Organizing for MDM: Defining, Aligning and Managing

Organizing for MDM: Defining, Aligning and Managing Critical Roles

Gartner Master Data Management Summit 2011

February 2-3, 2011Park Plaza Westminster BridgeLondon, UK

Ted FriedmanDebra Logan

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Strategic Imperative: MDM is not just an IT implementation. To achieve a successful MDM initiative, you must align the MDM organization and processes with the realities of the wider

organization, assign data stewardship roles and responsibilities to the correct people, manage stakeholders effectively and proactively manage change.

Organizations that are embarking on an MDM program will have many challenges in the "organizational"Organizations that are embarking on an MDM program will have many challenges in the organizational building block of their MDM initiative. These challenges will include the need to understand how the organization is currently structured and how any MDM organization needs to align with the current and any future state. This will involve decisions regarding what is centralized or localized. It will also be key to assign roles and responsibilities for MDM, particularly getting the right (business) people to accept data stewardship responsibilities. Another part of the people aspect of MDM will be the need to manage stakeholders effectively. This involves building and keeping support, as well as trying to minimize any damage done by potential opponents. Last, there needs to be recognition that MDM usually creates changes in the way people work and that these changes must be proactively managed for MDM to succeed.

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MDM program managers face many challenges that have nothing to do with technology The most significantMDM program managers face many challenges that have nothing to do with technology. The most significant involves harnessing people to set the vision for, and to fund, manage and execute, MDM goals. A matrixedorganization with clear roles and responsibilities will be necessary to build and operationalize the plan. Identifying key resources, both within the MDM program and in new roles outside the program that can influence the direction of MDM, is crucial.

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Key Issue: Why is organization — roles people and their alignment — critical to MDM success?Key Issue: Why is organization — roles, people, and their alignment — critical to MDM success? Although the business is often a primary beneficiary of MDM, it can be hard to get business managers' collective buy-in and to get them to lead from the start of the process. But MDM will fail without business buy-in and leadership. To encourage this, begin with engagement. To identify where the business benefits from an MDM discipline, survey the quality and use of your enterprise's master data. Ask the business telling questions that, for most leaders, become engaging topics:• What master data exists in the business?

I h f d h d i d h i i if ll f d f ?• In what form does the data exist, and how is it, if at all, transformed from system to system?• Where does the master data come from?• What is meant by acceptable master data quality? Which user/application defines this?• How are business terms and data elements commonly defined and used across the enterprise?• How did the data get where it is?• How and why does a data element vary from the accepted common corporate definition (it exists)?Action Items: Identify business applications named users and/or roles and data services that author publish consume

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Action Items: Identify business applications, named users and/or roles, and data services that author, publish, consume or subscribe to master data. Maintain an up-to-date and public record of desired and actual master data quality and service/performance level targets for what is being maintained.


Tactical Guideline: Eighty percent of change initiative failures are the result of ineffective leadership, underestimated magnitudes or an inability to deal with the cultural impacts of the

change. Build ongoing assessments into the change plan to ensure that the MDM initiative stays on track with these critical success factors.

Key Issue: Why is organization — roles people and their alignment — critical to MDM success?Key Issue: Why is organization — roles, people, and their alignment — critical to MDM success?

Imperatives come into play in all three types of change, but they manifest differently across each. The type of change most dependent on a clear and unambiguous imperative is enterprise-level change. The critical success factor (CSF) here is leadership unambiguously proving the imperative and persuading stakeholders the imperative is real. If they fail, those affected will not get on board and the change will fail. For project-level change, the CSF is accurately identifying the impacts of the change on those who are affected — at a very personal level. Failure to do so may result in an affected body that believes the change isn't worth it. They may manifest malicious compliance, outright insubordination or

b i l i i F i di id l l l h f d i d bili d i i hsubstantial passive resistance. For individual-level change focused on enterprise adaptability and innovation, the imperative is embraced by those affected, but the enterprise itself gets in the way. Here, the obstacle is existing, outdatedmanagement systems, hierarchies, practices, reward systems and so on that protect the status quo at the expense of innovation. This is often the result of middle management feeling threatened by an informed, empowered workforce. They see a loss of turf and prestige and are unable to envision where they fit and will simply block changes from percolating up or down.

Action Item: Understand the role and importance of imperative to each type of change and prove, reinforce and manage

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to it as appropriate in your MDM program.


Key Issue: Why is organization — roles people and their alignment — critical to MDM success?Key Issue: Why is organization — roles, people, and their alignment — critical to MDM success?

