Customer data integration expert predictions for 2007

Customer data integration (CDI) is poised for another good year, according to experts and analysts. Learn what to expect in the CDI market.

We've learned a lot about customer data integration (CDI) in 2006. CDI is now widely recognized as a subset of the master data management (MDM) discipline, and the CDI software market is maturing, according to Gartner's Magic Quadrant. But as companies deploy CDI, they're also finding that there's much more to it than technology. Data governance programs and organizational support are critical for CDI or MDM success and a challenge...

even for Microsoft, which kicked off its CDI project last year. So, what's in store for 2007? SearchDataManagement asked four CDI experts for their market predictions.

Jill Dyche and Evan Levy
Partners with Baseline Consulting, and authors of Customer Data Integration: Reaching a Single Version of the Truth

Pose your own question to Jill Dyche about CDI on our "Ask the Experts" section

 

  • 2007 will be the year of implementation. We believe this not only because our book is doing well, but because the companies who retained us to assess their CDI readiness this year are now budgeting for projects next year. This was the year of research. In 2007, more companies than ever will be taking it out of the box.
  • Definitional debates will continue. We're finding that people's definitions of CDI and MDM vary depending on where they come from. The service-oriented architecture (SOA) crowd loves the "data as a service" approach, while data warehousing acolytes emphasize the "management" piece of MDM. Explaining all this to business managers who need purpose-built solutions in order to operationally integrate their customer data will remain a challenge.
  • CDI and MDM will mandate data governance. While a luxury for business intelligence and CRM initiatives, data governance is required for sustained master data management. The "what is a customer?" conversations have begun anew as companies rework the business policies associated with data standards and access. It started with compliance, but businesspeople are realizing that their customer relationships are more complex than they thought as they re-examine their preconceptions about customer value.
  • Companies will insist on seamless integration. As business and IT managers evolve their CDI and MDM maturity, they'll reject vendor "bolt on" strategies, insisting instead on solutions that streamline data cleansing and integration functionality. SOA will make this vision a reality.

John Radcliffe
Research vice president with Gartner Inc., a Stamford, Conn.-based analyst firm

  • Organizations will think more broadly than just CDI. While companies may start with CDI (or product information management), they'll be thinking about other kinds of master data, too. CDI vendors will also start to develop capabilities for managing more than just customer data -- a trend that's already started as more vendors launch MDM tools.
  • Look for an increased focus on organizational hierarchy management. This feature is particularly relevant for business-to-business vendors, which have a compelling sales need to understand how their corporate customers are organized.
  • "Verticalization" of CDI technology tools will become more prevalent as the market matures. Increasingly, vendors will be talking about creating tools with functionality designed for vertical markets like finance and healthcare.
  • CDI/MDM will more often be deployed within a BI context. The current focus of CDI has been on integrating transactional systems to get a single view of the truth. But 2007 will see more CDI/MDM in the BI market, integrating systems for analytics and reporting purposes.
  • Companies will give more attention to governance. Some companies' biggest problems have involved data governance, politics, change management and data ownership. There will be more news about failed CDI deployments, potentially due to governance problems, rather than technology ones.
  • More organizations will evaluate and/or deploy CDI software. As the market progresses beyond early adopters, more organizations will be looking closely at business cases, ROI justifications and case studies.

R. "Ray" Wang
Senior analyst with Forrester Research Inc., a Cambridge, Mass.-based analyst firm

  • Consolidation will continue and whole series of vendors will converge. Business intelligence vendors, in particular, will take a new interest in customer hubs and master data management. Look for BI vendors collaborating with (or acquiring) CDI vendors to provide tighter integration.
  • Many CDI/MDM vendors will eventually find their way into the middleware space. This trend will be driven by a new need for data-centric processes to occur within cleansed data environments.
  • The market for CDI and customer-centric master data management tools will continue to take off. Right now, there is only single-digit penetration of CDI/MDM tools within the enterprise, but the market is just at the beginning of a curve that will see a sharp rise by 2008.

Aaron Zornes
Founder and chief research officer for the CDI Institute, a San Francisco-based analyst firm, and chairman of the CDI-MDM summit conferences

  • The CDI market will grow more than previously expected. The CDI Institute originally predicted that it would be a $1 billion market by 2008, but we now believe growth will outpace that figure. CDI vendors are spending a lot on marketing efforts and helping to drive user demand.
  • The financial services industry will pioneer best practices for data governance, which is a requirement for CDI success. Companies will continue to seek methodologies and best practices for data governance programs. Since financial services companies have been leading the adoption of CDI technology, and already must manage regulatory compliance, they will be a natural pioneer of data governance best practices.
  • Users will continue to be shy about sharing CDI experiences. In the age of privacy and data breaches, any discussion of customer data is potentially a public relations problem, so many companies just won't go there. Also, since CDI is increasingly considered a competitive advantage, companies should adjust expectations for references. Rather than seek out references in the same industry, companies should look for reference deployments that are comparable in complexity and scale.
  • Expect midmarket products from the likes of Microsoft, Sybase and others. All database vendors will need an MDM strategy, and there's probably some planning going on now. The new midmarket CDI tools are likely to be less complex and less costly to install.
  • Look for an increased focus on registry-style CDI deployments. These "lightweight" registries, delivered by vendors like Purisma, Siperian and Initiate, can deliver a unified view of data across systems with less time and expense than a new persistent hub. Even IBM and Oracle are looking at this deployment style as a way to get customers started with CDI. The registry approach enables a simpler startup and can deliver business value, too.

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