“ Milestones on the MDM Road Map for 2008-2009” MDM SUMMIT Fall 2008 Keynote Aaron Zornes Chief Research Officer The MDM Institute [email_address] +1 650.743.2278

Agenda Key findings from MDM Institute’s research “ Enterprise MDM: Market Review & Forecast for 2008-12 ” Why multi-entity MDM? Why now? What are the necessary features of a fourth-generation hub? What is the market outlook for these hubs?

Key findings from MDM Institute’s research “ Enterprise MDM: Market Review & Forecast for 2008-12 ”

Why multi-entity MDM? Why now?

What are the necessary features of a fourth-generation hub?

What is the market outlook for these hubs?

Enterprise Master Data Management: Market Review & Forecast for 2008-12 MDM Institute MarketPulse™ report available October 2008 Executive summary Overview of enterprise MDM Strategic planning assumptions for Global 5000 & SMBs Enterprise MDM market forecast for 2008-12 Leading MDM vendor profiles & field reports Gartner “ MDM for customer master will hit ~ $1B in S/W revenue by 2012” “ With PIM & other domains, it could be over $2B” Forrester “ $344M total MDM S/W market size (not including services) in 2006” “ MDM anticipated growth to over $2.2B by 2010” MDM Institute “ Overall MDM market (customer & product hubs, plus systems implementation services) to grow to $2 billion by 2012” Clearly, enterprise MDM is a major IT initiative being undertaken by large number of market-leading Global 5000 size enterprises

MDM Institute MarketPulse™ report available October 2008

Executive summary

Overview of enterprise MDM

Strategic planning assumptions for Global 5000 & SMBs

Enterprise MDM market forecast for 2008-12

Leading MDM vendor profiles & field reports

Gartner

“ MDM for customer master will hit ~ $1B in S/W revenue by 2012”

“ With PIM & other domains, it could be over $2B”

Forrester

“ $344M total MDM S/W market size (not including services) in 2006”

“ MDM anticipated growth to over $2.2B by 2010”

MDM Institute

“ Overall MDM market (customer & product hubs, plus systems implementation services) to grow to $2 billion by 2012”

The aggregate enterprise MDM market (customer & product hubs, plus systems implementation services) totaled US$730 million at YE2007 & will reach US$2 billion by the end of 2012. Software sales are but one portion as MDM systems integration services reached US$510 million alone during 2007 & are projected to exceed US$1.3 billion per year by 2012. Aggregate MDM Software Market 2008-2012 (total $)

The aggregate enterprise MDM market (customer & product hubs, plus systems implementation services) totaled US$730 million at YE2007 & will reach US$2 billion by the end of 2012.

Software sales are but one portion as MDM systems integration services reached US$510 million alone during 2007 & are projected to exceed US$1.3 billion per year by 2012.

Enterprise MDM Market Price Points 2008-12 Market for enterprise MDM solutions continues to evolve (& will shortly include hosted MDM as well), largest market will consist of those deals with s/w licenses ranging between US$1-2M. Even large # of SMBs which will take up Microsoft MDM & similar lower priced solutions, sheer number of global 5000 sized firms (yet to crystallize their enterprise MDM strategy) will provide steady pipeline of s/w licenses each in excess of US$1M during 2008-12. $0 $50,000,000 $100,000,000 $150,000,000 $200,000,000 $250,000,000 2008 2009 2010 2011 2012 $2M+ $1-2M $250K-$1M $100-$250K <$100K

Market for enterprise MDM solutions continues to evolve (& will shortly include hosted MDM as well), largest market will consist of those deals with s/w licenses ranging between US$1-2M.

Even large # of SMBs which will take up Microsoft MDM & similar lower priced solutions, sheer number of global 5000 sized firms (yet to crystallize their enterprise MDM strategy) will provide steady pipeline of s/w licenses each in excess of US$1M during 2008-12.

Geographic Growth of MDM Market 2008-12 Multiple factors as to why MDM went global so fast. One of main catalysts was IBM’s acquisition of best-of-breed vendor DWL & in turn quick paced ramp up of IBM’s global services organization as well as its global sales & marketing teams. Additionally reduction in price points experienced during 2006-07 plus currency fluctuations enabled second & third world countries’ large enterprises to take up this technology initiative. Additionally, markets within China, India, and the Middle East have yet to be truly explored. Americas, $103,800,000 Americas, $127,050,000 Americas, $165,137,500 Americas, $155,000,000 Europe, Mid-East, Africa, $51,900,000 Europe, Mid-East, Africa, $80,850,000 Europe, Mid-East, Africa, $105,087,500 Europe, Mid-East, Africa, $98,000,000 Asia-Pacific, $17,300,000 Asia-Pacific, $23,100,000 Americas, $359,400,000 Europe, Mid-East, Africa, $119,800,000 Asia-Pacific, $30,025,000 Asia-Pacific, $35,000,000 Asia-Pacific, $119,800,000 $0 $50,000,000 $100,000,000 $150,000,000 $200,000,000 $250,000,000 $300,000,000 $350,000,000 $400,000,000 2008 2009 2010 2011 2012

Multiple factors as to why MDM went global so fast. One of main catalysts was IBM’s acquisition of best-of-breed vendor DWL & in turn quick paced ramp up of IBM’s global services organization as well as its global sales & marketing teams.