This case study is for ABB, a large global engineering company that operates in 100 countries and employs more than 100,000 people. ABB operates a group of companies that focuses on power products (such as transformers and switchgear), power systems (turnkey products for power generation and transmission), automation products, process automation and robotics. Its basic organizational principles involve a three-way balance between the corporate center (that is, at the group level), the global businesses and the geographic organization. The MDM organization and governance aligns with that structure. At the group level, the company has a a well-established MDM function (started in 2001) h f f IT I id MDM i h d b h 100 li i f l i l2001) that forms part of group IT. It provides MDM services, that are used by more than 100 applications, for multiple master data domains, including organization, standards, products, customers, vendors, employees, financials and components, across the group. The group-level MDM function sets group MDM standards, develops and manages the group MDM tools, and provides overall supervision of data quality and services. Divisions and business units harmonize requirements from a local bus to provide a global product view. They set demands for sales and engineering support, and local bus and engineering centers manage the local master data, which is linked to the global master data. The country organizations execute and manage data for finance and administration, human resources, customer and vendor data and link to the group level MDM tools

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link to the group-level MDM tools.


Tactical Guideline: Organizations need to ensure that they have cross-functional representation in their MDM program, with appropriate functional data stewardship roles and

responsibilities.

Key Issue: What new roles and organizational structures must be created to maintain an effective andKey Issue: What new roles and organizational structures must be created to maintain an effective and relevant MDM program?

Enterprises differ in how they organize for MDM due to wide variations in scope, complexity, structure, and degree of centralization and localization. However, some basic organizational principles can be described as best practices for greater success. First, it's important to have clear and unwavering executive sponsorship for MDM. You only want one, shared version of the truth across the enterprise, and no one has the power to make this happen except senior business managers. Similarly, information governance is an enterprisewide issue and needs to be tackled by a cross-functional

b d h d f i f i li i R i h b d h ldgovernance board that creates and enforces information management policies. Reporting to the governance board should be the data stewards — business stakeholders responsible for the quality of the data. The MDM team is responsible for program management and ongoing execution of the business processes associated with the master data life cycle. This team is ideally business-led, and includes "master data authors." Depending on the structure of the enterprise, these master data authors may be part of a central team managing the creation and maintenance of master data, or they may be business users in business units, functional areas or geographies. IT has a crucial role to play as an enabler, although it must have representation at the governance board level and in the MDM team. IT's MDM focus should include architecture data modeling integration application development data quality technologies system management security

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architecture, data modeling, integration, application development, data quality technologies, system management, security and reporting.


Decision Framework: The best approach to positioning data stewardship responsibilities depends on the scope, objectives and culture of your organization. Various approaches are

possible, the most common being to align stewards along data subject area or business process lines.

Key Issue: What new roles and organizational structures must be created to maintain anKey Issue: What new roles and organizational structures must be created to maintain an effective and relevant MDM program?Data quality improvement and broader information governance programs often yield limited benefits for a very simple reason — the necessary activities (enforcing policies, monitoring data quality levels, training personnel on the importance of high-quality data management practices and so on) are not made the formal responsibility of specific individuals. There is no focal point or leadership role within the organization where data quality improvement activity is operationalized Emerging best practices for information governancedata quality improvement activity is operationalized. Emerging best practices for information governance include the creation of formal roles, including those of data steward (see "Toolkit Sample Template: Data Steward Role Description" G00153532). The role of data steward can take many forms, and the following examples reflect a range of structures and approaches. However, all successful data stewardship programs have the common themes of clear roles, goals and metrics, and a vision for ongoing improvement and governance. Although data steward roles have traditionally been organized along data domain lines (that is, a steward had responsibility for a specific data subject area or subset thereof), this is not the only approach possible.

i l i i ki i d i i i i d hi ibili i

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Increasingly, organizations are taking a process-oriented perspective in assigning stewardship responsibilities. With this approach, data stewards are responsible for all data types produced by, and/or consumed within, a particular end-to-end business process, or subset thereof.


Tactical Guideline: An effective decision-making environment comprises appropriate processes that strike the right balance between rigor and cost; appropriate structures that

balance oversight and agility; and appropriate communications that deliver the right information at the right time to the right people, without overloading them with irrelevant

facts.acts

Key Issue: What new roles and organizational structures must be created to maintain an effective andKey Issue: What new roles and organizational structures must be created to maintain an effective and relevant MDM program?Having sorted investments into categories, and then created a structured process for ranking investments, it may seem that all the hard work has been done. But that ignores the political nature of all major business decisions. An effective decision-making environment comprises appropriate processes that strike the right balance between rigor and cost; appropriate structures that balance oversight and agility; and appropriate communications that deliver the right information at the right time to the right people, without overloading them with irrelevant facts. A "Goldilocks" or "just i ht" d i i ki t t hi th b l f i ht d ilit Thi t t h j t th i htright" decision-making structure achieves the balance of oversight and agility. This structure has just the right

