Taming the torrent of data
- By Jack Vaughan
- May 31, 2001
What point of view does data have? For application developers, data has usually
been a means to an end ...
It has been at the service of whatever application a developer is building.
In the '80s, with databases proliferating and silo applications rampant, a hardy
few began to try to bring a single view to data. Failures probably outnumbered
successes. In any case, data was (and still is) gaining dominion.
The single, consistent data view may be more in reach today -- but at a cost.
And data may be gaining a point of view -- it is becoming more customer-centric
thanks to a slew of corporate customer relationship management (CRM) solutions.
In fact, CRM is replacing data warehousing as the big buzzword for members
of the packaged application and data-centric development community, much as
Enterprise Application Integration (EAI) displaced middleware as the hot term
among custom application developers. Industry expert Julie Hahnke is among those
that see CRM ascending. She pegs CRM as one of the hottest drivers of new systems
initiatives in Fortune 500 companies. You can tap into her insights by reading
"Putting the customer back in CRM."
But what is meant by "customer" may vary. If it is a rental car customer clicking
away on a transactional Web site, it is the conventional customer as described
in Marketing 101. There is another broad customer type. If it is a line-of-business
manager eager to study sales results in the Pacific Rim, it is the in-house
"customer" as has come to be described by centralized corporate IT departments
over the years.
A growing number of operations data rationalization initiatives -- designed
to meet the needs of in-house managers -- are variously named as balanced scorecarding
or enterprise performance management (EPM) solutions. Industry expert Colin
White likes to use the term "decision processing" to describe what he sees as
a new breed of closed-loop decision-making environments streamlined for optimal
effectiveness. We present Colin's view in "Decision processing:
The next generation of business intelligence."
Just as there are several ways to define a customer, there are a number of
angles from which to approach CRM and EPM solutions. Various analysts have quite
different takes on the issues. Like many things today, the job is largely integration
work. But not all solutions take integration as the starting point.
- Companies [and analysts, for that matter] that have significant investments
in analytical or business intelligence (BI) tools may look to their present
vendors for CRM and decision processing enhancements.
- Companies that have invested successfully in corporate data warehouses are
likely to build their CRM or EPM solution using the warehouse tools suites.
- Meanwhile, companies coming off the heels of major investments in back-office
ERP apps (from SAP, Oracle, Baan, PeopleSoft and the like) or front-office
sales call-center software solutions (from Remedy, Vantive and the like) will
try to build on these infrastructure elements. The vendors here may be one
step ahead. For example, human resource back-office specialist PeopleSoft
recently announced a merger with front-office help-desk and sales marketing
software house Vantive. The goal was to create a CRM powerhouse. Increasingly,
sales force automation leader Siebel Systems has come to be portrayed as a
- Another approach to CRM starts from a wholly new perspective. Web personalization
software vendors offer Web-oriented tools that use the new medium to profile
customers and serve up customized presentations.
The fact is that the closer you look at CRM (and perhaps EPM, as well) the
more it seems to disappear. The more elements one wishes to combine (from ERP
to BI to the Web and beyond), the more the task may resemble EAI. As well, say
development managers, the more elements connected, the higher the cost of implementation
-- and the higher the risk of failure. Industry hands old enough to remember
leisure suits know that the goal of the single, coherent view of the customer
has been an IT goal for a long time.
The Webification of CRM
An example of the emerging breed of Web-based CRM takes the form of a new
app at Home Depot. The hardware giant made a point to establish some fundamental
application infrastructure before layering over software from BroadVision Inc.
when building a personalized Web site for customers. "Ultimately, we will be
invoking other services from within the company to work with this system," said
Mike Anderson, the firm's vice president of information services. "We looked
at products focused on building a customer relationship -- products that allow
you to tailor each customer's experience based on a profile."
The controlling flow of the site had to be based on customer profiles, not,
for example, on order forms, Anderson explained. To accomplish this, Home Depot
deployed the BroadVision One-To-One Command Center for personalization and rules-based
marketing programs, and the BroadVision One-To-One Publishing Center for distributed
Relative start-ups like BroadVision and SilkNet [see "Building what they want,"
this page] view the Web as a chance to leapfrog established vendors. They are
"Where data warehousing, CRM and the Web come together is where the point
of pain is today," said Brian Burnett, CEO at Aberdeen, Scotland-based AppsCo
Software Ltd. Burnett's company recently opened U.S. offices to bring its brand
of rapid analytical data mart development stateside. Not surprisingly, as AppsCo's
AppSmart software is SQL Server-centric, the new offices are located in Bellevue,
The Web/CRM confluence-point is the object of attention of Web app server
specialist Art Technology Group (ATG), now of Cambridge, Mass. On the heels
of its recent IPO, ATG is targeting what it calls the Internet Customer Relationship
Management (ICRM) market. ATG, which was early to personalize Web-borne catalog
info based on viewers' preferences, has a unique take on ICRM -- among its objectives
is the goal to help e-businesses to more effectively manage their online relationships
in a global manner. Thus, a Web site serves up info tailored to the home country
of the viewer. XML and Java help make this happen.
