systems. This is common after a merger or acquisition. That translates to roughly 250 hours or 6.25 weeks of employee time saved on the well create process! By automating across systems, you not only save time, you eliminate redundant data entry and possible errors in the process.
Q. That sounds like a painfully slow and error-prone process.
A. It is! But that’s only half the problem. Without a single trusted source of well data, how do you get a complete picture of your wells? When you compare the well data in the G&G system to the well data in the Drilling or Finance systems, it’s typically inconsistent and difficult to reconcile. This leads to the question, “Which one of these systems has the best version of the truth?” Employees spend too much time manually reconciling well data for reporting and decision-making.
Q. So there is a lot to be gained by better managing well data.
A. That’s right. The CFO typically loves the ROI on a master well data project. It’s a huge opportunity to save time and money, boost productivity and get more accurate reporting.
Q: What were some of the business requirements for the MDM solution?
A: We couldn’t build a solution that was narrowly focused on meeting the company’s needs today. We had to keep the future in mind. Our goal was to build a framework that was scalable and supportable as the company’s business environment changed. This allows the company to add additional data domains or attributes to the well data model at any time.
Q: Why did you choose Informatica MDM?
A: The decision to use Informatica MDM for the MDM Trust Framework came down to the following capabilities:
- Match and Merge: With Informatica, we get a lot of flexibility. Some systems carry the API or well government ID, but some don’t. We can match and merge records differently based on the system.
- X-References: We keep a cross-reference between all the systems. We can go back to the master well data and find out where that data came from and when. We can see where changes have occurred because Informatica MDM tracks the history and lineage.
- Scalability: This was a key requirement. While we went live after only 5 months, we’ve been continually building out the well master based on the requiremets of the target systems.
- Flexibility: Down the road, if we want to add an additional facet or classification to the well master, the framework allows for that.
- Simple Integration: Instead of building point-to-point integrations, we use the hub model.
In addition to Informatica MDM, our Noah Consulting MDM Trust Framework includes Informatica PowerCenter for data integration, Informatica Data Quality for data cleansing and Informatica Data Virtualization.
Q: Can you give some examples of the business value gained by mastering well data?
A: One person said to me, “I’m so overwhelmed! We’ve never had one place to look at this well data before.” With MDM centrally managing master well data and fueling key business applications, many upstream processes can be optimized to achieve their full potential value.
People spend less time entering well data on the front end and reconciling well data on the back end. Well data is entered once and it’s automatically shared across all systems that need it. People can trust that it’s consistent across systems. Also, because the data across systems is now tied together, it provides business value they were unable to realize before, such as predictive analytics.
Q. What’s next?
A. There’s a lot of insight that can be gained by understanding the relationships between the well, and the people, equipment and facilities associated with it. Next, we’re planning to add the operational hierarchy. For example, we’ll be able to identify which production engineer, reservoir engineer and foreman are working on a particular well.
We’ve also started gathering business requirements for equipment and facilities to be tied to each well. There’s a lot more business value on the horizon as the company streamlines their well information lifecycle and the valuable relationships around the well.
If you missed the webinar, you can watch the replay now: Attention E&P Executives: Streamlining the Well Information Lifecycle.
Step 1: Determine if you have a customer data problem
A statement I often hear from marketing and sales leaders unfamiliar with the concept of mastering customer data is, “My CRM application is our single source of trusted customer data.” They use CRM to onboard new customers, collecting addresses, phone numbers and email addresses. They append a DUNS number. So it’s no surprise they may expect they can master their customer data in CRM. (To learn more about the basics of managing trusted customer data, read this: How much does bad data cost your business?)
It may seem logical to expect your CRM investment to be your customer master – especially since so many CRM vendors promise a “360 degree view of your customer.” But you should only consider your CRM system as the source of truth for trusted customer data if:
· You have only a single instance of Salesforce.com, Siebel CRM, or other CRM
· You have only one sales organization (vs. distributed across regions and LOBs)
· Your CRM manages all customer-focused processes and interactions (marketing, service, support, order management, self-service, etc)
· The master customer data in your CRM is clean, complete, fresh, and free of duplicates
Unfortunately most mid-to-large companies cannot claim such simple operations. For most large enterprises, CRM never delivered on that promise of a trusted 360-degree customer view. That’s what prompted Gartner analysts Bill O’Kane and Kimbery Collins to write this report, MDM is Critical to CRM Optimization, in February 2014.
