Aaron Zornes Expert Testimony Avoiding The Si Money Pit

Avoiding the MDM SI “Money Pit”

Aaron ZornesChief Research Officer

The MDM [email protected] +1 650.743.2278

© 2009 The MDM Institute The-MDM-Institute.com

Managing the SI Relationship

Determining the evaluation criteria for selecting SI partners for MDM projects

Identifying which SIs are market leaders in your industry & your chosen software technologies

Managing the SI relationship – esp. avoiding “brain drain” & inflationary “blended rates”

Preparing for talent shortages now is the savvy way to avoid the MDM "money pit" later


Why Focus on “SI” Cost Component?

MDM projects typically incur substantial amt of systems integration in first 12-24 months as businesses wire data sources into enterprise's data hubMDM Institute research finds G5000 enterprise spends average of US$1.2 million for MDM software solutions - with addt’l investment of 4X in SI servicesMDM is one of few remaining growth areas for both software vendors & systems integrators (SIs)Recent buzz around MDM is rivaled only by intensity with which systems integrators have "found MDM religion"

Given substantial investment businesses undertake with SI partners, this must be scrutinized – not only in effort to

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


MDM Phases

Phase 0 tasksScoping of Phase 1Limited proof-of-concept (POC)Requirements captureROI projectionVendor & product evaluation

Phase 1Limited deployment within single business division or department for single entity, e.g. customer or product

Phase 2Going enterprise-wide with single master entity, e.g. customer, product, supplier, etc.

Phase 2+Going enterprise-wide with more than one master entity, e.g. customer, product, &/or supplier, etc.

Phase 3Extending master data extra-enterprise-wide with more than one master entity, e.g. customer, product, &/or business partners, e.g. strategic sourcing supply chain, outsourced call centers, etc.


Other Post "Phase Zero" Tasks

Perform gap analysis to determine which software must be developed internally & which can be purchasedIdentify a systems integrator (SI) consultancy partnerPlan for IT organizational change managementWork with the business leadership to design & refine "future state" business processes associated with new MDM commitments

After determining/aligning business strategy …


Areas Where SIs May Provide Value

Identify & prioritize business functional requirements Recommend build vs. buyProvide a solution selection methodology that balances business & technical requirements Develop detailed request for proposal (RFP) Evaluate & select the right MDM software solution vendor(s)


Areas Where SI Provides Implementation Value

Pilot the MDM solution & application integrationDevelop IT & business user communications in addition to training materialsDefine & establish user job roles – e.g., MDM project leads, corporate/LOB data stewardsDefine metrics for ROI or other measurements Structure change management & system tuning strategies


“Top 5” Technical Evaluation Criteria for MDM Systems Integrators

#1 – Extensible data governance methodology & accelerators

#2 – Industry-specific data model experience & ETL mappings

#3 – SOA architecture experience & accelerators

#4 – MDM product experience

#5 – MDM project experience (industry, geos, egos))

Partner's capabilities include their depth & available expertise


Understanding Your SI’s Business Model

Significant challenge for SI is to determine mega vendor &/or best-of-breed/vertical niche MDM software vendors with which to alignEach MDM vendor has

Vertical industry – e.g., banking or pharmaceuticalCorporate horizontal functional specialization – e.g., B2B hierarchy rationalization)Mind share & brand recognition by virtue of early successes

Typical SI Team Drawn From Various Other Practice Teams

• Enterprise architecture planning, esp. SOA experts

• Enterprise data modeling

• Legacy app reengineering

• Data conversion & application migration

• Data quality

• EAI middleware & BPM experts.