Additionally reduction in price points experienced during 2006-07 plus currency fluctuations enabled second & third world countries’ large enterprises to take up this technology initiative. Additionally, markets within China, India, and the Middle East have yet to be truly explored.

Enterprise Master Data Management: Market Review & Forecast for 2008-12 Compliance & regulatory reporting Economies of scale for M&A Synergies for cross-sell & up-sell Legacy system integration & augmentation “Once & done” economies & customer satisfaction Enterprise MDM is increasingly mandated to manage master data (customers, accounts, products, etc.) that has significant impact on enterprises’ most important business processes “ Top Five” Business Drivers for MDM Initiatives

Compliance & regulatory reporting

Economies of scale for M&A

Synergies for cross-sell & up-sell

Legacy system integration & augmentation

“Once & done” economies & customer satisfaction

Enterprise Master Data Management: Market Review & Forecast for 2008-12 Rapid growth of MDM market into mid-market as well as across industries & geographies Steady evolution away from data-centric hubs into application hubs Elemental movement towards “enterprise MDM” in multiple phases Futile dogmatic resistance is fading against the power of multiples Inexorable shift to formal data governance structures The market for MDM solutions is significantly & quickly expanding – across geographies, industries, & price points “ Top Five” Report Findings

Rapid growth of MDM market into mid-market as well as across industries & geographies

Steady evolution away from data-centric hubs into application hubs

Elemental movement towards “enterprise MDM” in multiple phases

Futile dogmatic resistance is fading against the power of multiples

Inexorable shift to formal data governance structures

Solidified Requirements for 3 rd Generation MDM Solutions SOA/shared services architecture with evolution to “process hubs” Sophisticated hierarchy management High-performance identity management Data governance-ready framework Persisted, registry & hybrid architecture flexibility MDM has morphed from “early adopter IT project” to “Global 5000 business strategy”; phase 2 MDM deployments are already fusing party & product domains MASTER DATA SEARCH MASTER DATA MODELING MASTER DATA APPLICATIONS MDM MASTER DATA PREPAR-ATION MASTER DATA GOVERNANCE MASTER DATA MOVEMENT

SOA/shared services architecture with evolution to “process hubs”

Sophisticated hierarchy management

High-performance identity management

Data governance-ready framework

Persisted, registry & hybrid architecture flexibility

Evolving Requirements for 4 th Generation MDM Solutions Multi-entity MDM Process/policy hub architecture Unstructured information support Integrated data governance Enterprise search G5000 enterprises’ business strategies mandate long term, strategic “multi-entity MDM” – in turn enabled by policy-driven data governance MASTER DATA SEARCH MASTER DATA MODELING MASTER DATA APPLICATIONS MDM MASTER DATA PREPAR-ATION MASTER DATA GOVERNANCE MASTER DATA MOVEMENT

Multi-entity MDM

Process/policy hub architecture

Unstructured information support

Integrated data governance

Enterprise search

Business Value of Multi-Entity MDM With a 4 th generation MDM platform, an enterprise will be better able to Identify & provide differentiated service to its most valuable customers via their relationships (households, hierarchies); also cross-sell & up-sell additional products to these customers Introduce new products & product bundles more quickly across more channels to reduce the cost of New Product Introduction (NPI) Provide improved enterprise-wide transparency across customers, distributors, suppliers, and products to better support regulatory compliance processes Enterprises must plan now to realize economic value & competitive differentiation via multi-entity MDM during next 2-5 years

With a 4 th generation MDM platform, an enterprise will be better able to

Identify & provide differentiated service to its most valuable customers via their relationships (households, hierarchies); also cross-sell & up-sell additional products to these customers

Introduce new products & product bundles more quickly across more channels to reduce the cost of New Product Introduction (NPI)

Provide improved enterprise-wide transparency across customers, distributors, suppliers, and products to better support regulatory compliance processes

MDM Milestones www.tcdii.com/mdmresearch/assumptions.html Market maturation Market momentum Market consolidation Budgets/skills Data governance MDM convergence Architecture & data models Identity resolution Party data quality Analytics Policy hubs Enterprise search Strategic planning assumptions to assist IT organizations & vendors in coping with flux & churn of evolving MDM vendor landscape

Market maturation

Market momentum

Market consolidation

Budgets/skills

Data governance

MDM convergence

Architecture & data models

Identity resolution

Party data quality

Analytics

Policy hubs

Enterprise search

Market Maturation Strategic Planning Assumption During 2008, the MDM market will continue to shift gears from “early adopter” to “mainstream” as 95%+ of financial services, communications services, high tech, & pharma/life sciences enterprises actively explore to replace homegrown MDM solutions Through 2009-10, verticalization/horizontalization of MDM solutions will expand beyond corporate financial reporting, EMPI healthcare, etc. into financial services & government especially By 2012, the market for enterprise MDM solutions (software & services) as both strategic initiatives & to refresh aging legacy MDM capabilities will exceed US$3B MDM MILESTONE

During 2008, the MDM market will continue to shift gears from “early adopter” to “mainstream” as 95%+ of financial services, communications services, high tech, & pharma/life sciences enterprises actively explore to replace homegrown MDM solutions

