Zornes' keynote maximizing business outcomes – ‘master data governance’ to unify bpm & mdm -...

Conference Chairman’s Keynote

Maximizing Business Outcomes – ‘Master Data

Governance’ to Unify BPM & MDM

7th Annual

MDM & Data Governance Summit

October 15, 2012

Aaron ZornesChief Research Officer

The MDM Institute [email protected]

www.linkedin.com/in/aaronzornes @azornes

+1 650.743.2278

© 2012 The MDM Institute www.The-MDM-Institute.com

About the MDM Institute

Founded 2004 to focus on MDM business drivers & technology challenges

MDM Advisory Council™ of 150 Global 5000 IT organizations with unlimited advice to key individuals, e.g. CTOs, CIOs, data architects

MDM Business Council™ website access & email support to 35,000+ members

MDM Road Map & Milestones™ annual strategic planning assumptions

MDM Alert™ newsletter

MDM Market Pulse™ monthly surveys

MDM Fast Track™ one-day public & onsite workshop rotating quarterly through major North American, European, & Asia-Pacific metro areas

MDM & Data Governance Summit™ annual conferences in

NYC, San Francisco, London, Singapore, Sydney, Toronto, & Tokyo

“Independent, Authoritative, & Relevant”

About Aaron Zornes Leadingindustry analyst authority on topics of MDM & Data Governance

Founder & Chief Research Officer of the MDM Institute Conference chairman for Information Mgmt’s MDM & DG SUMMIT conference

series Founded & ran META Group’s largest research practice for 14 years M.S. in Management Information Systems from University of Arizona


MDM Institute Advisory Council

150 organizations who receive unlimited MDM advice to key individuals, e.g. CTOs, CIOs, & MDM project leads

Representative Members 3M BCD Travel Bell Canada Caterpillar Cisco Systems COUNTRY Financials Educational Testing Svcs Embraer GE Healthcare Honeywell Information Handling Svcs Intuit Loblaw McKesson Medtronic Microsoft Motorola National Australia Bank


Nationwide Insurance Norwegian Cruise Lines Novartis PC Connection Polycom Pratt & Whitney Canada Roche Labs Rogers Communications Scholastic Sony Pictures Entertainment Stryker SunTrust Sutter Health TUI W.W. Grainger Westpac Weyerhaeuser Woolworths

MDM & Data Governance Summit™Conference Series


“More MDM programs get their successful start at MDM & Data Governance Summits than anywhere else”

MDM & Data Governance Summit New YorkMDM & Data Governance Summit New YorkMarriott Marquis NYC Times Square ▪ October 14-16Marriott Marquis NYC Times Square ▪ October 14-16

MDM & Data Governance Summit SingaporeMDM & Data Governance Summit SingaporeMarina Bay Sands Resort ▪ December 4-5Marina Bay Sands Resort ▪ December 4-5

MDM & Data Governance Summit ShanghaiMDM & Data Governance Summit ShanghaiShanghai International Convention Center ▪ March 2013

MDM & Data Governance Summit Europe MDM & Data Governance Summit Europe Radisson BLU – London ▪ April 15-17, 2013Radisson BLU – London ▪ April 15-17, 2013

MDM & Data Governance Summit Asia-Pacific MDM & Data Governance Summit Asia-Pacific Four Points Darling Harbour– Sydney ▪ May 20-21, 2013 Four Points Darling Harbour– Sydney ▪ May 20-21, 2013

MDM & Data Governance Summit San FranciscoMDM & Data Governance Summit San FranciscoHyatt Embarcadero – San Francisco ▪ May 2013Hyatt Embarcadero – San Francisco ▪ May 2013

MDM & Data Governance Tokyo MDM & Data Governance Tokyo Belle Salle Kanda– Tokyo ▪ June 2013Belle Salle Kanda– Tokyo ▪ June 2013

MDM & Data Governance Summit Canada MDM & Data Governance Summit Canada The Carlu – Toronto ▪ June 2013The Carlu – Toronto ▪ June 2013

MDM Market Growth

CDI (MDM of Customer) s/w US$644 million market YE2012 US$1 billion by YE2015

PIM (MDM of Product) s/w -- incl store content info & metadata

US$688 million market YE 2012 US$1.1 billion by YE2015

> 50% of MDM revenue is led by offerings from small & best-of-breed vendors Therefore overall market surge will likely bring with it a

host of smaller competitive mergers in addition to more specialty vendor buyouts by four largest MDM providers – IBM, Informatica, Oracle & SAP.