• Analytics & ETL experts

• Testing & QA

• Systems infrastructure mgmt

• Performance engineering

• ROI & cost-model generation (business value articulation)


Data Governance Will Become Major Investment

Defining master data governance IT processesEstablishing & training the data stewardship functionDesigning future state business processes tied to newly founded MDM commitments regarding customer data


How to Keep Staff from Being Shanghai’ed

Financial handcuffsPersonal/corporate recognitionCareer tracksContractual non-compete/”hands-off my people”


MDM & DG SI Round-Up

1. Accenture2. Adastra3. Adjoined4. Alliance Consulting5. Arhis6. ATG7. Attevo8. Atos Origin9. Avanade10. Back Office Associates11. BearingPoint12. Cambridge Technology Partners (Novell/CTP)13. Camelot – IDPro AG14. Capgemini15. Caritor16. CGI-American Management Systems17. Cignex18. Cognizant19. CSC20. Deloitte Consulting21. Detica22. Diamond Cluster23. EMC BusinessEdge Solutions24. Evaxyx25. Fujitsu (formerly DMR)

26. Harte-Hanks Data Services27. Highpoint Solutions28. Hitachi Consulting29. HP/EDS/Knightsbridge30. IBM Global Business Services31. Infogain32. Infosys33. Logica34. Lockheed Grumman35. Marks Baughan & Co36. Ness Technologies37. Northgate38. Patni39. Perot Systems40. Project Performance Corporation41. SAIC 42. Satyam43. SBS (Siemens Business Services)44. Sierra Atlantic45. Sogeti46. Synergic Partners47. Tata48. Unisys49. VIP Systems50. Wipro


Field Report: Major SIs

Accenture AIMS

Atos Origin

Cognizant

CSC

Deloitte

EMC /BusinessEdge

HP/Knightsbridge /EDS

IBM GBS

Infosys

Oracle Pro Svcs

Tata

Wipro


Field Report: CDI, MDM & DG Specialists

ArhisAttevoBack Office AssociatesCaritorConsologyDiamond Mgmt & Technology Consultants EpsilonHCLHighPoint SystemsLumenData

Project Performance CorporationNorthGatePerficientSierra Atlantic

SogetiTechnologixTechnology Solutions Company Unisys


Field Report: Major SIs with Minor Practices

BearingPoint

Capgemini

CGI-American Management Systems

Fair Isaac / Braun Consulting

Fujitsu (Born, DMR)

Hitachi Consulting

Lockheed Grumman

Mahindra Satyam

Patni

Perot SystemsPwC

SAIC

SBS (Siemens Business Services)


Three Key Business Factors

Status of current incumbent relationships at the executive level

Status of current contracts, and pending contract negotiations (for other projects)

Business size, partnership direction, and ongoing viability of the SI/consultancy

Your organization’s weightings may vary …


Bottom Line: Avoiding the SI Money Pit

SIs are often necessary to sell C-level execsWithout C-level support, BUs will find it difficult to contribute funding & resources necessary to launch an MDM initiative – resulting in status quo with each business unit continuing to address issue at division-level (if at all)


Bottom Line: Avoiding the MDM SI Money Pit

SIs are needed to coordinate IT & BusinessReadiness & maturityPlan for IT organizational change management to support MDM effortsWork with business leadership to design & refine the “future state” business processes associated with new MDM commitments



SIs are needed to help transform IT organizations

To a greater degree than traditional application development initiatives, organizational readiness & acceptance has huge impact on both success & sustainability of MDM initiative



After initial development of a MDM system, SIs can help IT & Bus by facilitating:

Ongoing participation in development of business rules & resolution of master data match/merge issuesOngoing commitment to update both applications & business processes to leverage core data stored in master data hub


Rx for SI Management Strategies

Acknowledge that SIs are essential to success of majority of MDM projects

Recognize that incumbent SIs are no longer so

Identify which SIs are market leaders in your industry & your chosen software technologies

Proactively manage key IT positions

Leverage SIs for their “value add”

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


How to Leverage the MDM Institute

Kick start the “MDM evaluation process”Attend public workshopBring workshop on-site

Fine tune in-process MDM strategiesDue diligence on reference checking & contract details

Stay ahead of curve via MDM Business CouncilRe-qualify every 6 months via surveyReceive MDM Alerts & access to Web-hosted research

Increase your knowledge & negotiatingstrengths via MDM Advisory Council Membership

Participate in monthly email surveys & receive updated industry scorecard Receive unlimited MDM, CDI, & data governance consultation via telephone

“Independent, Authoritative, & Relevant”

Q&A