Category Archives: Governance, Risk and Compliance

Takeaways from the Gartner Security and Risk Management Summit (2014)

Last week I had the opportunity to attend the Gartner Security and Risk Management Summit. At this event, Gartner analysts and security industry experts meet to discuss the latest trends, advances, best practices and research in the space. At the event, I had the privilege of connecting with customers, peers and partners. I was also excited to learn about changes that are shaping the data security landscape.

Here are some of the things I learned at the event:

  • Security continues to be a top CIO priority in 2014. Security is well-aligned with other trends such as big data, IoT, mobile, cloud, and collaboration. According to Gartner, the top CIO priority area is BI/analytics. Given our growing appetite for all things data and our increasing ability to mine data to increase top-line growth, this top billing makes perfect sense. The challenge is to protect the data assets that drive value for the company and ensure appropriate privacy controls.
  • Mobile and data security are the top focus for 2014 spending in North America according to Gartner’s pre-conference survey. Cloud rounds out the list when considering worldwide spending results.
  • Rise of the DRO (Digital Risk Officer). Fortunately, those same market trends are leading to an evolution of the CISO role to a Digital Security Officer and, longer term, a Digital Risk Officer. The DRO role will include determination of the risks and security of digital connectivity. Digital/Information Security risk is increasingly being reported as a business impact to the board.
  • Information management and information security are blending. Gartner assumes that 40% of global enterprises will have aligned governance of the two programs by 2017. This is not surprising given the overlap of common objectives such as inventories, classification, usage policies, and accountability/protection.
  • Security methodology is moving from a reactive approach to compliance-driven and proactive (risk-based) methodologies. There is simply too much data and too many events for analysts to monitor. Organizations need to understand their assets and their criticality. Big data analytics and context-aware security is then needed to reduce the noise and false positive rates to a manageable level. According to Gartner analyst Avivah Litan, ”By 2018, of all breaches that are detected within an enterprise, 70% will be found because they used context-aware security, up from 10% today.”

I want to close by sharing the identified Top Digital Security Trends for 2014

  • Software-defined security
  • Big data security analytics
  • Intelligent/Context-aware security controls
  • Application isolation
  • Endpoint threat detection and response
  • Website protection
  • Adaptive access
  • Securing the Internet of Things
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Posted in Big Data, CIO, Data Governance, Data Privacy, Data Security, Governance, Risk and Compliance | Tagged , , , , , , , , | Leave a comment

Informatica Named a Leader in Gartner MQ for Data Archiving

Structured Data Archiving and Application Retirement

Gartner MQ for Structured Data Archiving and Application Retirement

For the first time, Gartner has released a Magic Quadrant for Structured Data Archiving and Application Retirement . This MQ describes an approach for how customers can proactively manage data growth. We are happy to report that Gartner has positioned Informatica as a leader in the space. This is based on our ‘completeness of vision’ and our ‘ability to execute.’

This magic quadrant focuses on what Gartner calls Structured Data Archiving. Data Archiving is used to index, migrate, preserve and protect application data in secondary databases or flat files. These are typically located on lower-cost storage, for policy-based retention.  Data Archiving makes data available in context of the originating business process or application. This is especially useful in the event of litigation or of an audit.

The Magic Quadrant calls out two use cases. These use cases are “live archiving of production applications” and “application retirement of legacy systems.”  Informatica refers to both use cases, together, as “Enterprise Data Archiving.” We consider this to be a foundational component of a comprehensive Information Lifecycle Management strategy.

The application landscape is constantly evolving. For this reason, data archiving is a strategic component of a data growth management strategy. Application owners need a plan to manage data as applications are upgraded, replaced, consolidated, moved to the cloud and/or retired. 

When you don’t have a plan in production, data accumulates in the business application. When this happens, performance bothers the business. In addition, data bloat bothers IT operations. When you don’t have a plan for legacy systems, applications accumulate in the data center. As a result, increasing budgets bother the CFO.

A data growth management plan must include the following:

  • How to cycle through applications and retire them
  • How to smartly store the application data
  • How to ultimately dispose data while staying compliant

Structured data archiving and application retirement technologies help automate and streamline these tasks.