Through 2009-10, verticalization/horizontalization of MDM solutions will expand beyond corporate financial reporting, EMPI healthcare, etc. into financial services & government especially

By 2012, the market for enterprise MDM solutions (software & services) as both strategic initiatives & to refresh aging legacy MDM capabilities will exceed US$3B

Market Momentum Strategic Planning Assumption During 2008, MDM solutions such as IBM, ORCL, SAP, & TDC will monopolize majority market share in the G5000 enterprise; while mid-market solutions arrive from MSFT, Nimaya, & ORCL plus Data Quality vendors (Pitney Bowes/G1, SAS/DataFlux, Trillium) Through 2009-10, both mega & best-of-breed MDM vendors will aggrandize the traditional master customer DB business of Data Service Providers (e.g., ACXM, DNB, & Experian) as these vendors sprint to deliver on-premise CDI hub solutions By 2012, every major application & database vendor will provide either native or OEMed MDM capability – including DOX, MSFT, & CRM MDM MILESTONE

During 2008, MDM solutions such as IBM, ORCL, SAP, & TDC will monopolize majority market share in the G5000 enterprise; while mid-market solutions arrive from MSFT, Nimaya, & ORCL plus Data Quality vendors (Pitney Bowes/G1, SAS/DataFlux, Trillium)

Through 2009-10, both mega & best-of-breed MDM vendors will aggrandize the traditional master customer DB business of Data Service Providers (e.g., ACXM, DNB, & Experian) as these vendors sprint to deliver on-premise CDI hub solutions

By 2012, every major application & database vendor will provide either native or OEMed MDM capability – including DOX, MSFT, & CRM

Market Consolidation & Diversification Strategic Planning Assumption During 2008, mega IT vendors (IBM, ORCL, SAP) will continue M&A-driven R&D gyrations in moving to an enterprise MDM-centric portfolio with ORCL & SAP challenged additionally in moving from silo’ed application architectures into SOA-based architectures (Fusion & NetWeaver) By 2009-10, IBM (ASCL/CRSW/DMC/DWL/LAS/Princeton Softech/ SRD/Trigo/Unicorn) & ORCL (HYSL/iFlex/JDE/PSFT/RETK/SEBL/ Sunposis) will begin to overcome most architectural/ BPM/ metadata/platform issues that confounded SAP earlier (A2i/BOBJ/Callixa) Through 2009-10, mega IT vendors (IBM, ORCL, SAP, & TDC) will dominate the MDM market with niche/best-of-breed vendors (DNB/Purisma, i2, Initiate Systems, Kalido, Siperian) thriving in specific industries & horizontal/corporate applications MDM MILESTONE

During 2008, mega IT vendors (IBM, ORCL, SAP) will continue M&A-driven R&D gyrations in moving to an enterprise MDM-centric portfolio with ORCL & SAP challenged additionally in moving from silo’ed application architectures into SOA-based architectures (Fusion & NetWeaver)

By 2009-10, IBM (ASCL/CRSW/DMC/DWL/LAS/Princeton Softech/ SRD/Trigo/Unicorn) & ORCL (HYSL/iFlex/JDE/PSFT/RETK/SEBL/ Sunposis) will begin to overcome most architectural/ BPM/ metadata/platform issues that confounded SAP earlier (A2i/BOBJ/Callixa)

Through 2009-10, mega IT vendors (IBM, ORCL, SAP, & TDC) will dominate the MDM market with niche/best-of-breed vendors (DNB/Purisma, i2, Initiate Systems, Kalido, Siperian) thriving in specific industries & horizontal/corporate applications

Budgets & Skills Strategic Planning Assumption During 2008, G5000 size enterprises will spend US$1M for MDM software, with add’l US$3-4M for SI services; Global Service Providers will operate under this price floor by applying highly-customized, labor intensive frameworks & related accelerators Throughout 2009-10, skill shortages will greatly inflame project costs as demand for data stewards, enterprise data architects, & individuals with data governance experience outstrip market supply; concurrently, SIs will fill void in classic style by baiting & switching veterans for rookies By 2012, market will stabilize as enterprises react by training & protecting their own MDM staff with specific product & project expertise; until then, enterprises will struggle with re-skilling same resources multiple times as emerging/evolving data management technologies mature (e.g., Fusion, Netweaver, …) MDM MILESTONE

During 2008, G5000 size enterprises will spend US$1M for MDM software, with add’l US$3-4M for SI services; Global Service Providers will operate under this price floor by applying highly-customized, labor intensive frameworks & related accelerators

Throughout 2009-10, skill shortages will greatly inflame project costs as demand for data stewards, enterprise data architects, & individuals with data governance experience outstrip market supply; concurrently, SIs will fill void in classic style by baiting & switching veterans for rookies

By 2012, market will stabilize as enterprises react by training & protecting their own MDM staff with specific product & project expertise; until then, enterprises will struggle with re-skilling same resources multiple times as emerging/evolving data management technologies mature (e.g., Fusion, Netweaver, …)