“The reality is that the vast majority of the Fortune 2000 companies we talk to are complex,” says Christopher Dwight, who leads a team of master data management (MDM) and product information management (PIM) sales specialists for Informatica. Christopher and team spend each day working with retailers, distributors and CPG companies to help them get more value from their customer, product and supplier data. “Business-critical customer data doesn’t live in one place. There’s no clear and simple source. Functional organizations, processes, and systems landscapes are much more complicated. Typically they have multiple selling organizations across business units or regions.”
As an example, listed below are typical functional organizations, and common customer master data-dependent applications they rely upon, to support the lead-to-cash process within a typical enterprise:
· Marketing: marketing automation, campaign management and customer analytics systems.
· Ecommerce: e-commerce storefront and commerce applications.
· Sales: sales force automation, quote management,
· Fulfillment: ERP, shipping and logistics systems.
· Finance: order management and billing systems.
· Customer Service: CRM, IVR and case management systems.
The fragmentation of critical customer data across multiple organizations and applications is further exacerbated by the explosive adoption of Cloud applications such as Salesforce.com and Marketo. Merger and acquisition (M&A) activity is common among many larger organizations where additional legacy customer applications must be onboarded and reconciled. Suddenly your customer data challenge grows exponentially.
Step 2: Measure how customer data fragmentation impacts your business
Ask yourself: if your customer data is inaccurate, inconstant and disconnected can you:
· See the full picture of a customer’s relationship with the business across business units, product lines, channels and regions?
· Better understand and segment customers for personalized offers, improving lead conversion rates and boosting cross-sell and up-sell success?
· Deliver an exceptional, differentiated customer experience?
· Leverage rich sources of 3rd party data as well as big data such as social, mobile, sensors, etc.., to enrich customer insights?
“One company I recently spoke with was having a hard time creating a single consolidated invoice for each customer that included all the services purchased across business units,” says Dwight. “When they investigated, they were shocked to find that 80% of their consolidated invoices contained errors! The root cause was innaccurate, inconsistent and inconsistent customer data. This was a serious business problem costing the company a lot of money.”
Let’s do a quick test right now. Are any of these companies your customers: GE, Coke, Exxon, AT&T or HP? Do you know the legal company names for any of these organizations? Most people don’t. I’m willing to bet there are at least a handful of variations of these company names such as Coke, Coca-Cola, The Coca Cola Company, etc in your CRM application. Chances are there are dozens of variations in the numerous applications where business-critical customer data lives and these customer profiles are tied to transactions. That’s hard to clean up. You can’t just merge records because you need to maintain the transaction history and audit history. So you can’t clean up the customer data in this system and merge the duplicates.
The same holds true for B2C customers. In fact, I’m a nightmare for a large marketing organization. I get multiple offers and statements addressed to different versions of my name: Jakki Geiger, Jacqueline Geiger, Jackie Geiger and J. Geiger. But my personal favorite is when I get an offer from a company I do business with addressed to “Resident”. Why don’t they know I live here? They certainly know where to find me when they bill me!
Step 3: Transform how you view, manage and share customer data
Why do so many businesses that try to master customer data in CRM fail? Let’s be frank. CRM systems such as Salesforce.com and Siebel CRM were purpose built to support a specific set of business processes, and for the most part they do a great job. But they were never built with a focus on mastering customer data for the business beyond the scope of their own processes.
But perhaps you disagree with everything discussed so far. Or you’re a risk-taker and want to take on the challenge of bringing all master customer data that exists across the business into your CRM app. Be warned, you’ll likely encounter four major problems:
1) Your master customer data in each system has a different data model with different standards and requirements for capture and maintenance. Good luck reconciling them!
2) To be successful, your customer data must be clean and consistent across all your systems, which is rarely the case.
3) Even if you use DUNS numbers, some systems use the global DUNS number; others use a regional DUNS number. Some manage customer data at the legal entity level, others at the site level. How do you connect those?