Informatica Data Archive delivers unparalleled connectivity, scalability and a broad range of innovative options (i.e. Smart Partitioning, Live Archiving, and retiring aging and legacy data to the Informatica Data Vault), and comprehensive retention management and data reporting and visualization.  We believe our strengths in this space are the key ingredients for deploying a successful enterprise data archive.

For more information, read the Gartner Magic Quadrant for Structured Data Archiving and Application Retirement.

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Posted in Application ILM, Application Retirement, Data Archiving, Database Archiving, Governance, Risk and Compliance | Tagged , , , , , , | Leave a comment

Regulatory Compliance is an Opportunity, not a Cost!

Regulatory Compliance Regardless of the industry, new regulatory compliance requirements are more often than not treated like the introduction of a new tax.  A few may be supportive, some will see the benefits, but most will focus on the negatives – the cost, the effort, the intrusion into private matters.  There will more than likely be a lot of grumbling.

Across many industries there is currently a lot of grumbling, as new regulation seems to be springing up all over the place.  Pharmaceutical companies have to deal with IDMP in Europe and UDI in the USA.  This is hot on the heels of the US Sunshine Act, which is being followed in Europe by Aggregate Spend requirements.  Consumer Goods companies in Europe are looking at the consequences of beefed up 1169 requirements.  Financial Institutes are mulling over compliance to BCBS-239.  Behind the grumbling most organisations across all verticals appear to have a similar approach to regulatory compliance.  The pattern seems to go like this:

  1. Delay (The requirements may change)
  2. Scramble (They want it when?  Why didn’t we get more time?)
  3. Code to Spec (Provide exactly what they want, and only what they want)

No wonder these requirements are seen as purely a cost and an annoyance.  But it doesn’t have to be that way, and in fact, it should not.  Just like I have seen a pattern in response to compliance, I see a pattern in the requirements themselves:

  1. The regulators want data
  2. Their requirements will change
  3. When they do change, regulators will be wanting even more data!

Now read the last 3 bullet points again, but use ‘executives’ or ‘management’ or ‘the business people’ instead of ‘regulators’.  The pattern still holds true.  The irony is that execs will quickly sign off on budget to meet regulatory requirements, but find it hard to see the value in “infrastructure” projects.  Projects that will deliver this same data to their internal teams.

This is where the opportunity comes in.  pwc’s 2013 State of Compliance Report[i] shows that over 42% of central compliance budgets are in excess of $1m.  A significant figure.  Efforts outside of the compliance team imply a higher actual cost.  Large budgets are not surprising in multi-national companies, who often have to satisfy multiple regulators in a number of countries.  As an alternate to multiple over-lapping compliance projects, what if this significant budget was repurposed to create a flexible data management platform?  This approach could deliver compliance, but provide even more value internally.

Almost all internal teams are currently clamouring for additional data to drive ther newest application.  Pharma and CG sales & marketing teams would love ready access to detailed product information.  So would consumer and patient support staff, as well as down-stream partners.  Trading desks and client managers within Financial Institutes should really have real-time access to their risk profiles guiding daily decision making.  These data needs will not be going away.  Why should regulators be prioritised over the people who drive your bottom line and who are guardians of your brand?

A flexible data management platform will serve everyone equally. Foundational tools for a flexible data management platform exist today including Data Quality,  MDM, PIM and VIBE, Informatica’s Virtual Data Machine.  Each of them play a significant role in easing of regulatory compliance, and as a bonus they deliver measureable business value in their own right.  Implemented correctly, you will get enhanced data agility & visibility across the entire organisation as part of your compliance efforts.  Sounds like ‘Buy one Get One Free’, or BOGOF in retail terms.

Unlike taxes, BOGOF opportunities are normally embraced with open arms.  Regulatory compliance should receive a similar welcome – an opportunity to build the foundations for universal delivery of data which is safe, clean and connected.  A 2011 study by The Economist found that effective regulatory compliance benefits businesses across a wide range of performance metrics[ii].

Is it time to get your free performance boost?


