Tag: 360

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TOGAF and Customer Master Data Management (CMDM)

Pretectum Data Governance Wheel

The TOGAF Standards were developed by the Architecture Forum Information Architecture Work Group and approved by The Open Group and are part of an enterprise methodology and framework targeted at helping organizations improve business efficiency.

The TOGAF® Series Guide to Information Architecture: Customer Master Data Management (C-MDM) targets how to “successfully implement C-MDM in an organization to increase the value generated to its customers’ kernel customer data value“.

In this detailed guide, the focus is on Customer Master Data Management as a critical aspect of information architecture that deals with organizing and maintaining accurate, consistent, and complete customer data across an organization.

As a discipline, it involves the processes, governance, policies, standards, and tools that consistently define and manage the critical data of an organization’s customers. In the context of TOGAF, it is a vital part of the information architecture, ensuring that customer data is managed coherently across different business units and technology platforms.

Effective Customer MDM is important for enterprises dealing with diverse customer data sources, such as sales, marketing, customer support, and online interactions.

A centralized and well-organized customer database enables businesses to gain a 360-degree view of their customers. A holistic perspective is invaluable for understanding customer behavior, preferences, and demographics, which, in turn, enables targeted marketing strategies, personalized customer experiences, and improved customer engagement.

The TOGAF Series Guide outlines the key components of Customer Master Data Management within the information architecture framework.

The components include data modeling, data governance, data quality management, data integration, and data security.

  • Data modeling involves defining the structure of customer data and ensuring consistency and coherence across the organization.
  • Data governance establishes policies and procedures for data management, defining roles and responsibilities within the organization.
  • Data quality management focuses on maintaining accurate and reliable customer data and identifying and rectifying inconsistencies and errors.
  • Data integration involves merging customer data from various sources to create a unified view.
  • Data security ensures that customer data is protected from unauthorized access, ensuring compliance with regulatory requirements.

The TOGAF Guide provides a systematic approach for implementing C-MDM using the TOGAF methodology.

This approach involves understanding business requirements, defining a clear vision for Customer MDM, conducting stakeholder analysis, and aligning Custer Master Data initiatives with overall business goals and objectives.

The guide emphasizes the importance of creating a detailed roadmap, outlining specific tasks, milestones, and timelines for implementing CMDM within the organization, and stresses the need for continuous monitoring and evaluation, allowing enterprises to adapt their strategies based on evolving business needs and technological advancements.

There is an acknowledgment of the challenges associated with implementing CMDM, such as data silos, legacy systems, and resistance to change within the organization. To address these challenges, the guide provides best practices, including fostering a data-driven culture within the organization, establishing strong data governance frameworks, investing in advanced data integration technologies, and providing regular training and awareness programs for employees.

By following these best practices, enterprises can overcome obstacles and successfully implement CMDM, ensuring the integrity and accuracy of customer data.

Like all TOGAF Series Guides, this guide is a comprehensive resource that outlines the principles, processes, and best practices for managing customer data within the context of enterprise architecture.

By following the guidelines provided, organizations can enhance their customer relationships, improve operational efficiency, and gain a competitive advantage in the market.

Implementing effective CMDM not only ensures accurate and consistent customer data but also paves the way for innovative and customer-centric business strategies, driving long-term success and sustainability for enterprises in today’s data-driven world.

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Focusing on our Customer Master Data putting business in the black.

airplane on tarmac

Business success is often measured by profitability, but in today’s market, customer satisfaction and loyalty are just as critical.

Companies that prioritize their customer master data quality are better positioned to deliver personalized service and maintain long-term relationships with their customers. There are two outstanding success stories of businesses worth mentioning that recovered from near bankruptcy as a result of changing their focus on customer master data quality.

Now everyone can fly

Malaysia is home to one of Asia’s largest and most successful low-cost carriers, AirAsia, which also has subsidiary airlines in Thailand, Indonesia, Japan, and the Philippines.