4) If there are duplicate customer profiles in CRM tied to transactions, you can’t just merge the profiles because you need to maintain the transactional integrity and audit history. In this case, you’re dead on arrival.
There is a better way! Customer-centric, data-driven companies recognize these obstacles and they don’t rely on CRM as the single source of trusted customer data. Instead, they are transforming how they view, manage and share master customer data across the critical applications their businesses rely upon. They embrace master data management (MDM) best practices and technologies to reconcile, merge, share and govern business-critical customer data.
More and more B2B and B2C companies are investing in MDM capabilities to manage customer households and multiple views of customer account hierarchies (e.g. a legal view can be shared with finance, a sales territory view can be shared with sales, or an industry view can be shared with a business unit).
According to Gartner analysts Bill O’Kane and Kimberly Collins, “Through 2017, CRM leaders who avoid MDM will derive erroneous results that annoy customers, resulting in a 25% reduction in potential revenue gains,” according to this Gartner report, MDM is Critical to CRM Optimization, February 2014.
Are you ready to reassess your assumptions about mastering customer data in CRM?
Get the Gartner report now: MDM is Critical to CRM Optimization.
According to a recent article in the LA Times, healthcare costs in the United States far exceed costs in other countries. For example, heart bypass surgery costs an average of $75,345 in the U.S. compared to $15,742 in the Netherlands and $16,492 in Argentina. In the U.S. healthcare accounts for 18% of the U.S. GDP and is increasing.
Michelle Blackmer is an healthcare industry expert at Informatica. In this interview, she explains why business as usual isn’t good enough anymore. Healthcare organizations are rethinking how they do business in an effort to improve outcomes, reduce costs, and comply with regulatory pressures such as the Affordable Care Act (ACA). Michelle believes a data-driven healthcare culture is foundational to personalized medicine and discusses the importance of clean, safe and connected data in executing a successful transformation.
Q. How is the healthcare industry responding to the rising costs of healthcare?
In response to the rising costs of healthcare, regulatory pressures (i.e. Affordable Care Act (ACA)), and the need to better patient outcomes at lower costs, the U.S. healthcare industry is transforming from a volume-based to a value-based model. In this new model, healthcare organizations need to invest in delivering personalized medicine.
To appreciate the potential of personalized medicine, think about your own healthcare experience. It’s typically reactive. You get sick, you go to the doctor, the doctor issues a prescription and you wait a couple of days to see if that drug works. If it doesn’t, you call the doctor and she tries another drug. This process is tedious, painful and costly.
Now imagine if you had a chronic disease like depression or cancer. On average, any given prescription drug only works for half of those who take it. Among cancer patients, the rate of ineffectiveness jumps to 75 percent. Anti-depressants are effective in only 62 percent of those who take them.
Organizations like MD Anderson and UPMC aim to put an end to cancer. They are combining scientific research with access to clean, safe and connected data (data of all types including genomic data). The insights revealed will empower personalized chemotherapies. Personalized medicine offers customized treatments based on patient history and best practices. Personalized medicine will transform healthcare delivery. Click on the links to watch videos about their transformational work.
Q. What role does data play in enabling personalized medicine?
Data is foundational to value-based care and personalized medicine. Not just any data will do. It needs to be clean, safe and connected data. It needs to be delivered rapidly across hallways and across networks.
As an industry, healthcare is at a stage where meaningful electronic data is being generated. Now you need to ensure that the data is accessible and trustworthy so that it can be rapidly analyzed. As data is aggregated across the ecosystem, married with financial and genomic data, data quality issues become more obvious. It’s vital that you can define the data issues so the people can spend their time analyzing the data to gain insights instead of wading through and manually resolving data quality issues.
The ability to trust data will differentiate leaders from the followers. Leaders will advance personalized medicine because they rely on clean, safe and connected data to:
1) Practice analytics as a core competency
2) Define evidence, deliver best practice care and personalize medicine
3) Engage patients and collaborate to foster strong, actionable relationships
Take a look at this Healthcare eBook for more on this topic: Potential Unlocked: Transforming Healthcare by Putting Information to Work.