[i] Deeper Insight for Greater Strategic Value, pwc 2013
[ii] Compliance and competitiveness, The Economist 2011
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Posted in Financial Services, Governance, Risk and Compliance, Healthcare | Tagged , , , | Leave a comment

Talk Amongst Yourselves: Why Twitter Needs #DataChat

Listeng to #DataChatWithin Government organizations, technologists are up against a wall of sound. In one ear, they hear consumers cry for faster, better service.

In the other, they hear administrative talk of smaller budgets and scarcer resources.

As stringent requirements for both transparency and accountability grow, this paradox of pressure increases.

Sometimes, the best way to cope is to TALK to somebody.

What if you could ask other data technologists candid questions like:

  • Do you think government regulation helps or hurts the sharing of data?
  • Do you think government regulators balance the privacy needs of the public with commercial needs?
  • What are the implications of big data government regulation, especially for users?
  • How can businesses expedite the government adoption of the cloud?
  • How can businesses aid in the government overcoming the security risks associated with the cloud?
  • How should the policy frameworks for handling big data differ between the government and the private sector?

What if you could tell someone who understood? What if they had sweet suggestions, terrific tips, stellar strategies for success? We think you can. We think they will.

That’s why Twitter needs a #DataChat.

Twitter Needs #DataChat

Third Thursdays, 3:00 PM EST

What on earth is a #DataChat?
Good question. It’s a Twitter Chat – A public dialog, at a set time, on a set topic. It’s something like a crowd-sourced discussion. Any Twitter user can participate simply by including the applicable hashtag in each tweet. Our hashtag is #DataChat. We’ll connect on Twitter, on the third Thursday of each month to share struggles, victories and advice about data governance. We’re going to begin this week, Thursday April 17, at 3:00 PM Eastern Time. For our first chat, we are going to discuss topics that relate to data technologies in government organizations.

What don’t you join us? Tell us about it. Mark your calendar. Bring a friend.

Because, sometimes, you just need someone to talk to.

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Posted in Big Data, Data Governance, Governance, Risk and Compliance, Public Sector | Tagged , , , , | Leave a comment

If you Want Business to “Own” the Data, You Need to Build An Architecture For the Business

If you build an IT Architecture, it will be a constant up-hill battle to get business users and executives engaged and take ownership of data governance and data quality. In short you will struggle to maximize the information potential in your enterprise. But if you develop and Enterprise Architecture that starts with a business and operational view, the dynamics change dramatically. To make this point, let’s take a look at a case study from Cisco. (more…)

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Posted in Business Impact / Benefits, Business/IT Collaboration, CIO, Data Governance, Data Integration, Enterprise Data Management, Governance, Risk and Compliance, Integration Competency Centers | Tagged , , , , | Leave a comment

Murphy’s First Law of Bad Data – If You Make A Small Change Without Involving Your Client – You Will Waste Heaps Of Money

I have not used my personal encounter with bad data management for over a year but a couple of weeks ago I was compelled to revive it.  Why you ask? Well, a complete stranger started to receive one of my friend’s text messages – including mine – and it took days for him to detect it and a week later nobody at this North American wireless operator had been able to fix it.  This coincided with a meeting I had with a European telco’s enterprise architecture team.  There was no better way to illustrate to them how a customer reacts and the risk to their operations, when communication breaks down due to just one tiny thing changing – say, his address (or in the SMS case, some random SIM mapping – another type of address).

Imagine the cost of other bad data (thecodeproject.com)

Imagine the cost of other bad data (thecodeproject.com)

In my case, I  moved about 250 miles within the United States a couple of years ago and this seemingly common experience triggered a plethora of communication screw ups across every merchant a residential household engages with frequently, e.g. your bank, your insurer, your wireless carrier, your average retail clothing store, etc.

