Taming the torrent of data

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 CRM leader.
  • 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 content management.

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 not alone.

"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, Wash.

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," p. 70.]

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.

Looking out

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 communications.

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."

Looking in

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 releases have
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.