Sign up now and get the best business technology insights direct to your inbox.Loraine Lawson spoke with Karen Leightell, senior product manager for IBM Master Data Management Solution Group at IBM.
Lawson: How does this product help with data integration across the enterprise?
Leightell: I’ll give you a bit of background on the space. Traditionally, companies have had their master data spread out across their organization in silos. They may have key facts about their data in backend systems, frontend systems, and in many legacy systems, and typically there was no way for an organization to be able to get its master data in one place. The master data is critical to a lot of different business processes and when we talk about master data, we typically talk about customer data, product data and account data. So, however an organization defines its customer, it’s critical for them to be able to manage their customer data centrally and be able to make that information available to the wide range of systems that require it.
The reason these types of solutions are becoming so important is because these companies never really had a way to manage this data so it was truly up to date and accurate. They might have this data in a CRM system, but that CRM system doesn’t talk to other systems and it isn’t designed to handle the changes that are required to master data and the functions to propagate those changes out to a lot of other systems that might need it. So what happened is, companies didn’t have a system that allowed them to focus on managing the master data. That was how the master data management solutions space evolved.
What you’ll see in the market is a lot of these solutions providers come out of specialization around customer data integration and product information management. And the umbrella banner for those is master data management.
IBM made acquisitions of two companies a few years ago and those companies specialized in CDI (customer data integration) and product information management. And they were, as their own companies, leaders in those two categories. So IBM acquired those companies, the product information management product in 2004 and the CDI product in 2005. They have been rebranded under the WebSphere brand and they’re now offered as a Master Data Management offering. The names of those products are WebSphere Customer Center – that’s the CDI functionality – and WebSphere Product Center – that’s the product information management functionality. They are two separate solutions. They tend to handle very different, discrete functionality for product and customer information, so they are separate. However, IBM does have a strategy at this time for an MDM offering — it’s called Multi-form MDM, which will address the consolidation of that functionality. The first release of that product will be announced at the end of this year.
Lawson: What do you get when you marry those two?
Leightell: What companies are really showing a need for is both types of those functionalities to be deployed within their organization and hence an MDM solution, where product and customer functionality get addressed in one solution. Basically, our roadmap and our strategy are to deliver that type of functionality. The strategy that we’re moving toward is called multi-form MDM. That strategy is the notion of being able to apply different usage styles to the way you define, create and propagate data out to different systems.
Yes, eventually those functionalities will be married. Today, they exist and can be offered in separate offerings. The new release – we’ll be making that announcement in October and we’ll provide a lot more color around what that release will consist of—will address the operational MDM functionality.
Lawson: Is your product built with SOA? How does it do in that environment?
Leightell: We are based on SOA. It’s a highly desirable type of architecture to have in place to leverage our technology. The reason for that is that the whole concept of what we are putting forth, in terms of data management, is structured on what we call business services. Whether it be a piece of data on its own or a composite of data tied to business rules –these are provided to other systems as a service.
Our data is offered as a service to any consuming application that wants it. So if the billing application is asking for data or a set of data, it will look to the set of master data to provide that. If you’re adding a new customer into an organization’s system, for example, the transaction that you would be calling up from the MDM system would be called “add new customer.” It would be called upon as a service and the MDM system would deliver that business service to the appropriate system. That might be first, last name, address, e-mail, telephone, etc. And it offers it up as a packaged service of all required data. Some systems may only call on a piece of that. Some systems may call on more than one service. But the solution is fundamentally designed as a service-based system to those applications that need to call on that data. And the reason the company would apply that kind of design principle - having one central Master Data Management system to service up all of this critical data - is that the organization can be assured that each and every system is getting the same data, (thereby) ensuring consistency across the organization. In the meantime, the MDM solution is chugging along making sure that the data within the system is clean, accurate, and up to date. It’s processing any possible duplicate suspects – like duplicates within a system – it’s maintaining the integrity of the master data so that all the other systems can be assured they’re getting the right data, instead of some old legacy piece of data sitting in a system that hasn’t been updated in months or years.
Lawson: How is it serving the data? In XML?
Leightell: There are lots of different formats that can be supported with these solutions including XML, SOAP, JMS, using through real-time adapters.
