Tag Archives: MDM
Insurance is a highly competitive business that hinges on providing the right products and industry-leading service to customers. Accurate data is the lifeblood of this business. To overcome their struggle with fragmented data across product lines, functions and channels, a leading US-based insurance company has built a world-class information management practice to enable the company to quickly collect and analyze data, whether it is financial, claims, policy or customer data.
“Our advances in technology and distribution channel diversification along with increased brand awareness and innovative products and services — are moving us closer to our goal of becoming a top-five personal lines carrier, “ said the president of the insurance company.
Delivering real-time access to the Total Customer Relationship across channels, functions and product lines
The insurance company’s data integration and data management initiative included:
- an Enterprise Data Warehouse (EDW) from Teradata,
- reporting from MicroStrategy, and
- data integration and master data management (MDM) technology from Informatica to better manage customer and policy data.
This provides the information infrastructure required to propel the insurance company’s personal insurance business into the top tier of personal insurers in the country.
Business analysts in claims, marketing, policy and finance as well as agents in the field, sales people and claims adjusters now have access to clean, consistent and connected customer information for analytics, performance measurement and decision-making.
Within their business applications, the Information Management team has delivered real-time access to the total customer relationship across product lines, channels and functions.
How did they do it?
The team identified the data sources that contain valuable customer information. They’re accessing that customer information using data integration and bringing into a central location, the Informatica MDM hub, where it’s managed, mastered and shared with downstream systems on an ongoing basis, again using data integration. The company now has a “golden record” for each customer, policy and claim and the information continuously updated.
- Claims: The customer information management initiative was instrumental in the successful implementation of a new system to streamline and optimize the company’s claims process. The data integration/data management team leveraged a strong relationship with the claims team to delve into business needs, design the system, and build it from the ground up. Better knowledge of the total customer relationship is accelerating the claims process, leading to increased customer satisfaction and employee performance.
- Sales & Customer Service: Now when a customer logs into the company’s website, the system makes a call to the Informatica MDM hub and immediately finds out every policy, every claim, and all other relevant data on the customer and displays it on the screen. Better knowledge of the total customer relationship is leading to better and more relevant insurance products and services, higher customer satisfaction and better sales, marketing and agent performance.
Please join us on Thursday, February 5th at 11am PT for a webinar. You will learn how OneAmerica®, which offers life insurance, retirement services and employee benefits, is shifting from a policy-centric to a customer-centric operation. Nicolas Lance, Vice President of Retirement Income Strategies and Head of Customer Data will explain how this shift will enable the company to improve customer experience and marketing, distribution partner and call and service center effectiveness.
Register here: http://infa.media/1xWlHop
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.
The last few months have allowed me to see MDM, data quality and data governance from a completely different perspective. I sat with other leaders here at Informatica, analysts who focus on information quality and spent time talking to our partners who work closely with customers on data management initiatives. As we collectively attempted to peer into the crystal ball and forecast what will be hot – and what will not – in this year and beyond for MDM and data quality, here are few top predictions that stood out.
1. MDM will become a single platform for all master entities
“The classical notion of boundaries that existed where we would say, this is MDM versus this is not MDM is going to get blurred,” says Dennis Moore – SVP, Information Quality Solutions (IQS), Informatica. “Today, we master a fairly small number of attributes in MDM. Rather than only mastering core attributes, we need to master business level entities, like customer, product, location, assets, things, etc., and combine all relevant attributes into a single platform which can be used to develop new “data fueled” applications. This platform will allow mastering of data, aggregate data from other sources, and also syndicate that data out into other systems.”
Traditionally MDM was an invisible hub that was connected to all the spokes. Instead, Dennis says – “MDM will become more visible and will act as an application development platform.”
2. PIM is becoming more integrated environment that covers all information about products and related data in single place
More and more customers want to have single interface which will allow them to manage all product information. Along with managing a product’s length, width, height, color, cost etc., they probably want to see data about the history, credit rating, previous quality rating, sustainability scorecard, returns, credits and so on. Dennis says – “All the product information in one place helps make better decisions with embedded analytics, giving answers to questions such as:
- What were my sales last week?
- Which promotions are performing well and poorly?
- Which suppliers are not delivering on their SLAs?
- Which stores aren’t selling according to plan?
- How are the products performing in specific markets?”
Essentially, PIM will become a sovereign supplier of product data that goes in your catalog and ecommerce system that will be used by merchandisers, buyers, and product and category managers. It will become the buyer’s guide and a desktop for the person whose job is to figure out how to effectively promote products to meet sales targets.