© 2010 The MDM Institute The-MDM-Institute.com

** Source: Gartner Research

Recent EMEA Uptake of MDM

Ruukki Sartorius Werkzeuge Sberbank Société Générale Sociale Verzekeringsbank Sogei S.p.A. Sonae Saint-Gobain Stallergenes Syngenta Swisscom SwissGrid Talk Talk Telecom Egypt Tesco Bank The Travel Group Travel Port TUI Van Marcke Veolia Viega Visa Europe WIND Telecom

3 Suisses Achmea Accor Al Hilal Bank (UAE) Alstom Argos ASICS Banque Centrale Populaire (MO) Banco Santander BANKART Belgacom Belgium Post Baumarkt Direkt Bluarancio Bouygues Telecom Carrefour Credit Agricole Commune di Roma Compagnia Assicuratrice Dalkia Deutsche Telkom Dubai World DSV

Eli Lilly UK Euroclear EADS Gazprombank Hypo Vereinsbank ING LaSer Cofinoga Lloyds Maersk Mitchells & Butlers Мир Книги Network Rail NFU Mutual Norway Post Orange Otto Group Ouest-France Peter Justesen PPL Prisa Digital RTE Rusatom

Representative Sample


Asia-Pacific Uptake of MDM

Queensland Health (AU) RAC Victoria (AU) RAC WA (AU) Samsung (KR) Samsung Life (KR) Shenzhen Development Bank

(CN) Shanghai GM (CN) Shanghai Regional

Community Bank (CN) Simplot (AU) Suncorp (AU) Sydney Water (AU) Tai Kang Life (CN) Taiping Life (CN) Taiwan Mobile (TW) Telecom NZ (NZ) Telstra (AU) Tongshan District Tax Bureau

(CN) Tower Australia (AU) Tsingtao (CN) Westpac (AU) Woolworths (AU) Zhejiang Tailong Commercial

Bank (CN)

ANZ (AU) Asics (JP) ATO (AU) Alliance Bank Malaysia (MY) Bank Central Asia (ID) Bank Negara Indonesia (ID) Bank of China (CN) Bank of Commerce (CN) Bank Tenaga Negara (MY) Bendigo Bank (AU) BHP Billiton (AU) CBA (AU) Centrelink (AU) China CITIC Bank (CN) China Unicom (CN) Chongqing Changan

Automobile Co. (CN) Daihatsu Motor Co. (JP) Dept of Educ - SA Dept of Educ – WA FANCL (JP) GCG China (mobile) (CN) GE Money (AU) General Dept of Taxation

(VN)

Huawei (CN) HK Trade Development

Council IP Australia (AU) Japanese Research Institute

(JRI) Korea Telecom (KR) Krung Thai Bank (TH) KT&G (KR) Lion Nathan (AU) Macquarie Bank (AU) Ministry of Educ (SG) Ministry of Finance (CN) Ministry of Health (NZ) Ministry of Health (SG) Mitsubishi Motors (AU) Mizuho (JP) MLC (NAB) Mobily (SA) NAB (AU) New Zealand Customs (NZ) NTT (JP) Optus-Singtel (AU) Origin Energy (AU) Perodua Otomobil (ID) Rio Tinto (AU)



Recent North America Uptake of MDM

NY Times Oppenheimer Funds Panera Bread PetSmart Pitney Bowes Polycom PTC Smith & Nephew T-Mobile Teach for America Time-Warner Cable TJ Max Toys R Us Travelport Uti Visa Walt Disney Resorts Whataburger Whole Foods Wyndham