Q. What is holding healthcare organizations back from managing their healthcare data like other mission-critical assets?
When you say other mission-critical assets, I think of facilitates, equipment, etc. Each of these assets has people and money assigned to manage and maintain them. The healthcare organizations I talk to who are highly invested in personalized medicine recognize that data is mission-critical. They are investing in the people, processes and technology needed to ensure data is clean, safe and connected. The technology includes data integration, data quality and master data management (MDM).
What’s holding other healthcare organizations back is that while they realize they need data governance, they wrongly believe they need to hire big teams of “data stewards” to be successful. In reality, you don’t need to hire a big team. Use the people you already have doing data governance. You may not have made this a formal part of their job description and they might not have data governance technologies yet, but they do have the skillset and they are already doing the work of a data steward.
So while a technology investment is required and you need people who can use the technology, start by formalizing the data stewardship work people are doing already as part of their current job. This way you have people who understand the data, taking an active role in the management of the data and they even get excited about it because their work is being recognized. IT takes on the role of enabling these people instead of having responsibility for all things data.
Q. Can you share examples of how immature information governance is a serious impediment to healthcare payers and providers?
Sure, without information governance, data is not harmonized across sources and so it is hard to make sense of it. This isn’t a problem when you are one business unit or one department, but when you want to get a comprehensive view or a view that incorporates external sources of information, this approach falls apart.
For example, let’s say the cardiology department in a healthcare organization implements a dashboard. The dashboard looks impressive. Then a group of physicians sees the dashboard, point out erroes and ask where the information (i.e. diagnosis or attending physician) came from. If you can’t answer these questions, trace the data back to its sources, or if you have data inconsistencies, the dashboard loses credibility. This is an example of how analytics fail to gain adoption and fail to foster innovation.
Q. Can you share examples of what data-driven healthcare organizations are doing differently?
Certainly, while many are just getting started on their journey to becoming data-driven, I’m seeing some inspiring examples, including:
- Implementing data governance for healthcare analytics. The program and data is owned by the business and enabled by IT and supported by technology such as data integration, data quality and MDM.
- Connecting information from across the entire healthcare ecosystem including 3rd party sources like payers, state agencies, and reference data like credit information from Equifax, firmographics from Dun & Bradstreet or NPI numbers from the national provider registry.
- Establishing consistent data definitions and parameters
- Thinking about the internet of things (IoT) and how to incorporate device data into analysis
- Engaging patients through non-traditional channels including loyalty programs and social media; tracking this information in a customer relationship management (CRM) system
- Fostering collaboration by understanding the relationships between patients, providers and the rest of the ecosystem
- Analyzing data to understand what is working and what is not working so that they can drive out unwanted variations in care
Q. What advice can you give healthcare provider and payer employees who want access to high quality healthcare data?
As with other organizational assets that deliver value—like buildings and equipment—data requires a foundational investment in people and systems to maximize return. In other words, institutions and individuals must start managing their mission-critical data with the same rigor they manage other mission-critical enterprise assets.
Q. Anything else you want to add?
Yes, I wanted to thank our 14 visionary customer executives at data-driven healthcare organizations such as MD Anderson, UPMC, Quest Diagnostics, Sutter Health, St. Joseph Health, Dallas Children’s Medical Center and Navinet for taking time out of their busy schedules to share their journeys toward becoming data-driven at Informatica World 2014. In our next post, I’ll share some highlights about how they are using data, how they are ensuring it is clean, safe and connected and a few data management best practices. InformaticaWorld attendees will be able to download presentations starting today! If you missed InformaticaWorld 2014, stay tuned for our upcoming webinars featuring many of these examples.
“Start your master data management (MDM) journey knowing how it will deliver a tangible business outcome. Will it help your business generate revenue or cut costs? Focus on the business value you plan to deliver with MDM and revisit it often,” advises Michael Delgado, Information Management Director at Citrix during his presentation at MDM Day, the InformaticaWorld 2014 pre-conference program. MDM Day focused on driving value from business-critical information and attracted 500 people.
In Ravi Shankar’s recent MDM Day preview blog, Part 2: All MDM, All Day at Pre-Conference Day at InformaticaWorld, he highlights the amazing line up of master data management (MDM) and product information management (PIM) customers speakers, Informatica experts as well as our talented partner sponsors.