Lawson: Who else was in the leaders quadrant? What are your main competitors and how are you different?
Leightell: Oracle was also in the leaders box this year for the first time. IBM differentiates itself quite a lot. The CDI solution that IBM now offers is WCC. It was part of an acquisition and the company that they acquired was DWL. The heritage of DWL was really focused on, by design, creating a solution that would address this problem and this problem only. There are a number of other vendors that come from an ERP or CRM background that tried to offer customers a solution that would address this issue. There was a fundamental design flaw in the way a CRM solution was designed as opposed to a MDM solution. CRM is primarily designed for marketing-related or sales activities, which means it has a whole set of application functionality that requires a database to run on. The database is populated with data. It’s fine to run the Seibel CRM call center and marketing applications. Those kinds of databases suffice to do that job, but the same underlying architecture and design principles are being applied to CDI solutions.
Where they fail is in the underlying design principle, in that those databases do not have the functionality embedded within to manage the maintenance and quality and integrity of the customer data itself. Whereas CDI solutions and MDM solutions, as they’re now referred to, were designed specifically to address that problem – the accuracy, relevancy of the master data —and had no other functions other than that – and they were essentially marketed as completely agnostic to the front- and backend systems. They are able to integrate into any kind of CRM or ERP system, which was fundamentally different from the way the CRM companies were positioning their CDI solution. So, in order to get the best-of-breed solution for MDM, it has to be built for that purpose from the ground up – not be a CRM tool or a data warehousing tool repurposed. It needs to be built to manage master data. That would be the key difference.
As we move into several generations of the product, there are other really critical elements around MDM solutions that come back to design principles. For instance, SOA. From the beginning, the solution that IBM sells was designed to be SOA-based. That has a huge effect on the product’s ability to scale and to perform. When you start dealing with operational MDM, you’re dealing with, by and large, a transactional system. And the system has to be ready to manage a high volume of records and large transaction volumes, quickly and, again, if it’s not designed to do so, it’s going to fail on you. CRM systems, by contrast, are not designed for high-transaction volumes. You have to buy the right solution for the right problem.
Lawson: So, what’s the market for Master Data Management? Large enterprises?
Leightell: We used to say it was very much large enterprises that had typically a lot of lines of business or products. Perhaps companies that have gone through a lot of mergers and acquisitions, and companies that tend to have a lot of legacy systems and backend systems that were severely disadvantaged by the problem of not having their data easily accessible and centralized. And it used to be more focused on a B-to-C type of organization. That’s still the case – high volume, transactional volume, B-to-C.
But interestingly, there’s also a huge need – and this has really surfaced since we’ve experienced an increase in regulatory and privacy issues – in the B-to-B environment. Organizations are having difficulty getting a global view of their customer. Organizations are really struggling to know “whom am I doing business with.” What was a real accelerant to getting an MDM solution put in was the regulatory requirements. On a dime, these organizations were not able to produce that information quickly. In the B-to-B, it might be a manufacturer that has a lot of organizations it deals with or a financial services company that deals with companies on the consumer side. It could be that a company needs to get a global view of their distributors.
This whole area is called hierarchical management. It’s an important part of MDM. Companies are seeing value on the regulatory front and the sales front – with a global view of your top sales accounts at the B-to-B level, if you can create that one view, you’ve got a much better chance of being able to provide customers a complete offering across your product lines. You don’t run into the problem of having different divisions selling to the same strategic customer. And, interestingly, that does save a company a lot of money, but it also creates revenue opportunity. The B-to-B market is steadily becoming a very key purchaser of MDM solutions.
The whole notion of being able to integrate into those ERP and CRM systems is key because those are the systems on the front end of master data. It has to work side by side and integrate with those systems. By definition, MDM becomes the system of record. I should also say that master data is not all of an organization’s data. What these companies are doing is looking at a subset - the most critical data - and they may gradually add more types of data. But typically, they may start with seven to 15 types of data that they’ve designated as key and critical and then solution projects carry on and you tend to see more types of data domains being added. What master data management does not want to become is another huge data mart. That is not the idea. Again, they’re transactionally based so they cannot act like a data mart or become another silo of information.
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