Career Tracks Strategic Planning Assumption Scarcity of “hands on” MDM experience exists During 2007-08, 1,500+ product-specific consultants albeit with little “real world” experience with mainstay MDM solutions were trained up Current shortage lends itself to same scenario 5-10 years ago with SAP’s ABAP 4GL – i.e., inflated prices & resumes with many junior SI staff spinning up to speed at client’s expense (a.k.a. “Androids”) Market for expertise will create major demand for corporate MDM positions during next 3-5 years Data Steward , Enterprise Data Architect , Enterprise Data Modeler, Ctrs of Excellence, MDM Programmers Product-Neutral Product-Specific Off-Shore On-Site

Scarcity of “hands on” MDM experience exists

During 2007-08, 1,500+ product-specific consultants albeit with little “real world” experience with mainstay MDM solutions were trained up

Current shortage lends itself to same scenario 5-10 years ago with SAP’s ABAP 4GL – i.e., inflated prices & resumes with many junior SI staff spinning up to speed at client’s expense (a.k.a. “Androids”)

Data Governance Strategic Planning Assumption During 2008, most enterprises will struggle with cross-enterprise data governance scope as they initially focus on customer, vendor, & product; enterprise-level data governance that includes entire master data lifecycle (creation, promotion, archiving, …) will be mandated as a core deliverable of large-scale MDM projects Through 2009-10, major SIs & MDM boutiques will focus on productizing data governance frameworks while MDM software providers struggle to link governance process with process hub technologies & enterprises struggle to realize enterprise data governance in cost-effective way By 2011-12, both corporate & LOB data stewards will be a common position as Global 5000 enterprises formalize this function amidst increasing de facto & de jeure recognition of information as a corporate asset MDM MILESTONE

During 2008, most enterprises will struggle with cross-enterprise data governance scope as they initially focus on customer, vendor, & product; enterprise-level data governance that includes entire master data lifecycle (creation, promotion, archiving, …) will be mandated as a core deliverable of large-scale MDM projects

Through 2009-10, major SIs & MDM boutiques will focus on productizing data governance frameworks while MDM software providers struggle to link governance process with process hub technologies & enterprises struggle to realize enterprise data governance in cost-effective way

By 2011-12, both corporate & LOB data stewards will be a common position as Global 5000 enterprises formalize this function amidst increasing de facto & de jeure recognition of information as a corporate asset

MDM Convergence Strategic Planning Assumption During 2008, party & product data interdependencies will quickly broaden MDM requirements – i.e., from “customer” to “product” to “vendor”; concurrently, vendor dogma will promote nouveau approaches such as collaborative MDM to assuage multi-entity conundrum Through 2009-10, select best-of-breed vendors (DNB/Purisma, Kalido, Initiate Systems, Siperian) will provide multi-hub (entity, architecture & brand) connectivity via hierarchy management extensions By 2012, enterprises without an overall, long-term MDM strategy run the ironic risk of building “MDM silos” MDM MILESTONE

During 2008, party & product data interdependencies will quickly broaden MDM requirements – i.e., from “customer” to “product” to “vendor”; concurrently, vendor dogma will promote nouveau approaches such as collaborative MDM to assuage multi-entity conundrum

Through 2009-10, select best-of-breed vendors (DNB/Purisma, Kalido, Initiate Systems, Siperian) will provide multi-hub (entity, architecture & brand) connectivity via hierarchy management extensions

By 2012, enterprises without an overall, long-term MDM strategy run the ironic risk of building “MDM silos”

PARTY:PRODUCT Conundrum Different master entity types may require different MDM brands or architectures Product data shared across supply chain Employee data captive within HR apps Customer data never leaves home (outside the firewalls) Customer policy/ process hubs ultimately require pricing masters, product masters, supplier masters, & so on … SOA mandates “Party” + “Product” MDM – however, “customer” cannot simply be added as object to PIM products Pricing Authorized Products Bundles Cross-Reference Hierarchies Geographical Variants Regional Variants PARTY PRODUCT

Different master entity types may require different MDM brands or architectures

Product data shared across supply chain

Employee data captive within HR apps

Customer data never leaves home (outside the firewalls)

Customer policy/ process hubs ultimately require pricing masters, product masters, supplier masters, & so on …

Architecture & Data Models Strategic Planning Assumption During 2008, vendors will expose MDM capabilities as “always on” services in loosely-coupled architectures; enterprises will begin establishing a central, business-side led data mgmt team with embedded data quality & external data update services in flow of core business processes During 2009-10, mega vendors (IBM, ORCL, SAP, TDC) will focus significant resources on “industry content” of data models which will force specialist vendors to stay “data model lite” via specialization in B2B/B2B2C hierarchy management & distributed MDM Not until 2011-12, will mega MDM vendors rewire foundational software to fully support strategic application infrastructure (Fusion, NetWeaver, …) & have completed transitioning from client/server to SOA; concurrently, G5000 business requirements will drive vendors into 4th gen full spectrum hubs that support structured & unstructured info MDM MILESTONE

During 2008, vendors will expose MDM capabilities as “always on” services in loosely-coupled architectures; enterprises will begin establishing a central, business-side led data mgmt team with embedded data quality & external data update services in flow of core business processes

During 2009-10, mega vendors (IBM, ORCL, SAP, TDC) will focus significant resources on “industry content” of data models which will force specialist vendors to stay “data model lite” via specialization in B2B/B2B2C hierarchy management & distributed MDM