stakeholders involved in just the right parts of the decision making process at just the right time. Stakeholders can play one of five decision-making roles, depending on the decision at hand. The first two roles are key to reaching a decision. The three final roles are critical to implementing it: 1) Decision-Maker: The person ultimately responsible for the decision, who also has input (input rights) into the decision, 2) Influencer: People with input rights to the decision, 3) Implementers: People who deliver the outcome of the decision, 4) Recipient: People who are directly affected by the decision, 5) Observers: People who are indirectly affected by the decision, but need to be kept informed. These roles are distributed throughout an enterprise's hierarchy The more important a decision the higher up the organization it is made

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distributed throughout an enterprise s hierarchy. The more important a decision, the higher up the organization it is made. The less important, the lower down it can be delegated.

Action Item: Identify all the key stakeholders and their roles.


Key Issue: What new roles and organizational structures must be created to maintain anKey Issue: What new roles and organizational structures must be created to maintain an effective and relevant MDM program?This major healthcare products supplier had operations around the world, but most of its business is in the U.S. It has grown through M&A — leading to multiple brands and silos — which has created effectiveness and efficiency challenges. Management have a "one company" vision, and MDM plays a key role in achieving that vision. The organization plans to tackle several domains, including customer, vendor and product. Initially, the focus was on customer and vendorfocus was on customer and vendor.

The MDM program is enabled by a central IT capability and a central shared-services business transformation office (BTO) that manages the governance framework. Business functions are responsible for data stewardship and have created a accountability and responsibility matrix that clearly shows who is responsible and accountable, who is consulted and who is informed, not just relative to the different data domains, but also relative to the views on each domain.

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Strategic Imperative: Organizations must not only evaluate the landscape of their data quality issues, but also assess their culture. The general mind-set regarding the importance of data

quality and proper behaviors with respect to data are key factors for success.

Key Issue: How can MDM program managers successfully manage MDM stakeholders andKey Issue: How can MDM program managers successfully manage MDM stakeholders and ongoing change? Most organizations view data as a technology-oriented problem. They rely on the IT organization to ensure the security, availability and quality of data, treating data as a "necessary evil," rather than as an important corporate asset. Data quality is a business issue in terms of its impact and the optimal approaches for addressing it. The business, not IT, needs to define what is "good enough" quality. Most organizations require a significant degree of cultural change to reach the point where data quality is treated as a business issue andsignificant degree of cultural change to reach the point where data quality is treated as a business issue and data quality improvement efforts are driven and supported by the business. At the same time, the business needs to realize that optimal improvements to data quality cannot be achieved with technology alone. A combination of people-related improvements — for example, organization and training — and process improvements will be required to deliver the maximum benefit and ensure long-term maintenance of acceptable data quality levels. As large organizations become aware of the impact of data quality, many will attempt to move from an IT focus on this issue to a business focus. Organizations that make this transition

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successfully will reap rewards in terms of increased productivity, accuracy and consistency of information.


Key Issue: How can MDM program managers successfully manage MDM stakeholders andKey Issue: How can MDM program managers successfully manage MDM stakeholders and ongoing change?Achieving success in an MDM program involves far more than choosing and implementing a suitable technology solution. Some of biggest non-technical issues are in the governance and organization area, and success in managing MDM stakeholders can have a major impact on the progress and success of the MDM program. There may be many stakeholders in different parts of the organization, but they should not be considered equal and must be managed in different ways Use this step-by-step methodology to identify MDMconsidered equal and must be managed in different ways. Use this step by step methodology to identify MDM stakeholders, segment them based on their "pull" and "stance," and choose the appropriate tactics and techniques for managing them.

MDM stakeholders come largely from the business, although there may be IT stakeholders and external business partners, external agencies and sometimes regulators to manage. Depending on the focus and scope of your MDM program and your industry, MDM stakeholders will comprise the heads of different functional areas (such as sales, service, marketing, procurement, logistics, finance and IT), product lines or geographies.

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( , , g, p , g , ), p g g pIdeally, senior sponsorship should come from a leader among this group or from the level of management above them.


Tactical Guideline: Not all MDM stakeholders are equal, so it doesn't make sense to manage them all equally. Differentiate MDM stakeholders by their "pull." This has three attributes —

power (clout), urgency (deadline restrictions) and legitimacy (right to make a claim).

Key Issue: How can MDM program managers successfully manage MDM stakeholders and ongoingKey Issue: How can MDM program managers successfully manage MDM stakeholders and ongoing change?