According to Advito’s, Mike Eggleton, Director, Research and Intelligence. AirAsia accounts for 94% of all domestic LCC flights. According to the AirAsia X site. AirAsia X Berhad (AirAsia X) is billed as a medium to the long-haul airline operating primarily in the Asia-Pacific region.

First established as Fly Asian Express (FAX) in 2006, it started out servicing rural areas of Sarawak and Sabah with turboprop aircraft before undergoing a comprehensive rebranding in September 2007 followed by our flights to Australia in November 2007.

At the onset of the COVID-19 pandemic, AirAsia X embarked on a period of hibernation of its scheduled flight operations and commenced its debt restructuring in October 2020.

Prior to the hibernation, AirAsia X as a Group served destinations across Greater China, Japan, South Korea, India, Australia, the Middle East, and the United States of America, and currently operates out of two hubs: Kuala Lumpur and Bangkok.

At the completion of its debt restructuring – which was formalized on 16 March 2022 by way of a lodgment of court sanction – AirAsia X now offers increased scheduled passenger flight operations to meet the strong pent-up demand brought on by the global pandemic.

As of 31 August 2022, AirAsia X serves Seoul, South Korea, and Delhi, India.

As a low-cost carrier (LCC) airline based in Malaysia AirAsia faced significant challenges in the early 2000s. The company was losing money, and its competitors were outperforming it in the market. AirAsia was on the brink of bankruptcy. Asian LCCs originally focused on leisure traffic at the lowest possible fares but that’s changed.

The company recognized the need to transform its business model and focus on customer master data quality.

AirAsia realized that it needed to provide a seamless, personalized experience that integrated online and offline customer interactions. They invested in technology to improve their customer management system and provide a 360-degree view of the customer.

In a 2019 interview with Tech Wire Asia, a representative provided insights into not only what the airline did digitally, to delight customers but also how the airline measures customer happiness and endeavors to improve.

AirAsia also implemented a new pricing strategy that included “ancillary services” such as in-flight meals, baggage fees, and seat selection. This strategy helped the company increase revenue and improve customer satisfaction.

The results of AirAsia’s transformation were impressive.

The company reported its first profit in 2002 and has continued to grow ever since with a further enhancement to cloud systems in 2014. AirAsia is now the largest low-cost airline in Asia and has won numerous awards for its customer service and innovation.

Let’s talk about what’s possible.

In the early 2010s, Best Buy, the multinational electronics retailer, was struggling to compete with online retailers such as Amazon.

Best Buy was facing fierce competition, a declining stock price, and plummeting sales. In 2012, the company reported a $1.2 billion loss and was on the verge of bankruptcy.

Best Buy recognized the need to transform its business model and focus on customer master data quality. The company realized that it needed to provide a seamless, omnichannel experience that integrated online and in-store shopping. Best Buy invested in technology to improve its customer master data management systems and drive toward a 360-degree view of the customer.

Best Buy also implemented a new pricing strategy called “price matching” that allowed customers to compare prices with other retailers.

Though hardly a new concept, price matching has been around for many years, in the modern era, price matching has become more widespread and sophisticated, with many retailers offering price match policies as a way to compete with online retailers.

Best Buy implemented its price matching policy in 2013, allowing customers to compare prices with other retailers both in-store and online. This strategy helped the company regain customer trust and loyalty.

The results of the transformation were considered remarkable.

By 2014, the company’s stock price had tripled, and it had become one of the top-performing retailers in the world. In 2018, Best Buy reported its fifth consecutive year of sales growth, and its stock price continued to rise.

Best Buy has continued to perform well since 2018.

The company has been able to maintain its momentum and consistently report strong financial results. In FY 2021, Best Buy reported revenue of $47.4 billion, up 8.6% from the previous year. The company also reported net earnings of $1.7 billion, up 23.6% from the previous year.

The business has also continued to focus on its customer-centric strategy, investing in new technologies and services that enhance the customer experience.

