Challenges of Information Management in the Retail Industry and Best practices for a successful MDM Implementation

1. Lessons learned from successfully
implementing MDM for Key retailers and
wholesalers in Europe
Ariel Aubry - EBC Business Consulting

2. Challenges of Information Management - Issues
Volumes increase
SKUs : 5 000 / to 5 Millions
Stores : 1000s
Regions / Countries : 10s
Promotions : 1000s / year
Millions of hours spent yearly
Data is getting more complex
Prices
An Distribution circuits
Product composition
Increasing Organization (WHS,POS,PD…)
complexity
Multiple Inbound and outbound channels
Multiple sources (vendor, datapool)
New channels, specific yet consistent
Mergers & Acquisitions
Lessons learned from successfully implementing MDM
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3. Challenges of Information Management - Benefits
Information Demand increase
Consumer (Marketing, Environment)
Legal (Traceability)
Business Innovations (VMI)
Time to market Reduction
Shortened Product life cycles and acceleration of NPI
Delocalized production centers
JIT synchronization with production
Business Leadership
Business Innovations
Excellence in the Supply Chain
Large Offering
Improve Quality through Collaboration
An increased Operational efficiency
demand Improve Service Level
from business Benchmark across regions/brand/competition
for operational Reduce Operating Costs
efficiency Optimize resources allocation/rotation
Improve invoicing/payment
Lessons learned from successfully implementing MDM
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4. Lessons learned from successfully implementing MDM with key
Retailers and wholesalers in Europe - SOLUTIONS
Master Data Management is meant to address the challenges of
information management.
Three configurations emerge
MDM to optimize Publishing Flows
MDM to optimize Business Partner flows
MDM to optimize Internal Flows
Lessons learned from successfully implementing MDM
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5. MDM for Publishing Flow Optimization
ERPs (SAP, …) Web
Technical Data
CDROM
PLM
Publishing MDM ecatalogs
Legal Databases
(per market, country, brand, medium,
customer segment, channel, etc)
Flyers
Marketing
Digital Asset Management Paper
Other IS Other IS
Lessons learned from successfully implementing MDM
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6. MDM to optimize Business Partner Flows
Retailer 1
Manufacturers
Retailer …
Partners
Retailer N
Public Database DataSync
MDM
Provider Web
Other IS Other IS
Lessons learned from successfully implementing MDM
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7. MDM For Centralizing Data & Processes
Merchandising
System 1
Vendor
Merchandising System N
Partner Legacy
Central Repository
Legal databases
Data Pool
data and processes centralization,
brand, country specifics, etc
Marketing
Public Database
Digital Asset Management
Other SI
Partner IS
Lessons learned from successfully implementing MDM
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8. Focus on Retail - MDM For Centralizing Data & Processes
ERP
Listing Processes
workflows CRM
Vendor
Data Quality
Merchandising
Data Pool GS Productivity tools
POS
User roles and rights
Data Provider Connectors Tracking & RFID
Other IS Listing Datawarehouse
Items, Vendors,
PreList Organization,
Items, Vendors Classification, Pricing,
Customer, etc Ecommerce / catalogs
Lessons learned from successfully implementing MDM
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9. Focus on Retail - Typical Application Architecture
Vendor Portal Sourcing GDS
Pre Listing Application
Item / Vendor / …
Offer Deals Price Mgt &
… Promotion Mgt Optimization …
Construction & Negotiation Listing Application Gestion
Mgt de
Item / Vendor / … Nomenclature
Referential
Item / Vendor / Trade Conditions / Locations / Classifications /
Parameters
Supply chain Operations Accounting Business …
Logistics, replenishment,
warehouse Mgt Management Finance Intelligence
Lessons learned from successfully implementing MDM
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10. Comparing Custom, PIM and ERP implementation
Custom Development PIM ERP
Strengths Strengths Strengths
• Full ownership • Ease of implementation & • Built-in Consistency with
• Zero constraint evolution Operational processes
• Ultimate Customization • IS Independent • Predefined data model and
• Built-in “MDM functions” Business rules
• Unlimited information enrichment
Weaknesses Weaknesses Weaknesses
• Cost of ownership • Business User experience (GUI) • Rigidity (cost and capacity)
• Effort wasted on low level MDM • Performances for high volumes • No built-in MDM Function
• Maintenance issues • Business Requirements definition • MDM User experience (GUI)
• Limited features (hierarchies, …)
• No Business Req. challenging • Solution limitations
• Blank page syndrome
• Risk
Lessons learned from successfully implementing MDM
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11. Methodology and Main lessons
A step by step methodology to :
Demonstrate quicks wins
Avoid “Boiling the Ocean”
Ensure gradual adoption
Lowering the risks
Increase ROI
Reduce time of delivery
Defining at the same time a clear target roadmap:
Functional perimeter Short term/middle term
Organization
Ownership of data
Core system approach to be rolled out for multi countries/multi brands.
Technical fundamentals
Lessons learned from successfully implementing MDM
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12. Implementing a Merchandise Repository is far from being just an IT
project
7 key Elements to Control before and during the Project
Business Strategy
Sponsoring
Governance
Scope
Architecture
Implementation
Change Management
Lessons learned from successfully implementing MDM
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13. Elements of attention – Strategy & sponsoring
BUSINESS STRATEGY
Position MDM with respect to the Company’s Business Strategy
… because nobody should do MDM for the hype
… because you should know your major focus at this stage (supplier negotiation, data quality,
operational efficiency, etc.)