For more than two full years after my move to a new state, the following things continued to pop up on a monthly basis due to my incorrect customer data:

  • In case of my old satellite TV provider they got to me (correct person) but with a misspelled last name at my correct, new address.
  • My bank put me in a bit of a pickle as they sent “important tax documentation”, which I did not want to open as my new tenants’ names (in the house I just vacated) was on the letter but with my new home’s address.
  • My mortgage lender sends me a refinancing offer to my new address (right person & right address) but with my wife’s as well as my name completely butchered.
  • My wife’s airline, where she enjoys the highest level of frequent flyer status, continually mails her offers duplicating her last name as her first name.
  • A high-end furniture retailer sends two 100-page glossy catalogs probably costing $80 each to our address – one for me, one for her.
  • A national health insurer sends “sensitive health information” (disclosed on envelope) to my new residence’s address but for the prior owner.
  • My legacy operator turns on the wrong premium channels on half my set-top boxes.
  • The same operator sends me a SMS the next day thanking me for switching to electronic billing as part of my move, which I did not sign up for, followed by payment notices (as I did not get my invoice in the mail).  When I called this error out for the next three months by calling their contact center and indicating how much revenue I generate for them across all services, they counter with “sorry, we don’t have access to the wireless account data”, “you will see it change on the next bill cycle” and “you show as paper billing in our system today”.

Ignoring the potential for data privacy law suits, you start wondering how long you have to be a customer and how much money you need to spend with a merchant (and they need to waste) for them to take changes to your data more seriously.  And this are not even merchants to whom I am brand new – these guys have known me and taken my money for years!

One thing I nearly forgot…these mailings all happened at least once a month on average, sometimes twice over 2 years.  If I do some pigeon math here, I would have estimated the postage and production cost alone to run in the hundreds of dollars.

However, the most egregious trespass though belonged to my home owner’s insurance carrier (HOI), who was also my mortgage broker.  They had a double whammy in store for me.  First, I received a cancellation notice from the HOI for my old residence indicating they had cancelled my policy as the last payment was not received and that any claims will be denied as a consequence.  Then, my new residence’s HOI advised they added my old home’s HOI to my account.

After wondering what I could have possibly done to trigger this, I called all four parties (not three as the mortgage firm did not share data with the insurance broker side – surprise, surprise) to find out what had happened.

It turns out that I had to explain and prove to all of them how one party’s data change during my move erroneously exposed me to liability.  It felt like the old days, when seedy telco sales people needed only your name and phone number and associate it with some sort of promotion (back of a raffle card to win a new car), you never took part in, to switch your long distance carrier and present you with a $400 bill the coming month.  Yes, that also happened to me…many years ago.  Here again, the consumer had to do all the legwork when someone (not an automatic process!) switched some entry without any oversight or review triggering hours of wasted effort on their and my side.

We can argue all day long if these screw ups are due to bad processes or bad data, but in all reality, even processes are triggered from some sort of underlying event, which is something as mundane as a database field’s flag being updated when your last purchase puts you in a new marketing segment.

Now imagine you get married and you wife changes her name. With all these company internal (CRM, Billing, ERP),  free public (property tax), commercial (credit bureaus, mailing lists) and social media data sources out there, you would think such everyday changes could get picked up quicker and automatically.  If not automatically, then should there not be some sort of trigger to kick off a “governance” process; something along the lines of “email/call the customer if attribute X has changed” or “please log into your account and update your information – we heard you moved”.  If American Express was able to detect ten years ago that someone purchased $500 worth of product with your credit card at a gas station or some lingerie website, known for fraudulent activity, why not your bank or insurer, who know even more about you? And yes, that happened to me as well.

Tell me about one of your “data-driven” horror scenarios?

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Posted in Banking & Capital Markets, Business Impact / Benefits, Business/IT Collaboration, Complex Event Processing, Customer Acquisition & Retention, Customer Services, Customers, Data Aggregation, Data Governance, Data Privacy, Data Quality, Enterprise Data Management, Financial Services, Governance, Risk and Compliance, Healthcare, Master Data Management, Retail, Telecommunications, Uncategorized, Vertical | Tagged , , , , , , , , , | Leave a comment

Informatica Remains A Leader In The Gartner 2013 Data Masking MQ

Informatica announced, once again, that it is listed as a leader in the industry’s second Gartner Magic Quadrant for Data Masking Technology. With data security continuing to grow as one of the fastest segments in the enterprise software market, technologies such as data masking are becoming the solution of choice for data-centric security.