Not until 2011-12, will mega MDM vendors rewire foundational software to fully support strategic application infrastructure (Fusion, NetWeaver, …) & have completed transitioning from client/server to SOA; concurrently, G5000 business requirements will drive vendors into 4th gen full spectrum hubs that support structured & unstructured info

Most Common MDM Topologies Composite/Hybrid is majority architectural preference; Registry/Virtual 2 nd choice Encapsulate legacy applications “ Chernobyl” Ability to fine-tune performance & availability by altering amount of master data persisted XML, web services, service-oriented architecture (SOA) Composite (Hybrid) Metadata layer + distributed query (enterprise information integration or EII) Enterprise application integration (EAI) Portal Registry (Virtual) Master customer information file/database Operational data store/active data warehouse Relational DBMS + Extract-Transform-Load (ETL) + Data Quality (DQ) Persistent (Database) Database marketing providers Data service providers Service bureaus External (Service Provider) DESCRIPTION IMPLEMENTATION STYLE

Encapsulate legacy applications

Ability to fine-tune performance & availability by altering amount of master data persisted

XML, web services, service-oriented architecture (SOA)

Metadata layer + distributed query (enterprise information integration or EII)

Enterprise application integration (EAI)

Portal

Master customer information file/database

Operational data store/active data warehouse

Relational DBMS + Extract-Transform-Load (ETL) + Data Quality (DQ)

Database marketing providers

Data service providers

Service bureaus

Identity Resolution Strategic Planning Assumption During 2008, independent DQ vendors (AddressDoctor, G1, HI, Trillium) will focus on name & address cleansing as they struggle against better funded match/merge & data profiling capabilities increasingly integrated with mega vendor MDM; ongoing challenge will be aggregation of customer data balanced against privacy dictates During 2008-09, MDM capabilities for classifying, discovering & archiving party relationships while maintaining privacy will become major requirement; concurrently, users will be challenged to discern price/performance/scalability & accuracy of matching algorithms By 2009-10, use of cross platform/cross brand customer keys will become core to enabling seamless loyalty programs & online services; sophisticated MDM hierarchy management capabilities will include “global IDs” as mainstay feature to link both legacy & newly-built hubs with DSP’s enrichment data MDM MILESTONE

During 2008, independent DQ vendors (AddressDoctor, G1, HI, Trillium) will focus on name & address cleansing as they struggle against better funded match/merge & data profiling capabilities increasingly integrated with mega vendor MDM; ongoing challenge will be aggregation of customer data balanced against privacy dictates

During 2008-09, MDM capabilities for classifying, discovering & archiving party relationships while maintaining privacy will become major requirement; concurrently, users will be challenged to discern price/performance/scalability & accuracy of matching algorithms

By 2009-10, use of cross platform/cross brand customer keys will become core to enabling seamless loyalty programs & online services; sophisticated MDM hierarchy management capabilities will include “global IDs” as mainstay feature to link both legacy & newly-built hubs with DSP’s enrichment data

Party Data Quality Strategic Planning Assumption During 2008-09, enterprises will focus more on degree to which “party data quality” (consumer, subscriber, owner, member, vendor, establishment, contact, …) is sufficient to meet requirements of diffuse business entities By 2009, ”quality” metrics will increasingly be defined specific to purpose of particular business function (product development, mktg, sales, order admin, service, compliance, analytics, …) & in turn be driven by enterprise-wide data governance initiatives Through 2010-11, wide deployment of loosely-coupled SOA architectures will catalyze consumption of highly-optimized data quality functions as made available via both mega DSP & enterprise application vendors MDM MILESTONE

During 2008-09, enterprises will focus more on degree to which “party data quality” (consumer, subscriber, owner, member, vendor, establishment, contact, …) is sufficient to meet requirements of diffuse business entities

By 2009, ”quality” metrics will increasingly be defined specific to purpose of particular business function (product development, mktg, sales, order admin, service, compliance, analytics, …) & in turn be driven by enterprise-wide data governance initiatives

Through 2010-11, wide deployment of loosely-coupled SOA architectures will catalyze consumption of highly-optimized data quality functions as made available via both mega DSP & enterprise application vendors

Policy Hubs Strategic Planning Assumption During 2008, MDM vendors will lag their BPM counterparts in providing workflow orchestration to synchronize the trusted sources that comprise a federated master data store Through 2009-10, the mega CDI-MDM vendors (IBM, ORCL, SAP) will struggle to provide BPEL-compatible workflows while specialist MDM solutions rush distributed Collaborative MDM capabilities to market By 2012, without such flexible workflows, organizations will merely rebuild the same master data files they evolved the past 15-20 years with their ERP & CRM infrastructures MDM MILESTONE

During 2008, MDM vendors will lag their BPM counterparts in providing workflow orchestration to synchronize the trusted sources that comprise a federated master data store

Through 2009-10, the mega CDI-MDM vendors (IBM, ORCL, SAP) will struggle to provide BPEL-compatible workflows while specialist MDM solutions rush distributed Collaborative MDM capabilities to market

By 2012, without such flexible workflows, organizations will merely rebuild the same master data files they evolved the past 15-20 years with their ERP & CRM infrastructures