The second step in managing any MDM stakeholders is to cluster them into meaningful groups. Not all stakeholders are equal, so it doesn't make sense to manage all equally. There are many types of stakeholders — some more demanding than others. The more demanding they are, the more potential they have to be troublesome if incorrectly managed. But demand is not necessarily the best determinant of priority, even though demanding stakeholders would like you to think so. Differentiate MDM stakeholders by pull. This has three attributes — power (clout), urgency (deadline restrictions)

d l i i ( i h k l i ) Thi k f h P U d L (PUL) D i h ll f h k h ld iand legitimacy (right to make a claim). Think of them as P, U and L (PUL). Determine the pull of each stakeholder using all three attributes. Stakeholder stance is the amount of support or opposition a stakeholder has toward an issue. The task of discovering the stance of a person or group might seem daunting at first. But talking directly to the stakeholders or to people who have previously dealt with them can ferret out their current position and underlying reasoning. Mapping stakeholders by pull and stance segments stakeholders into four groups. Influential opponents, influential supporters, weak supporters and weak opponents. Based on these categories, you can devise your management strategies to address each appropriately. The endgame is to turn as many stakeholders as possible into influential supporters. Use a combination of five management tactics to do so: recruit restrict retain recognize and review

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combination of five management tactics to do so: recruit, restrict, retain, recognize and review.


Tactical Guideline: It's best to turn as many MDM stakeholders as possible into supporters, and to prioritize how to reach this goal. Recruit your persuadable opponents to the cause.

Restrict your influential opponents. Retain your influential supporters. Recognize your weak supporters. Review your weak opponents. Combine management techniques to manage your

MDM stakeholders and achieve your goals.sta e o de s a d ac e e you goa s

Key Issue: How can MDM program managers successfully manage MDM stakeholders andKey Issue: How can MDM program managers successfully manage MDM stakeholders and ongoing change? The four types of MDM stakeholders are not equal. Even if they were, there's no way to deal with them all at once. To turn as many stakeholders as possible into supporters, it's best to prioritize how to reach this goal. Priority 1: Recruit persuadable opponents to the cause. Priority 2: Restrict influential opponents. Priority 3: Retain influential supporters. Priority 4: Recognize weak supporters. Priority 5: Review weak opponents. Use a combination of management techniques to manage your MDM stakeholders:• Senior management intervention: Replaces stance and pull of stakeholder with that of senior management.

The result is replacement of a large number of stakeholders with a small influential group.• Governance: Removes some stakeholders from some decisions (reducing pull). Replaces stance and pull of

the individual stakeholder with that arrived at by due process.• Steering committee/other committees: Replaces stance and pull of an individual stakeholder with that of the

committee. The impact is similar to senior management but with greater transparency.R l i hi A di l dif f k h ld di "b k f d ill "

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• Relationships: Acts directly to modify stance of stakeholder, trading on "bank of good will." • Negotiation: Attempts to modify stakeholder stance through mutually beneficial trade-offs.• Engagement: Begins dialogue and refines understanding of stance and pull.


Decision Framework: MDM drives change from three perspectives: 1) collective company, 2) project participants and 3) affected individuals. Each drives slightly different affects and

behaviors, which dictate the magnitude of social resistance to the MDM project. Knowledge of these change perspectives should drive change strategy and shape project plans.

Key Issue: How can MDM program managers successfully manage MDM stakeholders andKey Issue: How can MDM program managers successfully manage MDM stakeholders and ongoing change?Each change perspective brings certain behavioral response patterns that drive the underlying change techniques employed. Enterprise-level change perspectives and behaviors are influenced by the past success of similar initiatives, competing priorities, the relationship among leaders and workers, and general organizational energy or exhaustion. The emphasis is in ensuring an appropriate, prioritized, manageable, well-communicated change initiative portfolio. Project-level change is focused on a single change with a defined g p j g g gbeginning, middle and end. It's about execution. The emphasis is in: 1) ensuring that those affected believe the project will push through the danger zone, 2) managing project activities and affects to ensure that it does, 3) adequately preparing the affected to adapt and 4) recognizing the phases that those affected will go through at each stage of the project. Individual-level change is about operationalizing the implemented change and ensuring permanency of "the new way of doing business." This is a long-term context requiring acknowledgement of the rates at which individuals adapt to change and hiring people who are inherently adaptive and share the goals values and mission behind the change initiative

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adaptive and share the goals, values and mission behind the change initiative.Action Items: Be clear about the change context and the resulting, underlying behavior patterns that will need to be managed. Incorporate all three into your MDM change program.


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Documents

Organizing for MDM: Defining, Aligning and Managing