Increased fear of cyber-attacks and internal data breaches has made predictions that 2014 is the year of preventative and tactical measures to ensure corporate data assets are safe.  Data masking should be included in those measures.  According to Gartner,

Security program managers need to take a strategic approach with tactical best-practice technology configurations in order to properly address the most common advanced targeted attack scenarios to increase both detection and prevention capabilities.”[1]

Without these measures, the cost of an attack or breach is growing every year.  The Ponemon Institute posted in a recent study:

The 2013 Cost of Cyber Crime Study states that the average annualized cost of cybercrime incurred by a benchmark sample of US organizations was $11.56 million, nearly 78% more than the cost estimated in the first analysis conducted 4 years ago.”[2]

Informatica believes that the best preventative measures include a layered approach for data security but without sacrificing agility or adding unnecessary costs.  Data Masking delivers data-centric security with improved productivity and reduced overall costs.

Data Masking prevents internal data theft and abuse of sensitive data by hiding it from users.  Data masking techniques include replacing some fields with similar-looking characters, masking characters (for example, “x”), substituting real last names with fictional last names and shuffling data within columns – to name a few. Other terms for data masking include data obfuscation, sanitization, scrambling, de-identification, and anonymization .  Call it what you like, but without it – organizations may continue to expose sensitive data to those with mal intentions.

To learn more,  Download the Gartner Magic Quadrant Data Masking Report now. And visit the Informatica website for data masking product information.

About the Magic Quadrant

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose


[1] http://www.gartner.com/newsroom/id/2323615

[2] http://securityaffairs.co/wordpress/18517/cyber-crime/ponemon-2013-cost-of-cyber-crime.html

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Posted in Application ILM, Data Governance, Data masking, Data Privacy, Governance, Risk and Compliance | Tagged , , , , | Leave a comment

Where Is My Broadband Insurance Bundle?

As I continue to counsel insurers about master data, they all agree immediately that it is something they need to get their hands around fast.  If you ask participants in a workshop at any carrier; no matter if life, p&c, health or excess, they all raise their hands when I ask, “Do you have broadband bundle at home for internet, voice and TV as well as wireless voice and data?”, followed by “Would you want your company to be the insurance version of this?”

Buying insurance like broadband

Buying insurance like broadband

Now let me be clear; while communication service providers offer very sophisticated bundles, they are also still grappling with a comprehensive view of a client across all services (data, voice, text, residential, business, international, TV, mobile, etc.) each of their touch points (website, call center, local store).  They are also miles away of including any sort of meaningful network data (jitter, dropped calls, failed call setups, etc.)

Similarly, my insurance investigations typically touch most of the frontline consumer (business and personal) contact points including agencies, marketing (incl. CEM & VOC) and the service center.  On all these we typically see a significant lack of productivity given that policy, billing, payments and claims systems are service line specific, while supporting functions from developing leads and underwriting to claims adjucation often handle more than one type of claim.

This lack of performance is worsened even more by the fact that campaigns have sub-optimal campaign response and conversion rates.  As touchpoint-enabling CRM applications also suffer from a lack of complete or consistent contact preference information, interactions may violate local privacy regulations. In addition, service centers may capture leads only to log them into a black box AS400 policy system to disappear.

Here again we often hear that the fix could just happen by scrubbing data before it goes into the data warehouse.  However, the data typically does not sync back to the source systems so any interaction with a client via chat, phone or face-to-face will not have real time, accurate information to execute a flawless transaction.

On the insurance IT side we also see enormous overhead; from scrubbing every database from source via staging to the analytical reporting environment every month or quarter to one-off clean up projects for the next acquired book-of-business.  For a mid-sized, regional carrier (ca. $6B net premiums written) we find an average of $13.1 million in annual benefits from a central customer hub.  This figure results in a ROI of between 600-900% depending on requirement complexity, distribution model, IT infrastructure and service lines.  This number includes some baseline revenue improvements, productivity gains and cost avoidance as well as reduction.