3. MDM will become an integral part of big data analytics projects
“Big data analytics suffers from the same challenges as traditional data warehouses – bad data quality produces sub-optimal intelligence. MDM has traditionally enabled better analysis and reporting with high quality master data. Big data analytics will also immensely benefit from MDM’s most trustworthy information.” – Said Ravi Shankar – VP of Product Marketing, MDM, Informatica
Naveen Sharma who heads Enterprise Data Management practice at Cognizant reemphasized what I heard from Dennis. He says – “With big data and information quality coming together, some of the boundaries between a pure MDM system and a pure analytical system will start to soften”. Naveen explains – “MDM is now seen as an integral part of big data analytics projects and it’s a huge change from a couple of years ago. Two of large retailers we work with are going down the path of trying to bring not only the customer dimension but the associated transactional data to derive meaning into an extended MDM platform. I see this trend continuing in 2015 and beyond with other verticals as well.”
4. Business requirements are leading to the creation of solutions
There are several business problems being solved by MDM, such as improving supplier spend management and collaboration with better supplier data. Supply chain, sourcing and procurement teams gain significant cost savings and a boost in productivity by mastering supplier, raw materials and product information and fueling their business and analytical applications with that clean, consistent and connected information. Jakki Geiger, Senior Director of IQS Solutions Marketing at Informatica says, “Business users want more than just the underlying infrastructure to manage business-critical data about suppliers, raw materials, and products. They want to access this information directly through a business-friendly user interface. They want a business process-driven workflow to manage the full supplier lifecycle, including: supplier registration, qualification, verification, onboarding and off-boarding. Instead of IT building these business-user focused solutions on top of an MDM foundation, vendors are starting to build ready-to-use MDM solutions like the Total Supplier Relationship solution.” Read more about Valspar’s raw materials spend management use case.
5. Increased adoption of matching and linking capabilities on Hadoop
“Many of our customers have significantly increased the amount of data they want to master,” says Dennis Moore. Days when tens of millions of master records were a lot are long gone and having hundreds of millions of master records and billions of source records is becoming almost common. An increasing number of master data sources –internal and external to organization – are contributing significantly to the rise in data volumes. To accommodate these increasing volumes, Dennis predicts that large enterprises will look at running complex matching and linking capabilities on Hadoop – a cost effective and flexible way to analyze large amount of data.
6. Master insight management is going to be next big step
“MDM will evolve into master insight management as organizations try to relate trusted data they created in MDM with transactional and social interaction data,” said Rob Karel – VP of Product Strategy and Product Marketing, IQS, Informatica. “The innovations in machine and deep learning techniques will help organizations such as healthcare prescribe next best treatment based on history of patients, retailers suggest best offers based on customer interest and behavior, public sector companies will see big steps in social services, etc.”
Rob sees MDM at the heart of this innovation bringing together relevant information about multiple master entities and acting as a core system for insight management innovations.
7. MDM and Data Governance
Aaron Zornes – Chief research officer at the MDM Institute predicts that in 2014-15, vendor MDM solutions will move from “passive-aggressive” mode to “proactive” data governance mode. Data governance for MDM will move beyond simple stewardship to convergence of task management, workflow, policy management and enforcement according to Aaron.
8. The market will solidify for cloud based MDM adoption
Aaron says – “Cloud-innate services for DQ and DG will be more prevalent; however, enterprise MDM will remain on premise with increasing integration to cloud applications in 2015.
Naveen sees lot of synergy around cloud based MDM offerings and says – “The market is solidifying for MDM on cloud but the flood gates are yet to open”. Naveen does not see any reason why MDM market will not go to cloud and gives the example of CRM which was at similar junction before Saleforce came into play. Naveen sees similar shift for MDM and says – “The fears companies have about their data security on cloud is eventually going to fade. If you look closely at any of the recent breaches, these all involved hacks into company networks and not into cloud provider networks. The fact that cloud service providers spend more dollars on data security than any one company can spend on their on-premise security layer will be a major factor affecting the transition”. Naveen sees that big players in MDM will include cloud offerings as part of their toolkit in coming years.
Ravi also predicts an increase in cloud adoption for MDM in future as the concern for placing master data in the cloud becomes less with maximum security provided by cloud vendors.
So, what do you predict? I would love to hear your opinions and comments.
Part 1 of this blog touched on the differences between PIM and Product MDM. Since both play a role in ensuring the availability of high quality product data, it is easy to see the temptation to extend the scope of either product to play a more complete part. However, there are risks involved in customising software. PIM and MDM are not exceptions, and any customisations will carry some risk.