AARP Allied World Assurance Co. (AWAC) Apria AutoTrader.com Biogen Idec BJ's Wholesale Club Blackstone Group BMC Software CarFax Chartis Chevron Costco Covidien Devon Energy Educational Testing Services Essilor Federal Reserve

Board FHA

First American Title Fox Global Hyatt Guy Carpenter Hilton Worldwide Huntington Bank Intact Financial John Wiley & Sons JP Morgan Chase Key Bank Kroger Logitech Maersk MassMutual McKesson Men’s Wearhouse Morgan Stanley Nextel Northern Trust



Overview of REALITY CHECK Survey Process

Pool of 1,300 MDM projects w/w 250 completed surveys 2Q2012

AHIMA, AXA Equitable, Barry Callebaut, Celanese, Cisco, ConAgra, Eli Lilly, Erie Insurance, Farmers Insurance, Freddie Mac, Honeywell, Intact Financial, Khaga, Lender Processing Services, Liberty Mutual, Merck, Munich Re, Nordea Bank, RBC Insurance, Red Hat, Sutter Health, Swiss Re, Timken Co., Toys R Us, Univision, Unum, Walt Disney Co., …

Telephone follow-up to complete surveys Focused on past & current attendees of

MDM Summit


SUMMARY FINDINGS:MDM & Data Governance

1. Compliance, single customer view (SCV), KYC/KYS, etc. are “universal” drivers

2. Large enterprises have moved beyond CDI & PIM to include reference master data

3. Enterprises have stopped calling out multi-domain & now assume MDM includes multiple domains

4. Data Governance is both synergistic & co-dependent with MDM

5. Big data requires both MDM & Data Governance to be effective & sustainable


2012-13 MDM Planning Assumptions

Pervasive MDM

Master data governance

Business process hubs

Universal MDM

Reference data mgmt

Social MDM

Identity resolution

Big data

Business-critical MDM

Budgets/skills

Strategic planning assumptions to assist IT organizations & vendors in coping with flux & churn of emerging MDM vendor landscape


Pervasive MDMStrategic Planning Assumption

During 2012-13, application providers will deploy en masse, the next generation of MDM-innate (as opposed to MDM-aware) applications; concurrently SaaS vendors (CRM, ERP, HRM) will struggle to provide integrated/native MDM

Through 2013, mega vendors Microsoft & Oracle will provide entry-level (low cost) departmental MDM –via MSFT MDS & ORCL DRM respectively

By 2014, SaaS (Cloud native) app vendors will have finessed this issue via strategic partnerships & investments in MDM; by 2014-15, the market for MDM-enabled applications will exceed that for MDM software

MDM MILESTONE

MDM-innate (e.g. Fusion MDM) will overwhelm MDM-enabled applications



MDM Institute Field Reports – MDM**

Aprimo/Teradata MDM

IBM InfoSphere MDM Informatica MDM IBI MD Center Kalido MDM Microsoft MDS Oracle MDM Orchestra Networks

Pitney Bowes Riversand SAP MDM, MDG & MDS SAS DataFlux Software AG Stibo Talend TIBCO MDM

** Persisted customer or product data hubs

W/W MDM Market Share

•IBM (MDM, MDS, MDM4PIM)

•Informatica (Siperian, Identity Systems)

•Oracle (CDH, UCM, PIM, Fusion MDM)


Working Definitions

Data Governance (DG) Data Governance (DG)

Formal orchestration of people, process, & technology to enable an organization to leverage data as an

enterprise asset across different lines-of-business and IT systems

Passive Data Governance Passive Data Governance

Data steward consoles & other reactive data management

capabilities focused on after-the-fact data compliance; often batch-

like & not integrated with MDM

Master Data Governance aligns IT-centric viewpoints & business-centric viewpoints regarding data quality; MDM &