Enterprise Search Strategic Planning Assumption Through 2008, the unique properties & behavior of master reference data will spawn a series of vertical applications & specialized features within MDM solutions During 2009-10, semantically-enabled metadata will enable “search” for both structured & unstructured info across a variety of applications such as catalog management & deep web search, & enterprise search By 2012, enterprise semantics & SOA-enabled data services will provide the technology foundation for policy hubs; concurrently, the 4th generation of hubs will innately support Analytical, Operational, & Collaborative & MDM business services MDM MILESTONE

Through 2008, the unique properties & behavior of master reference data will spawn a series of vertical applications & specialized features within MDM solutions

During 2009-10, semantically-enabled metadata will enable “search” for both structured & unstructured info across a variety of applications such as catalog management & deep web search, & enterprise search

By 2012, enterprise semantics & SOA-enabled data services will provide the technology foundation for policy hubs; concurrently, the 4th generation of hubs will innately support Analytical, Operational, & Collaborative & MDM business services

Solidifying Requirements for 3 rd Generation MDM Solutions SOA/shared services architecture evolving to “process hubs” Sophisticated hierarchy management High availability identity management Data governance-ready framework Registry, persisted, & hybrid architecture flexibility Future direction is to also grow all reference masters into operational masters, e.g., pricing & location style masters into transactional support roles via operational, analytical, & collaborative MDM linkages MASTER DATA SEARCH MASTER DATA MODELING MASTER DATA APPLICATIONS 3G MDM MASTER DATA PREPAR-ATION MASTER DATA GOVERNANCE MASTER DATA MOVEMENT

SOA/shared services architecture evolving to “process hubs”

Sophisticated hierarchy management

High availability identity management

Data governance-ready framework

Registry, persisted, & hybrid architecture flexibility

What are the Necessary Features of 4 th Generation MDM Solutions? Multi-entity MDM Multiple “use case” styles Process/policy hub architecture Integrated data governance Enterprise search & support for unstructured info Enterprises must plan now to realize economic value & competitive differentiation via multi-entity MDM during next 2-5 years Identify & provide differentiated service to most valuable customers 4G MDM Introduce new products & product bundles more quickly across more channels Provide improved enterprise-wide transparency

Multi-entity MDM

Multiple “use case” styles

Process/policy hub architecture

Integrated data governance

Enterprise search & support for unstructured info

Bottom Line Planning Assumptions Acknowledge no single vendor does it all “well” Party vs. product B2B vs. B2C vs. B2B2C Batch vs. real-time Recognize that industry expertise matters Test drive matching & consulting expertise Invest in data governance & MDM architecture for long-term sustainability & ROI MDM is critical to proactively & consistently manage customer data to untangle quagmire of complex systems – e.g., streamline processes, enhance QoS, & govern compliance

Acknowledge no single vendor does it all “well”

Party vs. product

B2B vs. B2C vs. B2B2C

Batch vs. real-time

Recognize that industry expertise matters

Test drive matching & consulting expertise

Invest in data governance & MDM architecture for long-term sustainability & ROI

MDM Convergence Strategic Planning Assumption During 2008, party & product data interdependencies will quickly broaden MDM requirements – i.e., from “customer” to “product” to “vendor”; concurrently, vendor dogma will promote nouveau approaches such as collaborative MDM to assuage multi-entity conundrum Through 2009-10, G5000 enterprises will broaden their MDM business initiatives from single use case, single entity to multi-style, multi-entity By 2012, enterprises without long-term multi-entity MDM strategy run ironic risk of building “MDM silos” SOA-based multi-entity MDM manages master data domains (customers, accounts, products, etc.) with significant impact on most important business processes

During 2008, party & product data interdependencies will quickly broaden MDM requirements – i.e., from “customer” to “product” to “vendor”; concurrently, vendor dogma will promote nouveau approaches such as collaborative MDM to assuage multi-entity conundrum

Through 2009-10, G5000 enterprises will broaden their MDM business initiatives from single use case, single entity to multi-style, multi-entity

By 2012, enterprises without long-term multi-entity MDM strategy run ironic risk of building “MDM silos”

PARTY:PRODUCT Conundrum Different master entity types & usage styles may require different MDM brands or architectures Product data shared across supply chain Employee data captive within HR apps Customer data never leaves home (outside the firewalls) Customer data hubs ultimately require pricing masters, product masters, supplier masters, … MDM is increasingly about “multiples” – data domains, relationships among them, & usage styles Pricing Authorized Products Bundles Cross-Reference Hierarchies Geographical Variants Regional Variants PARTY PRODUCT

Different master entity types & usage styles may require different MDM brands or architectures

Product data shared across supply chain

Employee data captive within HR apps

Customer data never leaves home (outside the firewalls)

Customer data hubs ultimately require pricing masters, product masters, supplier masters, …

Why “Multi-Entity MDM”? Why Now? Future direction is to grow all reference masters into operational masters Future MDM landscape Multiple data domains Multiple relationships Multiple usage styles – analytical, operational & collaborative Linkage between operational data domains using collaborative or analytical MDM Enterprise MDM = multi-entity MDM – such epiphany enables the enterprise to avoid “random acts of MDM” Pricing Policy Hub Pricing Reference Master CDI Hub Location Master Customer Registry PIM Data Hub Evolutionary Multi-Entity MDM Entity-Specific MDM Data Marts Myopic Strategic