In the specific case of looking to extend the role of PIM, the problems start if you just look at the data and think: “oh, this is just a few more product attributes to add”. This will not give you a clear picture of the effort or risk associated with customisations. A complete picture requires looking beyond the attributes as data fields, and considering them in context: which processes and people (roles) are supported by these attributes?
Recently we were asked to assess the risk of PIM customisation for a customer. The situation was that data to be included in PIM was currently housed in separate, home grown and aging legacy systems. One school of thought was to move all the data, and their management tasks, into PIM and retire the three systems. That is, extending the role of PIM beyond a marketing application and into a Product MDM role. In this case, we found three main risks of customising PIM for this purpose. Here they are in more detail:
1. Decrease speed of PIM deployment
- Inclusion of the functionality (not just the data) will require customisations in PIM, not just additional attributes in the data model.
- Logic customisations are required for data validity checks, and some value calculations.
- Additional screens, workflows, integrations and UI customisations will be required for non-marketing roles
- PIM will become the source for some data, which is used in critical operational systems (e.g. SAP). Reference checks & data validation cannot be taken lightly due to risks of poor data elsewhere.
- Bottom line: A non-standard deployment with drive up implementation cost, time and risk.
2. Reduce marketing agility
- In the case concerned, whilst the additional data was important to marketing, it is primarily supporting by non-marketing users and processes including Product Development, Sales and Manufacturing
- These systems are key systems in their workflow in terms of creating and distributing technical details of new products to other systems, e.g. SAP for production
- If the systems are retired and replaced with PIM, these non-marketing users will need to be equal partners in PIM:
- Require access and customised roles
- Influence over configuration
- Equal vote in feature/function prioritisation
- Bottom Line: Marketing will no longer completely own the PIM system, and may have to sacrifice new functionality to prioritise supporting other roles.
3. Risk of marketing abandoning the hybrid tool in the mid-term
- An investment in PIM is usually an investment by Marketing to help them rapidly adapt to a dynamic external market.
- System agility (point 2) is key to rapid adaption, as is the ability to take advantage of new features within any packaged application.
- As more customisations are made, the cost of upgrades can become prohibitive, driven by the cost to upgrade customisations.
- Cost often driven by consulting fees to change what could be poorly documented code.
- Risk of falling behind on upgrades, and hence sacrificing access to the newest PIM functionality
- If upgrades are more expensive than new tools, PIM will be abandoned by Marketing, and they will invest in a new tool.
- Bottom line: In a worst case scenario, a customised PIM solution could be left supporting non-marketing functionality with Marketing investing in a new tool.
The first response to the last bullet point is normally “no they wouldn’t”. Unfortunately this is a pattern both I and some of my colleagues have seen in the area of marketing & eCommerce applications. The problem is that these areas are so fast moving, that nobody can afford to fall behind in terms of new functionality. If upgrades are large projects which need lengthy approval and implementation cycles, marketing is unlikely to wait. It is far easier to start again with a smaller budget under their direct control. (Which is where PIM should be in the first place.)
- Making PIM look and behave like Product MDM could have some undesirable consequences – both in the short term (current deployment) and in the longer term (application abandonment).
- A choice for customising PIM vs. enhancing your landscape with Product MDM should be made not on data attributes alone.
- Your business and data processes should guide you in terms of risk assessment for customisation of your PIM solution.
Bottom Line: If the risks seem too large, then consider enhancing your IT landscape with Product MDM. Trading PIM cost & risk for measurable business value delivered by MDM will make a very attractive business case.
Citrix: You may not realize you know them, but chances are pretty good that you do. And chances are also good that we marketers can learn something about achieving fortune teller-like marketing from them!
Citrix is the company that brought you GoToMeeting and a whole host of other mobile workspace solutions that provide virtualization, networking and cloud services. Their goal is to give their 100 million users in 260,000 organizations across the globe “new ways to work better with seamless and secure access to the apps, files and services they need on any device, wherever they go.”
Citrix is a company that has been imagining and innovating for over 25 years, and over that time, has seen a complete transformation in their market – virtual solutions and cloud services didn’t even exist when they were founded. Now it’s the backbone of their business. Their corporate video proudly states that the only constant in this world is change, and that they strive to embrace the “yet to be discovered.”
Having worked with them quite a bit over the past few years, we have seen first-hand how Citrix has demonstrated their ability to embrace change.