On the health insurance side, my clients have complained about regional data sources contributing incomplete (often driven by local process & law) and incorrect data (name, address, etc.) to untrusted reports from membership, claims and sales data warehouses.  This makes budgeting of such items like medical advice lines staffed  by nurses, sales compensation planning and even identifying high-risk members (now driven by the Affordable Care Act) a true mission impossible, which makes the life of the pricing teams challenging.

Over in the life insurers category, whole and universal life plans now encounter a situation where high value clients first faced lower than expected yields due to the low interest rate environment on top of front-loaded fees as well as the front loading of the cost of the term component.  Now, as bonds are forecast to decrease in value in the near future, publicly traded carriers will likely be forced to sell bonds before maturity to make good on term life commitments and whole life minimum yield commitments to keep policies in force.

This means that insurers need a full profile of clients as they experience life changes like a move, loss of job, a promotion or birth.   Such changes require the proper mitigation strategy, which can be employed to protect a baseline of coverage in order to maintain or improve the premium.  This can range from splitting term from whole life to using managed investment portfolio yields to temporarily pad premium shortfalls.

Overall, without a true, timely and complete picture of a client and his/her personal and professional relationships over time and what strategies were presented, considered appealing and ultimately put in force, how will margins improve?  Surely, social media data can help here but it should be a second step after mastering what is available in-house already.  What are some of your experiences how carriers have tried to collect and use core customer data?

Disclaimer:
Recommendations and illustrations contained in this post are estimates only and are based entirely upon information provided by the prospective customer  and on our observations.  While we believe our recommendations and estimates to be sound, the degree of success achieved by the prospective customer is dependent upon a variety of factors, many of which are not under Informatica’s control and nothing in this post shall be relied upon as representative of the degree of success that may, in fact, be realized and no warrantee or representation of success, either express or implied, is made.
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Posted in B2B, Big Data, Business Impact / Benefits, Business/IT Collaboration, CIO, Customer Acquisition & Retention, Customer Services, Customers, Data Governance, Data Privacy, Data Quality, Data Warehousing, Enterprise Data Management, Governance, Risk and Compliance, Healthcare, Master Data Management, Vertical | Tagged , , , , , , , , | Leave a comment

Sensational Find – $200 Million Hidden in a Teenager’s Bedroom!

That tag line got your attention – did it not?  Last week I talked about how companies are trying to squeeze more value out of their asset data (e.g. equipment of any kind) and the systems that house it.  I also highlighted the fact that IT departments in many companies with physical asset-heavy business models have tried (and often failed) to create a consistent view of asset data in a new ERP or data warehouse application.  These environments are neither equipped to deal with all life cycle aspects of asset information, nor are they fixing the root of the data problem in the sources, i.e. where the stuff is and what it look like. It is like a teenager whose parents have spent thousands of dollars on buying him the latest garments but he always wears the same three outfits because he cannot find the other ones in the pile he hoardes under her bed.  And now they bought him a smart phone to fix it.  So before you buy him the next black designer shirt, maybe it would be good to find out how many of the same designer shirts he already has, what state they are in and where they are.

Finding the asset in your teenager's mess

Finding the asset in your teenager’s mess

Recently, I had the chance to work on a like problem with a large overseas oil & gas company and a North American utility.  Both are by definition asset heavy, very conservative in their business practices, highly regulated, very much dependent on outside market forces such as the oil price and geographically very dispersed; and thus, by default a classic system integration spaghetti dish.

My challenge was to find out where the biggest opportunities were in terms of harnessing data for financial benefit.

The initial sense in oil & gas was that most of the financial opportunity hidden in asset data was in G&G (geophysical & geological) and the least on the retail side (lubricants and gas for sale at operated gas stations).  On the utility side, the go to area for opportunity appeared to be maintenance operations.  Let’s say that I was about right with these assertions but that there were a lot more skeletons in the closet with diamond rings on their fingers than I anticipated.

After talking extensively with a number of department heads in the oil company; starting with the IT folks running half of the 400 G&G applications, the ERP instances (turns out there were 5, not 1) and the data warehouses (3), I queried the people in charge of lubricant and crude plant operations, hydrocarbon trading, finance (tax, insurance, treasury) as well as supply chain, production management, land management and HSE (health, safety, environmental).