Future direction is to grow all reference masters into operational masters

Future MDM landscape

Multiple data domains

Multiple relationships

Multiple usage styles – analytical, operational & collaborative

Linkage between operational data domains using collaborative or analytical MDM

Market Update for Product Master Data Adoption of MDM for product is increasingly widespread across all industries Like party master data, product master data spans multiple use cases & implementation styles Diverse range of vendors is targeting the PIM market – enterprise application suite vendors, best-of-breed PIM vendors, best-of-breed procurement vendors, industry-specific product masters, analytical MDM vendors, … even CDI hub vendors No vendor dominates Enterprise application suite vendors will redouble R&D & marketing efforts during 2009-10 Broader & deeper PIM requirements are pushing vendors to develop more comprehensive solutions; the PIM hub market will continue to grow quickly & attract new entrants

Adoption of MDM for product is increasingly widespread across all industries

Like party master data, product master data spans multiple use cases & implementation styles

Diverse range of vendors is targeting the PIM market – enterprise application suite vendors, best-of-breed PIM vendors, best-of-breed procurement vendors, industry-specific product masters, analytical MDM vendors, … even CDI hub vendors

No vendor dominates

Enterprise application suite vendors will redouble R&D & marketing efforts during 2009-10

Findings The value of “enterprise MDM” can be intuitively recognized in a range of business initiatives – from short-term fixes to a narrow set of problems such as capturing customer privacy preferences across product lines to long-term enterprise-wide initiatives delivering infrastructure agility by embracing SOA. MDM Institute Advisory Council Consensus July 2008 internal round table Even tactical MDM projects require facets of the “enterprise MDM” solution set; enterprises must plan now to realize economic value & competitive differentiation via 4th generation MDM during next 2-5 years

The value of “enterprise MDM” can be intuitively recognized in a range of business initiatives – from short-term fixes to a narrow set of problems such as capturing customer privacy preferences across product lines to long-term enterprise-wide initiatives delivering infrastructure agility by embracing SOA.

Summary Enterprise MDM is major IT initiative underway at large # of market-leading Global 5000 enterprises Most enterprises & solutions vendors are finding near-term success with single-faceted approach inherent with 3 rd generation MDM solutions Myopically focusing solely on single data domain & usage style is detrimental to longer term business strategy of integrating supply, demand, & info chains across both intra- & extra-enterprise boundaries Coming to market during 2008-09 are 4 th generation multi-entity MDM solutions which address requirement for multiple domains & styles as well as roles of consumers Learn from MDM early adopters & prepare now for “Enterprise MDM” to increase business value & lower costs

Enterprise MDM is major IT initiative underway at large # of market-leading Global 5000 enterprises

Most enterprises & solutions vendors are finding near-term success with single-faceted approach inherent with 3 rd generation MDM solutions

Myopically focusing solely on single data domain & usage style is detrimental to longer term business strategy of integrating supply, demand, & info chains across both intra- & extra-enterprise boundaries

Coming to market during 2008-09 are 4 th generation multi-entity MDM solutions which address requirement for multiple domains & styles as well as roles of consumers

Bottom Line Promote MDM as essential business strategy with IT deliverables to leverage high-value info used repeatedly across many business processes Position MDM as enabler of key business activities such as improving customer communication & reporting – rather than an important infrastructure upgrade Begin MDM projects focused on either customer-centricity or product/service optimization Plan for multi-entity MDM juggernaut evolving from “early adopter” & into “competitive business strategy” Insist on Enterprise MDM software capable of evolving to multiple usage styles & data domains Plan now to realize economic value & competitive differentiation via multi-entity MDM during next 2-5 years

Promote MDM as essential business strategy with IT deliverables to leverage high-value info used repeatedly across many business processes

Position MDM as enabler of key business activities such as improving customer communication & reporting – rather than an important infrastructure upgrade

Begin MDM projects focused on either customer-centricity or product/service optimization

Plan for multi-entity MDM juggernaut evolving from “early adopter” & into “competitive business strategy”

Insist on Enterprise MDM software capable of evolving to multiple usage styles & data domains

MDM SUMMIT™ Conference Series MDM SUMMIT Canada 2008 Toronto Holiday Inn on King Street | February 4 – 5, 2008 MDM SUMMIT – Spring 2008 Hilton San Francisco | March 30 – April 1, 2008 MDM SUMMIT - Europe 2008 London Royal Garden Hotel | April 21 – 23, 2008 MDM SUMMIT Asia-Pacific 2008 Sydney Sofitel Wentworth Hotel | April 28 – 30, 2008 MDM SUMMIT - Fall 2008 New York Hilton | October 19 – 21, 2008 MDM SUMMIT Iberia 2008 Madrid Mirrasierra Resort | November 4 – 5, 2008 MDM & Data Governance Deutschland 2008 Frankfurt Steigenberger Hotel | October 6 – 7, 2008 MDM SUMMIT - Europe 2009 London Royal Garden Hotel | April 20 – 22, 2008 MDM SUMMIT Asia-Pacific 2009 Sydney Sofitel Wentworth Hotel | April 28 – 30, 2009