Back in 2011, it became clear to Citrix that they had a data problem, and that they would have to make some changes to stay ahead in this hyper competitive market. Sales & Marketing had identified data as their #1 concern – their data was incomplete, inaccurate, and duplicated in their CRM system. And with so many different applications in the organization, it was quite difficult to know which application or data source had the most accurate and up-to-date information. They realized they needed a single source of the truth – one system of reference where all of their global data management practices could be centralized and consistent.
The marketing team realized that they needed to take control of the solution to their data concerns, as their success truly depended upon it. They brought together their IT department and their systems integration partner, Cognizant to determine a course of action. Together they forged an overall data governance strategy which would empower the marketing team to manage data centrally – to be responsible for their own success.
As a key element of that data governance / management strategy, they determined that they needed a Master Data Management (MDM) solution to serve as their Single Trusted Source of Customer & Prospect Data. They did a great deal of research into industry best practices and technology solutions, and decided to select Informatica as their MDM partner. As you can see, Citrix’s environment is not unlike most marketing organizations. The difference is that they are now able to capture and distribute better customer and prospect data to and from these systems to achieve even better results. They are leveraging internal data sources and systems like CRM (Salesforce) and marketing automation (Marketo). Their systems live all over the enterprise, both on premises and in the cloud. And they leverage analytical tools to analyze and dashboard their results.
Citrix strategized and implemented their Single Trusted Source of Customer & Prospect solution in a phased approach throughout 2013 and 2014, and we believe that what they’ve been able to accomplish during that short period of time has been nothing short of phenomenal. Here are the higlights:
- Used Informatica MDM to provide clean, consistent and connected channel partner, customer and prospect data and the relationships between them for use in operational applications (SFDC, BI Reporting and Predictive Analytics)
- Recognized 20% increase in lead-to-opportunity conversion rates
- Realized 20% increase in marketing team’s operational efficiency
- Achieved 50% increase in quality of data at the point of entry, and a 50% reduction in the rate of junk and duplicate data for prospects, existing accounts and contact
- Delivered a better channel partner and customer experience by renewing all of a customers’ user licenses across product lines at one time and making it easy to identify whitespace opportunities to up-sell more user licenses
That is huge! Can you imagine the impact on your own marketing organization of a 20% increase in lead-to-opportunity conversion? Can you imagine the impact of spending 20% less time questioning and manually massaging data to get the information you need? That’s game changing!
Because Citrix now has great data and great resulting insight, they have been able to take the next step and embark on new fortune teller-like marketing strategies. As Citrix’s Dagmar Garcia discussed during a recent webinar, “We monitor implicit and explicit behavior of transactional leads and accounts, and then we leverage these insights and previous behaviors to offer net new offers and campaigns to our customers and prospects… And it’s all based on the quality of data we have within our database.”
I encourage you to take a few minutes to listen to Dagmar discuss Citrix’s project on a recent webinar. In the webinar, she dives deeper into their project, the project scope and timeline, and to what she means by “fortune telling abilities”. Also, take a look at the customer story section of the Informatica.com website for the PDF case study. And, if you’re in the mood to learn more, you can download a complimentary copy of the 2014 Gartner Magic Quadrant for MDM of Customer Data Solutions.
Hat’s off to you Citrix, and we look forward to working with you to continue to change the game even more in the coming months and years!
Working for Informatica has many advantages. One of them is that I clearly understand the difference between Product Information Management (PIM) and Master Data Management (MDM) for product data[i]. Since I have this clear in my own mind, it is easy to forget that this may not be as obvious to others. As frequently happens, it takes a customer to help us articulate why PIM is not the same as Product MDM. Now that this is fresh in my mind again, I thought I would share why the two are different, and when you should consider each one, or both.
In a lengthy discussion with our customer, many points were raised, discussed and classified. In the end, all arguments essentially came down to each technology’s primary purpose. A different primary purpose means that typical capabilities of the two products are geared towards different audiences and use cases.
PIM is a business application that centralizes and streamlines the creation and enhancement of consistent, but localised product content across channels. (Figure 1)
Figure 1: PIM Product Data Creation Flow
Product MDM is an infrastructure component that consolidates the core global product data that should be consistent across multiple and diverse systems and business processes, but typically isn’t. (Figure 2)
Figure 2: MDM Product Data Consolidation Hub
The choice between the two technologies really comes down the current challenge you are trying to solve. If you cannot get clean and consistent data out through all your sales channels fast enough, then a PIM solution is the correct choice for you. However, if your organisation is making poor decisions and seeing bloated costs (e.g. procurement or inventory costs) due to poor internal product data, then MDM technology is the right choice.
But, if it is so simple – why I am even writing this down? Why are the lines blurring now?