Identify an overall budget for the Operation
… because MDM will require to adapt your legacy and your organization more than you originally thought.
… Initiating a design to cost approach is therefore mandatory
Identify the expected Return on Investment, Key Drivers, KPI
… because from project kick off, each and every department will have terrific ideas for unplanned and
unbudgeted new features, key to their business, but not on the MDM original Roadmap, nor aligned
with the Company’s Business Strategy
Lessons learned from successfully implementing MDM
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14. Elements of attention – Strategy & sponsoring
PROGRAM SPONSORING
Identify One Sponsor at the highest level, fully dedicated
… because changing the way you manage your Reference Data impacts Roles and responsibilities across
the Company, as well as for customers and suppliers. Arbitrage will be required at the highest level
Identify Program Manager and Core team
… because somebody needs to start working !
Communicate and assess overall perception
… because everybody will be impacted by the MDM initiative. Change Management should be started early on
Avoid effective leadership by operational managers
… because engaging in MDM is an opportunity to onboard new concepts and processes, not to just automate
current data management practices
Lessons learned from successfully implementing MDM
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15. Elements of attention – Governance & Scope
GOVERNANCE
Identify the ownership of the data
… because some data will be kept central, while some other data needs to be handled at the local
(region, store, warehouse, country) level
Identify the organization and processes required
… because the point with MDM is precisely to redefine who does what with your data, when ,
in what sequence, etc.
Assess Change Management
… relating to the new organization, processes, and applications
Take for granted that you underestimated Data Migration and anticipate cleansing in
Legacy
… because this is our conclusion after 30+ projects (incomplete data, duplicates, obsolote, etc)
… because your MDM initiative consist also in stricter quality controls, additional fields, new concepts, etc
Lessons learned from successfully implementing MDM
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16. Elements of attention – Governance & Scope
SCOPE
Identify short term / mid term / long term scope
… because you need to succeed on quick wins while setting a long term objective
… because you need to communicate to business departments and onboard them at the right time
… because your business case depends on it
Cover Global issues
… because if you postpone critical analyses (such as item or supplier ID unification, price management,
master/slave IS, etc), these topics we’ll haunt you and jeopardize the success of our initiative.
Tackle all this early on
Prioritize to deliver rapidly and ensure momentum
… because due to their impact on systems, organizations and people, due to the hopes they generate,
MDM project have more than any project a risk of getting stuck
Assess unplanned enhancements (GUI, etc.) versus cost and timeframe
… because business users will have every reason to require a user-friendly system for their daily tasks,
but setting up custom GUI on MDM is always costly
Focus on the MDM expected value, not on a technical migration
… because otherwise you end up duplicating your legacy, with absolutely no added value for business
Lessons learned from successfully implementing MDM
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17. Elements of attention – Architecture
ARCHITECTURE
Define as is and to be Information System Landscape
Define evolutions to current legacies, and their new responsibilities
… because legacy modification costs happened to be showstoppers on some projects (concepts, fields, etc.)
Prioritize and implement evolutions to existing Information Systems
Define integration mechanisms and implement data flows
… because automating the sharing of data means new flows within your organization and your IS
Define and prepare data to migrate
Define and implement major processes and workflows
Estimate and follow key volumes (data and users)
Identify technical constraints
Define Service Level Agreement, per region, country, etc.
… because your MDM may endup critical for operational processes
Identify hardware, environments, infrastructure, operations requirements.
Identify maintenance and operating skills, per region, country, etc.
Onboard the Right technical Expertise
Lessons learned from successfully implementing MDM
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18. Elements of attention – Implementation & Change Management
IMPLEMENTATION
Identify major constraints (business deadlines, concurrent projects, resources
availability, etc)
… because your MDM project will very likely end up being on the critical path of most of your portfolio
projects
Select the solution best fitting the context (scope, technology, constraints)
… because some solutions are better for your specific requirements (collaborative, hub GUI, Volumes, etc)
Assess skills required, define team and assign roles and responsibilities
Define Deliverables, Q&A, Planning, tools, etc
Launch Implementation project
CHANGE MANAGEMENT
Communicate on the Change in the Organization and Processes before and during the
Project
Make sure every Project participant is trained on the tool and its concept prior to the
project start
Leverage the UAT phase to train the Users on both the tool and the processes.
Lessons learned from successfully implementing MDM
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19. Main Lessons
Strong sponsorship
Business enabler
(New concepts enabler, Innovation engine)
Global IT strategy &
Change Management roadmap
Organizational Challenges IT challenges
(MDM team and processes, skills) (skills, technology and concepts)
Lessons learned from successfully implementing MDM
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20. About EBC Business Consulting…
EBC - EBC Business Consulting is a Management and Operational Strategy
consulting firm, specialized in the Service Industry (Retail, Insurance and
Assistance, HR, etc)
EBC Business Consulting help C-level executives execute their strategy, helping
them shape their vision into strategic initiatives and deploying them throughout
their organization.
Our services offering encompasses Operational Efficiency Improvement,
Company or Key Program turn around, IT Strategy and planning, Business
Process Optimization, Change Management
EBC Business consulting is an independent management consulting firm with
locations in Paris, Boston (USA) and Calcutta (India)
For more information, please visit our website at www.ebc-businessconsulting.fr,
consult our white papers or follow us on blogs and social networks
Lessons learned from successfully implementing MDM
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21. 64 rue du Ranelagh
75 116 Paris
France
Phone: +33 (0)1 56 90 50 40
Mail: ariel.aubry@edifixio.com