Frederick W. Rook, senior vice president of product development for ChannelPoint,
a firm created to meet the business-to-business needs of the online insurance
marketplace, said ATG's new Dynamo 4.5's XML-based content repository simplifies
data interface formats and implementation changes between sources. [For another
slant on CRM, and insurance and data integration see "AXA road leads to Roma,"
Forrester Group Analyst J. Thomas Gormley III forecasts that the advent of
more dynamic trade will obsolete conventional CRM apps. Webified or otherwise,
Forrester estimates that the single integrated view of the customer is a big
driver today. Of 50 executives interviewed at 25 large companies, Forrester
found only 22% to admit that a single integrated view of the customer was unlikely
to be obtained within two years.
A key to success in CRM implementation is understanding customer delivery
channels, according to Cassandra Millhouse, lead CRM analyst for research firm
Ovum. Different vendors are likely to serve different channels more effectively,
said Millhouse. Products tend to betray their origins: IBM's are call center-oriented,
Siebel's are best developed for field sales operations, she said by way of example.
Millhouse said the big issue in CRM implementation may be organizational.
"Everyone says they're customer focused, but is the company really ready to
turn around and deal with business issues across divisions?" she asked.
Because so many elements must be connected in enterprise CRM apps, super-offerings
may come to prominence as CRM point-solution vendors consolidate, said Millhouse.
"You buy ERP because you don't want to integrate a lot of systems," she explained.
"In the same way, it makes sense to buy all the things of CRM out of the box."
Consolidation is clearly on the horizon, concludes Jim Dickie, managing partner,
Insight Technology Group, Boulder, Colo. And, although people start from different
points with CRM, "eventually, they all have to get to the same place," said
Dickie. "Generally, people are letting the business issues dictate the course
they take. People trying to find new customers are spending money on Internet
initiatives. Other people focus on getting sales reps up to speed. The trouble
for application development groups is in deciding how tightly coupled you want
these apps to be," he said.
Part of customer relationship may mean closing the doors on some customers.
If a firm is a proven credit risk, said Dickie, systems should be alert so that
a lot of marketing money is not spent to sell to that company. This data might
have been easier for managers to share in the days before computers, he noted.
Then, managers were all located at headquarters and could walk down the hall
to find out these things. Today, fully 50% of the companies Insight Technology
Group talks to are remote or virtual corporations, meaning systems must provide
The idea of the out-of-box CRM solution is overstated, said Dickie. "None
of these systems work out of the box. If you are really lucky, you might get
80% [of your eventual app] out of the box."
While some firms look out toward the customer, some look at how in-house processes
can be improved. Enterprise performance management, key performance indicators
(KPI) and balanced scorecarding are names for this. Of course, it is not a fair
summary to describe the EPM scorecard as inward looking. Measures of customer
satisfaction are intrinsic to real corporate performance monitoring [see "Get
your balanced scorecard here!," ADT, January 1999, p. 71]. This year, new EPM
arrived from Gentia, Broadbase, Cognos, Brio and a host of others. One of the
biggest developments has been the corporate information portal, which takes
a cue from Web technology familiar through the popular Yahoo! Web search site.
The big move to watch in EPM these days, said Phil Russom, an analyst at Framingham,
Mass.-based Hurwitz Group, is the move from enterprise performance measuring
to enterprise performance management.
Is there overlap between EPM and CRM? Yes. For example, when launching its
recent Essbase OLAP Server 6, Hyperion pegged it for new classes of applications,
such as e-business analytics, customer relationship management and enterprise
performance management. The same base capability is needed in both spheres of
the data-driven firmament.
To maneuver in this shifting world, it is necessary to synthesize a variety
of data sources. Among the many parts of the decision processing infrastructure
described by DataBase Associates International's Colin White is the federated
data warehouse that brings order to diverse data marts. That is the goal of
recent software efforts from Brian Burnett's AppsCo and Michael Stonebreaker's
Cohera, as well as others.
The erudite crew at DataBase Associates likes to quote Elizabethan era philosopher
Francis Bacon on data. "Knowledge is power," Bacon wrote in Meditationes Sacrœ.
De Hœresibus. This has held true from the days of Francis Drake's piratical
raids to the present era of e-trades. Sorting through the options for sorting
through the data is a big job. For some of the swift ones, however, the rewards
may repay the effort.