MDG are becoming natural way of aligning data with business processes

Proactive Data GovernanceProactive Data Governance

Metrics-driven, crowd-sourced capability for business users & IT

to actively control their shared data across different lines of

business & IT systems

Active Data GovernanceActive Data Governance

Metrics-enabled, upstream data policy enablement; replaces

manual data admin processes with role-based, real-time SME

empowerment


Master Data GovernanceStrategic Planning Assumption

Through 2012, most enterprises will struggle with enterprise MDG as they initially focus on customer, vendor, or product; integrated MDG that includes E2E data lifecycle will be mandated as 1st phase deliverable

During 2012-13, major SIs & MDM boutiques will focus on productizing MDG frameworks while MDM software providers struggle to link governance process with process hub technologies; concurrently G5000 enterprises struggle to evolve enterprise MDG in cost-effective & practical way from “passive” to “active” MDG modes

By 2014-15, vendor MDM solutions will finally move from “passive-aggressive MDG” mode to “proactive MDG”

MDM MILESTONE© 2012 The MDM Institute www.The-MDM-Institute.com

MDG *must* evolve from point products (i.e., to address customer or product MDG only) to enterprise data

governance (supporting multiple domains such as customer, product, supplier, location, price, etc.)


MDM Institute 2012-13 Field Reports – MDG

ASG BackOffice

Associates Cognizant +

Collibra EMC/RSA/Archer IBM MPDM IBI MD Center Informatica IDD Kalido DGD

Microsoft DG Console Oracle DGF Orchestra Networks SAP MDG SAS DataFlux Software AG Utopia Varonis

Business Process Hubs Strategic Planning Assumption

During 2012, MDM solution providers & BPM solution providers will increasingly collide in market as the former acquire or build out BPM-centric MDM; both camps will be challenged to unify domains as there exist different business processes for CDI & PIM

Through 2012-13, however, BPM-centric MDM will suffer from BPM’s traditional focus on modeling & not executing MDM rules

By 2014-15, all mega MDM & BPM vendors will have overcome this dogmatic bias as enterprise BPM needs to execute within governance & vice versa be able to execute MDM workflows within BPM

MDM MILESTONE

From the enterprise perspective, a complete MDM solution requires Rules & Reference Data to be applied across

domains© 2012 The MDM Institute www.The-MDM-Institute.com

Universal MDMStrategic Planning Assumption

Through 2012, corporate MDM platform evaluation teams will assume (and insist) that all MDM software platforms targeted for enterprise-level deployment or major role in mission-critical systems fully support both PARTY & THING entity types

During 2013-14, large enterprises will also mandate that REFERENCE data be part of the MDM platform's native entity types

By 2015, all operational CDI hub vendors will add "PIM light" capabilities, and all PIM vendors will add B2C PARTY entity

MDM MILESTONE

Most PIM are multi-domain, not just PIM … always include SUPPLIER; CDI always has entitlements


Reference Data ManagementStrategic Planning Assumption

During 2012-13, reference data will emerge as a key

entry point for enterprises & in turn influence choice of MDM for Customer, Product & other domains

Concurrently, every MDM vendor will rush to market RDM solutions to apply MDM approach for centralized governance, stewardship & control

By 2013-14, large enterprises will also mandate that Reference Data be part of MDM platform native entities

By 2015, RDM will be commoditized via the efforts of MSFT & ORCL especially

MDM MILESTONE

Managing “simple” reference data will prove to be a key sales entry point for MDM vendors


MDM Institute 2012-13 Field Reports – RDM

Aprimo LRDM (Teradata MDM)

ASG ROCHADE (Metadata-driven RDM)

IBM RDM iGATE Patni RDMS Informatica RDM

(incl Fin Svcs solution)

Microsoft RDM Oracle Site Hub, DRM Orchestra EBX Profisee SAP MDG-R (Reference

Data) Software AG

WebMethods OneData


Social MDM (Cloud-enablement, Architecture & Integration)

Strategic Planning Assumption

During 2012, cloud-enabled MDM will attract small- & mid-sized businesses as a means to engage in MDM without committing to long-term project & major expense while offering enticing entry point for large enterprises

