Informatica Perspectives

2010 planning is in full swing at Informatica, as well as for many of our customers. One thing is clear—organizations are far more data-driven than ever before. Given the constant change in the economic climate, we performed rigorous analysis on trends and did forecasting by geography, size, product segment, and many other dimensions throughout the year more frequently than in the past. In this blog article, I’d like to share the seven success habits of a data-driven enterprise based on my personal observations.

1. Take a fresh look at your strategies and assumptions with year-to-date data
In 2009, many companies put more emphasis on cross-selling and up-selling to existing customers given the general decline in consumption and fear of overspending on acquiring new customers. Others looked to gain new customers at relatively low entry points. Organizations tend to have an “old” memory and ask the same questions over and over when in fact, the questions are no longer the right ones. External changes including financial trends and competitive dynamics could result in making your strategies outdated or your assumptions invalid. It’s imperative for us to sit back and ask: Are our strategies still sound? What assumptions do we need to revisit?

2. Review go-to-market effort from the data-flow perspective

We have engaged in information management projects that involve back-end analytics and operational applications. The effort could be driven from IT or business. In many cases, we have focused on specific applications or initiatives without looking at the data flow as a whole. We continued to see the proliferation of data repositories and data stores from new applications. For instance, a typical blind spot was that products were not accompanied with the right sales and service strategies. Managing sales capacity based on opportunity was a key challenge. Do you have the right mix of a direct and an indirect salesforce to handle the selling effort matched to the demand? Is your infrastructure adequate to support forecasting and supplier negotiations? We may need to go back to the drawing board to see if there is an area of inefficiency or we are overlooking an area of profitable growth. Can you follow the data to follow the money?

3. Secure and strengthen sponsorships for mission-critical, information management initiatives

Talking to organizations that have succeeded in complex, multi-year information management initiatives, I am amazed how often the topic of executive sponsorship comes up. It’s hard to nurture a data-driven culture without the right leadership but once you have your sponsors, it is even more critical that you build it into something that you can count on. High profile projects often demand organizational changes and political headwind. How often do you meet with your sponsors? Do they know your successes and challenges? What can you do to motivate them to do the things you need?

4. Take governance and process seriously without hindering execution

I have great respect and admiration for entrepreneurship and first-class execution. Companies who have made it to the head of the pack after the challenging market conditions are almost always fast movers. I also notice how well their information management strategies are aligned with corporate-wide governance, policy and process. They tackle the governance aspect first and then the technology selection is often made to support the business process and fiduciary responsibilities. Governance and process excellence serve as the foundation for demonstrating competitive performance without having to worry about the basic underpinnings during the race. Is your governance model up-to-date with the proper controls and change management to execute with speed and precision?

5. Test alignment of your initiatives and projects with core themes and strategies

After coming up with a running list of projects and initiatives, we often notice that certain initiatives and projects do not have alignment with the core themes, or certain themes or strategies do not have active supporting programs. A data-driven approach makes it far easier to test whether you have the right mix of projects and initiatives for a given set of themes. Growth figures like 50% can be deceiving if it is from a very small revenue producing segment or due to an “outlier” business with respect to the overall business impact. Do you have information to back up your priorities and a combination of operational activities to support your strategies?

6. Anticipate and manage the politics of data

Most companies have multiple owners of data based on subject areas like financial, customer, product, supplier, sales, etc. During the analysis and planning phase, you may encounter resistance from certain organizations to release information, let alone agree to discuss the trend. This could be a time-consuming, frustrating undertaking. Experienced organizations understand this well and give extra time to get alignment and sort through issues across business units and functional areas. Do you count on interlock meetings and documents to achieve alignment among various groups? What are your escalation paths and alternative resource models?

7. Drive value from execution with “imperfect, but necessary” information

I bet you have been there. After much assessment of hundreds (or even thousands) of spreadsheets, you feel you know your business but there is some doubt. ‘Analysis paralysis’ can be a potential side-effect of the data-driven approach if you look for perfection in data. High performing organizations focus on trends and patterns and interdependent dynamics within a company. They don’t spend lots of time arguing about the details that may not have the material impact on their strategies or operating plan. Are you data-driven for the sake of business or for the sake of data? We need to avoid getting into the trap of becoming data-driven for the sake of data. Our effort should be business-led and IT-supported.

I wish you all good luck in your end-of-year activities. Please let me know if you have additional success habits you’d like to share.