The net-net was that the production management people said that there is no issue as they already cleaned up the ERP instance around customer and asset (well) information. The supply chain folks also indicated that they have used another vendor’s MDM application to clean up their vendor data, which funnily enough was not put back into the procurement system responsible for ordering parts.  The data warehouse/BI team was comfortable that they cleaned up any information for supply chain, production and finance reports before dimension and fact tables were populated for any data marts.

All of this was pretty much a series of denial sessions on your 12-step road to recovery as the IT folks had very little interaction with the business to get any sense of how relevant, correct, timely and useful these actions are for the end consumer of the information.  They also had to run and adjust fixes every month or quarter as source systems changed, new legislation dictated adjustments and new executive guidelines were announced.

While every department tried to run semi-automated and monthly clean up jobs with scripts and some off-the-shelve software to fix their particular situation, the corporate (holding) company and any downstream consumers had no consistency to make sensible decisions on where and how to invest without throwing another legion of bodies (by now over 100 FTEs in total) at the same problem.

So at every stage of the data flow from sources to the ERP to the operational BI and lastly the finance BI environment, people repeated the same tasks: profile, understand, move, aggregate, enrich, format and load.

Despite the departmental clean-up efforts, areas like production operations did not know with certainty (even after their clean up) how many well heads and bores they had, where they were downhole and who changed a characteristic as mundane as the well name last and why (governance, location match).

Marketing (Trading) was surprisingly open about their issues.  They could not process incoming, anchored crude shipments into inventory or assess who the counterparty they sold to was owned by and what payment terms were appropriate given the credit or concentration risk associated (reference data, hierarchy mgmt.).  As a consequence, operating cash accuracy was low despite ongoing improvements in the process and thus, incurred opportunity cost.

Operational assets like rig equipment had excess insurance coverage (location, operational data linkage) and fines paid to local governments for incorrectly filing or not renewing work visas was not returned for up to two years incurring opportunity cost (employee reference data).

A big chunk of savings was locked up in unplanned NPT (non-production time) because inconsistent, incorrect well data triggered incorrect maintenance intervals. Similarly, OEM specific DCS (drill control system) component software was lacking a central reference data store, which did not trigger alerts before components failed. If you add on top a lack of linkage of data served by thousands of sensors via well logs and Pi historians and their ever changing roll-up for operations and finance, the resulting chaos is complete.

One approach we employed around NPT improvements was to take the revenue from production figure from their 10k and combine it with the industry benchmark related to number of NPT days per 100 day of production (typically about 30% across avg depth on & offshore types).  Then you overlay it with a benchmark (if they don’t know) how many of these NPT days were due to bad data, not equipment failure or alike, and just fix a portion of that, you are getting big numbers.

When I sat back and looked at all the potential it came to more than $200 million in savings over 5 years and this before any sensor data from rig equipment, like the myriad of siloed applications running within a drill control system, are integrated and leveraged via a Hadoop cluster to influence operational decisions like drill string configuration or asmyth.

Next time I’ll share some insight into the results of my most recent utility engagement but I would love to hear from you what your experience is in these two or other similar industries.

Disclaimer:
Recommendations contained in this post are estimates only and are based entirely upon information provided by the prospective customer  and on our observations.  While we believe our recommendations and estimates to be sound, the degree of success achieved by the prospective customer is dependent upon a variety of factors, many of which are not under Informatica’s control and nothing in this post shall be relied upon as representative of the degree of success that may, in fact, be realized and no warrantee or representation of success, either express or implied, is made.
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Posted in Application Retirement, B2B, Big Data, Business Impact / Benefits, Business/IT Collaboration, CIO, Data Aggregation, Data Governance, Data Integration, Data Quality, Enterprise Data Management, Governance, Risk and Compliance, Manufacturing, Master Data Management, Mergers and Acquisitions, Operational Efficiency, Uncategorized, Utilities & Energy, Vertical | Tagged , , , , , , , | Leave a comment