An expanded online ordering and curbside pickup option were added, allowing customers to shop more conveniently during the COVID-19 pandemic.

Best Buy has also invested in new services such as tech support, home installation, and repair services, which provide additional value to customers and help differentiate the company from its competitors.

The company has made significant progress in reducing its carbon footprint, and in 2020, it was named to the Dow Jones Sustainability Index for the seventh consecutive year.

These two success stories demonstrate the critical importance of customer master data quality in today’s market.

AirAsia and BestBuy both recognized the need to transform their business models and focus on delivering a seamless, personalized experience to their customers.

By investing in technology to improve their customer-centric systems and provide an improved 360-degree view of the customer, both companies were able to increase customer satisfaction, improve retention, and ultimately recover from near bankruptcy.

Companies that prioritize customer master data quality are better positioned to succeed in today’s market and maintain long-term relationships with their customers.

Further reading: How customer relationship management, perceived risk, perceived
service quality and passenger trust affect a full-service airline’s passenger satisfaction

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Customer Fundamentals – time to take a big step

muscular female dancer rehearsing in spacious studio

Master Data Management may be positioned as a “silver bullet” for the woes of poor customer master data but it doesn’t solve long-standing systemic organizational deficiencies.

Any organization embarking on any kind of Master Data Management (MDM) initiative will need to look long and hard at a number of characteristics of how data is created, described and managed that are independent of the MDM itself if they wish to get the best value from their MDM.

That highly desirable 360º view of the customer, for example, what is it exactly?

Benefits as described by vendors and industry experts are numerous, but perhaps a small handful is the most important and most achievable.

  • Reducing the costs and risks of customer data ownership
  • Reducing friction in transacting or engaging with the customer
  • Improved customer segmentation and targeting lists

All three of these outcomes are however heavily contingent on a number of important behaviours and organizational culture shifts.

While business leaders focus on strategic objectives and how performance metrics demonstrate the business value they will also be looking at hard metrics that can be used to baseline the status quo and then reveal improvements after the implementation of a master data management governance initiative.

None of the statements of benefit outlined above is specific enough to fall in line with the leadership needs of hard numbers but they could be further refined in order to be more specific and measurable.

Real business value drivers at best will be lagging indicators such as customer retention and increased revenue but it may also prove to be challenging directly attributing these to an MDM implementation program. In itself, an MDM program implementation may also not be able to guarantee these benefits.

While the outcomes may be a little fuzzy and difficult to guarantee, the fact of the matter is that there will be improved clarity on the state of the data and the potential in terms of analytics and insights from the customer data that may not presently exist.

Clarity on customer behaviour and the potential for predicted behaviour is really only possible if you have the data and in particular, have a unified repository of complete and appropriate customer data.

A structurally and semantically consistent customer master data view can often produce welcome side benefits such as:

  • Appropriate data acquisition valuation
  • Reduced M&A costs
  • Improved regulatory compliance (GDPR, CPA, HIPAA etc)
  • Improved employee productivity (Service, Support, Collections, Sales & Marketing)
  • Reduced fraud risk
  • Increased customer revenue
  • Optimized outbound marketing spend
  • Improved billing and collections
  • Improved sales and service execution

It is important to remember that any MDM tool itself will not guarantee any particular results if the program is implemented without careful consideration of the organizational context. For this, an assessment of the customer master data management maturity is an important first step in any implementation.

Targeting thoroughly practical, data-oriented benefits as part of a Customer MDM initiative will help align organizational expectations with the capabilities of any given solution. This in turn will lead to the most obvious and verifiable information-based outcomes that will inform the business and empower staff.

To ensure appropriate MDM adoption, it needs to effectively deliver on a recipe with repeatable and scalable outcomes that encourage adoption and support from all key stakeholders and data users.

We believe that with the Pretectum CMDM, a narrowly focused Customer Master Data Management platform, you can take bold first steps toward organizational change and an improved closeness to your customers. Contact us today to learn more.