Here are my MDM Day fun facts and key takeaways:
- Did you know that every 2 seconds an aircraft with GE engine technology is taking off somewhere in the world?
GE Aviation’s Chief Enterprise Architect, Ginny Walker, presented “Operationalizing Critical Business Processes: GE Aviation’s MDM Story.” GE Aviation is a $22 billion company and a leading provider of jet engines, systems and services. Ginny shared the company’s multi-year journey to improve installed-base asset data management. She explained how the combination of data, analytics, and connectivity results in productivity improvements such as reducing up to 2% of the annual fuel bill and reducing delays. The keys to GE Aviation’s analytical MDM success were: 1) tying MDM to business metrics, 2) starting with a narrow scope, and 3) data stewards. Ginny believes that MDM is an enabler for the Industrial Internet and Big Data because it empowers companies to get insights from multiple sources of data.
- Did you know that EMC has made a $17 billion investment in acquisitions and is integrating more than 70 technology companies?
EMC’s Barbara Latulippe, aka “The Data Diva,” is the Senior Director of Enterprise Information Management (EIM). EMC is a $21.7 billion company that has grown through acquisition and has 60,000 employees worldwide. In her presentation, “Formula for Success: EMC MDM Best Practices,” Barbara warns that if you don’t have a data governance program in place, you’re going to have a hard time getting an MDM initiative off the ground. She stressed the importance of building a data governance council and involving the business as early as possible to agree on key definitions such as “customer.” Barbara and her team focused on the financial impact of higher quality data to build a business case for operational MDM. She asked her business counterparts, “Imagine if you could onboard a customer in 3 minutes instead of 15 minutes?”
- Did you know that Citrix is enabling the mobile workforce by uniting apps, data and services on any device over any network and cloud?
Citrix’s Information Management Director, Michael Delgado, presented “Citrix MDM Case Study: From Partner 360 to Customer 360.” Citrix is a $2.9 billion Cloud software company that embarked on a multi-domain MDM and data governance journey for channel partner, hierarchy and customer data. Because 90% of the company’s product bookings are fulfilled by channel partners, Citrix started their MDM journey to better understand their total channel partner relationship to make it easier to do business with Citrix and boost revenue. Once they were successful with partner data, they turned to customer data. They wanted to boost customer experience by understanding the total customer relationship across products lines and regions. Armed with this information, Citrix employees can engage customers in one product renewal process for all products. MDM also helps Citrix’s sales team with white space analysis to identify opportunities to sell more user licenses in existing customer accounts.
- Did you know Quintiles helped develop or commercialize all of the top 5 best-selling drugs on the market?
Quintiles’ Director of the Infosario Data Factory, John Poonnen, presented “Using Multi-domain MDM to Gain Information Insights:How Quintiles Efficiently Manages Complex Clinical Trials.” Quintiles is the world’s largest provider of biopharmaceutical development and commercial outsourcing services with more than 27,000 employees. John explained how the company leverages a tailored, multi-domain MDM platform to gain a holistic view of business-critical entities such as investigators, research facilities, clinical studies, study sites and subjects to cut costs, improve quality, improve productivity and to meet regulatory and patient needs. “Although information needs to flow throughout the process – it tends to get stuck in different silos and must be manually manipulated to get meaningful insights,” said John. He believes master data is foundational — combining it with other data, capabilities and expertise makes it transformational.
While I couldn’t attend the PIM customer presentations below, I heard they were excellent. I look forward to watching the videos:
- Crestline/ Geiger: Dale Denham, CIO presented, “How Product Information in eCommerce improved Geiger’s Ability to Promote and Sell Promotional Products.”
- Murdoch’s Ranch and Home Supply: Director of Marketing, Kitch Walker presented, “Driving Omnichannel Customer Engagement – PIM Best Practices.”
I also had the opportunity to speak with some of our knowledgeable and experienced MDM Day partner sponsors. Go to Twitter and search for #MDM and #DataQuality to see their advice on what it takes to successfully kick-off and implement an MDM program.
There are more thought-provoking MDM and PIM customer presentations taking place this week at InformaticaWorld 2014. To join or follow the conversation, use #INFA14 #MDM or #INFA14 #PIM.