Data Fit to Compete

You expect senior executives like DataFlux President and CEO Tony Fisher to be upbeat in prosperous times, but to know Fisher is to understand that his attitude doesn’t change with the business barometer. Since 1986 when he joined SAS to his last seven years heading up DataFlux, Fisher’s upbeat energy and curiosity have been keys to his companies’ success. He recently sat down with DM Review Editorial Director Jim Ericson to relate his current view of data quality, master data and governance.

DMR: As a wholly owned subsidiary of SAS, how does DataFlux bring a “big picture” to the marketplace?
Tony Fisher: We look at DataFlux as a best-of-breed vendor with an established platform of data quality technologies. SAS is best of breed in several areas: analytics, decision support, data warehousing and business intelligence. Data quality technology is fundamental to SAS initiatives, but the two companies are pursuing separate opportunities. There are synergies in the technologies, though to some degree we view them separately. We set it up like this to take advantage of all the opportunities that are out there.

DMR: I’m asking partly because of all the acquisitions in the market and the big platform messages from Oracle, SAP and IBM.
TF: Things are happening in our industry for different reasons. You have SAP buying Business Objects but keeping the brand as an operating unit. You have Oracle rolling in Hyperion and deep-sixing the brand over time. Microsoft’s strategy was also about buying technology, but I read that they might buy 20 companies in 2008 and keep them independently branded. Right now the opportunities are of different types according to business needs. One set of people in the organization looks at operational data, and another group looks at BI. Sometimes they talk to each other and sometimes they don’t, so we take advantage of platforms dedicated to different opportunities. Over time we’ll see more of a migration to a blended BI and analytics strategy. At that time, there will be alternatives and decisions to make about how DataFlux and SAS move forward, but it’s a little premature to talk about that now.

DMR: The data platforms do seem to be maturing though.
TF: Yes, if you are looking at the mature areas of the market. Organizations have begun piecing together processes across different parts of the organization, and that’s driving platform consolidation. It makes sense, but then you see a lot of innovation at smaller companies that’s growing and evolving, and eventually the same will happen to them. They’ll be bought out and integrated into larger platforms. I don’t see that cycle changing too much.

DMR: One current cycle of interest is in master data management (MDM) where DataFlux and many other large vendors are seriously committed. Why is MDM drawing so much interest in the current context of business priorities?
TF: The real relevance is making sure data is fit for the purpose of the organization. We all know about the explosion of data going on. The other thing is that data is now treated as a corporate asset. Any airline knows their airplanes, reservation systems, maintenance schedules, the age of the fleet and how that fits their plans. Most organizations haven’t been treating data like that until recently, and now it’s absolutely huge and getting the appropriate sponsorships and funding in organizations.

DMR: The Fortune 1000 companies I talk to are already sounding much more ambitious about MDM programs versus projects.
TF: Ultimately, MDM is about all the domains in an organization. It’s also true that some domains are more critical to your organization, so different purposes drive an organization to MDM. Is it an aspect of compliance? If it’s Sarbanes-Oxley, financial data is your primary focus. If it’s watch list compliance, customer data is the focus. MDM spans all these domains, and as you plan, you need to think globally about how things ultimately piece together. You cannot realistically do it all at once, so you make sure you plan for all the domains and lines of business and implement them as the business dictates.

DMR: You’ve told me in the past that compliance is the biggest driver of MDM you come across. That surprises me a bit.
TF: It’s one of probably three main areas, but compliance is big. By definition, compliance is looking at different parts of your organization that don’t necessarily communicate, don’t have integrated applications, and you have to rationalize information from across your organization to prove compliance. We’ve seen time and time again that organizations will say they’re in compliance. Auditors come in and say, “Your report indicates you are in compliance; now, prove your report is accurate.” In that case, organizations just throw up their hands because they’ve no cohesion of data and can’t reproduce what they’ve done. The same applies to a second driver we see in customer relations, which is about making sure you know whether your data is in your call center, in your database marketing system or in your financial systems. A third area we see a lot of is what you might call operational efficiency, or making sure your operational systems are operating to the highest capacity they can. We have an $8 billion customer that is rationalizing indirect spend - all the things they buy that don’t actually go into the products they make. It’s the computers and paper and desks, but [to the system] a curved desk or a black desk or a round desk were all different things. They use our technology to rationalize and go to suppliers with category requirements and save a lot of money. In every case, you need data quality and matching technologies along with good data management techniques.

DMR: That also sounds like a segue to governance, which is not really a technology issue.
TF: That’s exactly right. There are technologies that are important in governance, but governance is a business issue, and that is the real shift we have seen over the last year. A few years ago, data quality was done as an afterthought, with IT handling the little tactical chores. Data governance is much broader than that; it’s about the business making sure the data across your organization fits the needs of your business, is consistent and has the same meaning no matter where you are in your business. It requires people who don’t usually talk to each other to decide what a customer is, what the important attributes are and where the best place is to get the attributes. Governance allows you to put business savvy into the data so it does indeed reflect the needs of your business.

DMR: DataFlux is a technology company, not a systems integrator or consulting house. What’s your interest in the governance discussion?
TF: Several years ago when everything was tactical, the biggest problem was convincing an organization that data quality problems were having a negative impact on their operations. You can’t go to an executive, even a CIO, and talk about data quality. They don’t want to hear that. But when you start talking about data governance and the way data impacts things like risk and compliance, corporate governance, operational systems and customer relationships, all of a sudden you can talk to anybody. This idea of data as a corporate asset drives the success of very broad initiatives that have revenue or cost benefits, very tangible things a CEO will listen to.

DMR: Don’t the system integrators provide most of the advice in this case though?
TF: I’d love tell you I can sell you a box of data governance, but I can’t. However, DataFlux is evolving with the market and moving from tactical to strategic data quality implementations. To do that, we must have expertise in house to provide high-level strategic analysis and planning to help clients understand policy changes and personnel changes that will have to take place in order to succeed. Having said that, you are correct to say that a lot of advice, especially in large organizations, is provided by systems integrators. Sometimes it’s the big integrators, and sometimes it’s smaller ones with expertise in a particular area. So yes, they are becoming a critical part of our ecosystem, and we’re making sure they understand what DataFlux provides to the overall picture, including data governance assessments. We have become much more expert in this area because we see it time and time again. One interesting thing I’ve seen lately is a shift across industries toward IT taking a driver’s role in data governance as a part of the business that knows the business. We definitely see a much more business-savvy IT organization, especially in some of the bigger companies. They’re saying, we’re providing these services on behalf of the business, but we haven’t got it quite right or we’re not giving them what they think they’re getting. Seeing IT starting to drive a lot of this data governance activity is a pretty curious shift I really didn’t expect.