MDM SUMMIT Canada 2008 Toronto Holiday Inn on King Street | February 4 – 5, 2008

MDM SUMMIT – Spring 2008 Hilton San Francisco | March 30 – April 1, 2008

MDM SUMMIT - Europe 2008 London Royal Garden Hotel | April 21 – 23, 2008

MDM SUMMIT Asia-Pacific 2008 Sydney Sofitel Wentworth Hotel | April 28 – 30, 2008

MDM SUMMIT - Fall 2008 New York Hilton | October 19 – 21, 2008

MDM SUMMIT Iberia 2008 Madrid Mirrasierra Resort | November 4 – 5, 2008

MDM & Data Governance Deutschland 2008 Frankfurt Steigenberger Hotel | October 6 – 7, 2008

MDM SUMMIT - Europe 2009 London Royal Garden Hotel | April 20 – 22, 2008

MDM SUMMIT Asia-Pacific 2009 Sydney Sofitel Wentworth Hotel | April 28 – 30, 2009

Authoritative Relevant Independent Aaron Zornes Founder & Chief Research Officer The MDM Institute The-MDM-Institute.com a.k.a. www.tcdii.com

About the MDM Institute Founded in 2004 to focus on MDM business drivers & technology challenges MDM Advisory Council™ of fifty Global 5000 IT organizations with unlimited advice to key individuals, e.g. CTOs, CIOs, data architects MDM Business Council™ website access & email support to 8,500+ members MDM Road Map & Milestones™ annual strategic planning assumptions MDM Alert™ bi-weekly newsletter MDM Market Pulse™ monthly surveys MDM Fast Track™ one-day public & onsite workshop rotating quarterly through major North American, European, & Asia-Pacific metro areas MDM SUMMIT™ annual conferences in NYC, San Francisco, London, Frankfurt, Sydney, Madrid “ Independent, Authoritative, & Relevant” About Aaron Zornes Most quoted industry analyst authority on topics of MDM & CDI Founder & Chief Research Officer of the MDM Institute Conference chairman for DM Review’s MDM SUMMIT conference series Founded & ran META Group’s largest research practice for 14 years M.S. in Management Information Systems from University of Arizona

Founded in 2004 to focus on MDM business drivers & technology challenges

MDM Advisory Council™ of fifty Global 5000 IT organizations with unlimited advice to key individuals, e.g. CTOs, CIOs, data architects

MDM Business Council™ website access & email support to 8,500+ members

MDM Road Map & Milestones™ annual strategic planning assumptions

MDM Alert™ bi-weekly newsletter

MDM Market Pulse™ monthly surveys

MDM Fast Track™ one-day public & onsite workshop rotating quarterly through major North American, European, & Asia-Pacific metro areas

MDM SUMMIT™ annual conferences in NYC, San Francisco, London, Frankfurt, Sydney, Madrid

About Aaron Zornes

Most quoted industry analyst authority on topics of MDM & CDI

Founder & Chief Research Officer of the MDM Institute

Conference chairman for DM Review’s MDM SUMMIT conference series

Founded & ran META Group’s largest research practice for 14 years

M.S. in Management Information Systems from University of Arizona

MDM Institute Advisory Council Advisor agrees to provide Institute’s consultants with advice & insight regarding the use of MDM software & related business processes at Advisor’s convenience Advisor agrees to participate in at least one fifteen (15) minute survey teleconference call every sixty (60) days Optionally, Advisor may respond to the bi-monthly survey request via email or Internet-based survey fulfillment Results of such MDM market research surveys shall be aggregated by the Institute & made available to all Advisory Council members In no case, shall any Advisor-specific survey information be made available to other parties unless Advisor has specifically agreed to the release of such information in writing Fifty organizations who receive unlimited MDM advice to key individuals, e.g. CTOs, CIOs, & MDM project leads Representative Members 3M Bell Canada Caterpillar Cisco Systems Citizens Communications COUNTRY Financials Educational Testing Services GE Healthcare Honeywell Information Handling Services Intuit MCI McKesson Medtronic Microsoft Motorola National Australia Bank Nationwide Insurance Norwegian Cruise Lines Novartis Roche Labs Rogers Communications Scholastic SunTrust Sutter Health Westpac Weyerhaeuser

Advisor agrees to provide Institute’s consultants with advice & insight regarding the use of MDM software & related business processes at Advisor’s convenience

Advisor agrees to participate in at least one fifteen (15) minute survey teleconference call every sixty (60) days

Optionally, Advisor may respond to the bi-monthly survey request via email or Internet-based survey fulfillment

Results of such MDM market research surveys shall be aggregated by the Institute & made available to all Advisory Council members

In no case, shall any Advisor-specific survey information be made available to other parties unless Advisor has specifically agreed to the release of such information in writing

3M

Bell Canada

Caterpillar

Cisco Systems

Citizens Communications

COUNTRY Financials

Educational Testing Services

GE Healthcare

Honeywell

Information Handling Services

Intuit

MCI

McKesson

Medtronic

Microsoft

Motorola

National Australia Bank

Nationwide Insurance

Norwegian Cruise Lines

Novartis

Roche Labs

Rogers Communications

Scholastic

SunTrust

Sutter Health

Westpac

Weyerhaeuser