Here is my 3-part theory:
- A focus on good quality product data is relatively recent trend. Different industries started by addressing different challenges.
- PIM has primarily been used in retail B2C environments and distributor B2B or B2C environments. That is, organisations which are primarily focused around the sale of a product, rather than the design and production of the product.
- Product MDM has been used predominately by manufacturers of goods, looking to standardise and support global processes, reporting and analytics across departments.
- Now, manufacturers are increasingly looking to take control of their product information outside their organisation.
- This trend is most notable in Consumer Goods (CG) companies.
- Increasingly consistent, appealing and high quality data in the consumer realm is making the difference between choosing your product vs. a competitor’s.
- CG must ensure all channels – their own and their retail partner’s – are fed with high quality product data.
- So PIM is now entering organisations which should already have a Product MDM tool. If they don’t, confusion arises.
- When Marketing buys PIM (and it normally is Marketing), quite frankly this shows up the poor product data management upstream of marketing.
- It becomes quite tempting to try to jam as much product data into a PIM system as possible, going beyond the original scope of PIM.
The follow-on question is clear: why can’t we just make a few changes and use PIM as our MDM technology, or MDM as our PIM solution? It is very tempting. Both data models can be extended to add extra fields. In Informatica’s case, both are supported by a common, feature-rich workflow tool. However, there are inherent risks in using PIM where Product MDM is needed or Product MDM where PIM is needed.
After discussions with our customer, we identified 3 risks of modifying PIM when it is really Product MDM functionality that is needed:
- Decrease speed of PIM deployment
- Reduce marketing agility
- Risk of marketing abandoning the hybrid tool in the mid-term
The last turned out to be the least understood, but that doesn’t make it any less real. Since each of these risks deserves more explanation, I will discuss them in Part 2 of this Blog. (Still to be published)
In summary, PIM and Product MDM are designed to play different roles in the quest for the availability of high quality product data both internally and externally. There are risks and costs associated with modifying one to take on the role of the other. In many cases there is place for both PIM and MDM, but you will still need to choose a starting point. Each journey to high quality product data will be different, but the goal is still the same – to turn product data into business value.
I (or one of my colleagues in a city near you) will be happy to help you understand what the best starting point is for your organisation.
[i] In case you were wondering, this is not the benefit that I joined Informatica for.
“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
Get connected. Be connected. Make connections. Find connections. The Internet of Things (IoT) is all about connecting people, processes, data and, as the name suggests, things. The recent social media frenzy surrounding the ALS Ice Bucket Challenge has certainly reminded everyone of the power of social media, the Internet and a willingness to answer a challenge. Fueled by personal and professional connections, the craze has transformed fund raising for at least one charity. Similarly, IoT may potentially be transformational to the business of the public sector, should government step up to the challenge.
Government is struggling with the concept and reality of how IoT really relates to the business of government, and perhaps rightfully so. For commercial enterprises, IoT is far more tangible and simply more fun. Gaming, televisions, watches, Google glasses, smartphones and tablets are all about delivering over-the-top, new and exciting consumer experiences. Industry is delivering transformational innovations, which are connecting people to places, data and other people at a record pace.
It’s time to accept the challenge. Government agencies need to keep pace with their commercial counterparts and harness the power of the Internet of Things. The end game is not to deliver new, faster, smaller, cooler electronics; the end game is to create solutions that let devices connecting to the Internet interact and share data, regardless of their location, manufacturer or format and make or find connections that may have been previously undetectable. For some, this concept is as foreign or scary as pouring ice water over their heads. For others, the new opportunity to transform policy, service delivery, leadership, legislation and regulation is fueling a transformation in government. And it starts with one connection.
One way to start could be linking previously siloed systems together or creating a golden record of all citizen interactions through a Master Data Management (MDM) initiative. It could start with a big data and analytics project to determine and mitigate risk factors in education or linking sensor data across multiple networks to increase intelligence about potential hacking or breaches. Agencies could stop waste, fraud and abuse before it happens by linking critical payment, procurement and geospatial data together in real time.
This is the Internet of Things for government. This is the challenge. This is transformation.
This blog post feels a little bit like bragging… and OK, I guess it is pretty self-congratulatory to announce that this year, Informatica was again chosen as a leader in MDM and PIM by The Information Difference. As you may know, The Information Difference is an independent research firm that specializes in the MDM industry and each year surveys, analyzes and ranks MDM and PIM providers and customers around the world. This year, like last year, The Information Difference named Informatica tops in the space.
Why do I feel especially chuffed about this? Because of our customers.