In these tough economic times, companies are looking to leverage their existing assets to cut costs and grow their businesses. These assets include physical, human and informational assets. Physical assets include plants, machinery and buildings. Human assets (people) use these physical assets to deliver products and services to their customers.
In recent years, companies have generated huge amounts of data in the process of ideating, developing and delivering products and services to customers. The data is resident in companies’ information systems, often in enterprise resource planning systems. As companies mature, they face formidable challenges in managing this growing mountain of data. Over time, many corporate strategies evolve as a result of changing business climate and issues, resulting in strategies that are often reactive and suboptimal.
Businesses can adopt a comprehensive approach that businesses to effectively leverage information in ERP systems for competitive advantage. The approach outlined in this article serves as a useful starting point for adopting an effective EIM strategy or to validate an existing EIM strategy.
Companies need to pursue the following elements of a four-dimensional strategy to ensure a comprehensive approach to EIM. This strategy takes a “lifecycle” approach to EIM, i.e., it is based on how data is acquired, managed, secured and disposed of in an organization. Most of the other approaches are based on classifying data based on its type (for example, into master data, transaction data, metadata, etc.) but they do not provide insight into how an EIM strategy should be initiated and deployed within an organization.
EIM Governance: The core of the strategy is based on the right governance structure for managing EIM initiatives within the company. First, the governance team should establish the policies and procedures to launch EIM projects based on long-term business strategy and return on investment. ROI places a quantitative value on the business benefit of the program or project that leverages the information resident within the company. The governance team should consist of both providers (e.g., the order management team which is the source of transactional data) and consumers (e.g., the business intelligence team which uses transactional data to provide reports or inputs to senior management).
The governance team plays a pivotal role in ensuring the right projects are accepted. In the initial stages of the company’s EIM roadmap, focus should be placed on projects that help companies acquire information.
Acquire: Companies acquire information through internal (transactional as well as other operational systems) and external systems during the course of running their business. The process for validating, accepting and managing this information is an important part of the EIM strategy. Typically, enterprise-wide standards have to be implemented to ensure the correct level of information is captured during these interactions to enable a cohesive EIM strategy.
Share: One of the major problems that enterprises face is that organizational information is in silos and there is not a single view of customers, suppliers, partners or even employees. These problems multiply when companies acquire, merge, disinvest or spin off divisions or geographical units. Projects and initiatives that enable enterprise information to be transparent and readily available to business leadership and other stakeholders fall under this category. These initiatives (for example, data warehouse, reporting, etc.) thus enable quick decision-making and help senior leadership to understand how different businesses and geographies have performed. BI and data warehouse tools are typically used to enable these initiatives.
Improve: The quality of information available within a company’s systems is dependent on innumerable factors, some of which are beyond enterprise control. Companies receive feeds and data from suppliers, partners and customers, and there is high likelihood of inconsistent data quality. These problems become apparent during software upgrades and migrations or ERP implementations. IT leadership should measure the information quality through various metrics (such as error rates in order or service fulfillment, invoicing and billing errors, etc.) and target specific improvements through focused projects that improve information quality.
Secure: Every enterprise has to zealously guard their informational assets against willful or accidental breach of security. The potential hit on company’s business makes it imperative for IT leadership to ensure security of information. Projects and processes to ensure the right level of access and security need to be implemented to ensure a strong and secure informational infrastructure that business leadership can rely on to make tactical and strategic decisions. Projects that help ensure security of information are typically run in parallel to other programs that acquire, share and improve the enterprise information infrastructure.
Evolution of EIM Strategy
Tailor the EIM strategy based on specific company needs. Startups and young companies typically focuses on acquisition of information programs and projects that will help them generate leads and opportunities to sell their products and services. Companies that are more established tend to focus on improving the quality and transparency of the available information. Lastly, companies in highly regulated and competitive industries (for example, government, health care and financial services) invest a significant portion of their IT budgets in information security initiatives.
EIM Building Blocks
Some of the technology building blocks supporting a successful EIM strategy involve a service-oriented architecture that will enable improvements to ensure companies can acquire, share, improve and secure their information assets. In addition, companies need to standardize on tools, processes and standards to ensure their EIM strategy is understood and implemented at all levels of the organization. Further, given the global nature of the business, IT leadership should evaluate their systems, processes and tools that can adapt to global and virtual teams.
In the coming years, enterprises will increasingly face challenges relating to unstructured information like emails, text messages, tweets, blogs as well as internal portals and other content management tools. The strategic elements to manage these streams of information remain the same. However, software tools and applications will continue to evolve and help achieve a unified lifecycle-based EIM strategy.
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