Through 2013-14, cloud-integrated apps arrive via SFDC, SAP BBD, et al, however, enterprises will wrestle with data integration issues between on-premise & cloud with majority of organizations unwilling to house master data about customers, products & suppliers in public cloud

By 2014-15, cloud-innate services for DQ & MDG will be more prevalent than full Social MDM; however, Enterprise MDM will remain “on premise” with increasing integration to public Cloud applications

MDM MILESTONE

MDM-enabled apps will migrate to public Cloud, especially for decentralized/geographically distributed organizations


Identity ResolutionStrategic Planning Assumption

Through 2012, registry-style MDM solutions will find favor in industries where data is legally or physically too difficult to consolidate into physical hub -- esp. government, US healthcare)

During 2012-13, mega MDM vendors will apply the powerful hierarchy mgmt capabilities of native registry solutions to integrate both legacy MDM hubs & ECM

MDM maintaining the master customer profile data will be key integration point btwn Social CRM & big data analytics

By 2014-15, open source alternatives to monopolistic algorithm vendors will help reduce cost of MDM software procurement

MDM MILESTONE

Mega vendors will adapt matching algorithms of registry MDM hubs to bolster performance & accuracy of their operational/transactional hubs matching throughput


Big Data (& In Memory)Strategic Planning Assumption

During 2012, performance of all major aspects of base MDM functionality will benefit from performance-enhancing capabilities of big memory configurations — from batch loading of MDM hubs to identity resolution to operational updates

Through 2013, big data will repatriate itself into the MDM fabric via registry overlays as yet another source; “master data resolution” is key to filtering signal:noise ratio

By 2014-15, very large enterprises (fin svcs, gov’t) will leveargereal-time MDM flows & scaling of MDM solutions via the elasticity of Cloud-based solutions, in-memory cache databases, i.e., the next-generation of ETL/MDM

MDM MILESTONE

Big data apps need to be MDM-aware; MDM must also be able to store preferences for each big data source; big data

system needs to understand master view of customers & products


Business-Critical MDMStrategic Planning Assumption

During 2012, dogmatic spats regarding analytical vs. operational vs. collaborative MDM use cases will blur as each of these becomes business-critical MDM which in turn demand zero downtime

Through 2012-13, MDM platforms will increasingly provide in-situ capabilities to change the data model, business rules, etc. … without taking the MDM services offline

By 2014-15, this will impact the way master data services are syndicated & delivered … regardless of regular ablutions such as software upgrades

MDM MILESTONE

MDM is about improving business processes – enterprises expect enterprise-strength MDM-powered applications

targeted at their industry or problem set


Budgets/SkillsStrategic Planning Assumption

During 2012, the number of IT professionals trained in a specific MDM solution will increase 200% Y2Y, however, IT orgs & consultancies will struggle to recruit & retain MDM veterans who have actually successfully had a major role in an MDM deployment

Through 2013-14, enterprises will continue to spend to 3X to 4X in “plan” & “build” services vs. software

By 2014-15, supply of MDM-experienced consultants will catch up with demand & SIs will scramble to find new opptys for their expensively recruited & trained talent

MDM MILESTONE

Given substantial investment businesses undertake with SI partners, this area must be given scrutiny – not only to

contain costs, but to insure success of this vital infrastructure investment


MDM & MDG Consultancy Momentum


•ACN – Accenture

•CAP -- Capgemini

•CTSH – Cognizant

•INFY – Infosys

•TCS – Tata Consultancy Services

•WIT – Wipro

MDM & Data Governance Services

Market for MDM & Data Governance services reached US$2.5B during 2012 & will exceed US$4 billion by 2015

Systems integrators are essential to success of majority of MDM projects, yet previously incumbent SIs usually are no longer so

Data Governance assistance from SIs will remain especially critical to success of MDM programs during 2012-15 as organizations deal with a shortage of tools, experience, & tool expertise


This area must be given scrutiny – not only to contain costs, but to insure success of this vital investment

Field Report: Major SIs

Accenture BackOffice Associates Capgemini Cognizant Deloitte EMC Consulting IBM BAO/GBS/

Lab Services Informatica Pro Svcs

Infosys Logica Lumendata Oracle Pro Svcs SAP Pro Svcs Stream Integration Tata Utopia Wipro


Field Report: MDM & DG Specialists Affecto Arhis Attevo Black Watch Data Broadstreet Data Business & Decisions Caritor Consology Datpro Detica Datum eCenta Edificio Entity Group Evaxyx First San Francisco

Partners

GlobalSoft HighPoint Systems Hitachi/Sierra Atlantic InfoTrellis Jibes Myers-Holum Project Performance

Corp. NorthGate Perficient Platon SDM Serene SapientNitro SITA Sogeti Steria© 2012 The MDM Institute www.The-MDM-Institute.com

Field Report: Major SIs with Minor Practices

Atos Avanade BearingPoint CGI-American

Management Systems CSC Dell/Perot Systems Fair Isaac / Braun

Consulting


Action Plan for 2012-13

Promote MDM as essential business strategy with IT deliverables to leverage high-value info used repeatedly across many business processes

Position MDM as enabler of key business activities such as improving customer communication & reporting – rather than an important infrastructure upgrade

Begin MDM projects focused on either customer-centricity or product/service optimization

Plan for multi-entity MDM juggernaut evolving from “early adopter” into “competitive business strategy”

Insist on Enterprise MDM software capable of evolving to multiple usage styles & data domainsPlan now to realize economic value & competitive

differentiation via multi-entity MDM during next 2-5 years© 2012 The MDM Institute www.The-MDM-Institute.com

Bottom Line: MDM & Data Governance

Invest in MDG for long-term sustainability & ROI of MDM

Acknowledge currently marketed MDG does not exist as integrated solution

Plan for most MDM vendors to deliver MDG during next 6-12 months

Recognize mega vendors (IBM, INFA, ORCL, SAP)

focused to deliver MDG capability in 2012 – with resultant partner chaos

Manage SI partner to integration roadmap with MDM platform of choice & to avoid “brain drain”


MDM & Data Governance Summit™Conference Series


“More MDM programs get their successful start at MDM & Data Governance Summits than anywhere else”

MDM & Data Governance Summit New YorkMDM & Data Governance Summit New YorkMarriott Marquis NYC Times Square ▪ October 14-16Marriott Marquis NYC Times Square ▪ October 14-16

MDM & Data Governance Summit SingaporeMDM & Data Governance Summit SingaporeMarina Bay Sands Resort ▪ December 4-5Marina Bay Sands Resort ▪ December 4-5

MDM & Data Governance Summit ShanghaiMDM & Data Governance Summit ShanghaiShanghai International Convention Center ▪ March 2013

MDM & Data Governance Summit Europe MDM & Data Governance Summit Europe Radisson BLU – London ▪ April 15-17, 2013Radisson BLU – London ▪ April 15-17, 2013

MDM & Data Governance Summit Asia-Pacific MDM & Data Governance Summit Asia-Pacific Four Points Darling Harbour– Sydney ▪ May 20-21, 2013 Four Points Darling Harbour– Sydney ▪ May 20-21, 2013

MDM & Data Governance Summit San FranciscoMDM & Data Governance Summit San FranciscoHyatt Embarcadero – San Francisco ▪ May 2013Hyatt Embarcadero – San Francisco ▪ May 2013

MDM & Data Governance Tokyo MDM & Data Governance Tokyo Belle Salle Kanda– Tokyo ▪ June 2013Belle Salle Kanda– Tokyo ▪ June 2013

MDM & Data Governance Summit Canada MDM & Data Governance Summit Canada The Carlu – Toronto ▪ June 2013The Carlu – Toronto ▪ June 2013

Aaron ZornesFounder & Chief Research

OfficerThe MDM Institute

[email protected]

www.linkedin.com/in/aaronzornes @azornes


Authoritative

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