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Four steps to formulate your customer data management strategy

Forrester's Mike Gualtieri details how to develop a unified plan for managing customer data that gives business users what they need to succeed.

Customer data silos are bad. We all know how it gets to that point: years of building requirements on top of requirements,...

the creation of business and technology stovepipes, and the lack of a clear customer data strategy. The resulting hodgepodge of databases, applications and systems leads to business process workarounds that limit the ability of a business to move forward as fast as it wants to. Customer data management has become a top priority now that we are living in the age of the customer, and your CDM strategy will set the table for the future of customer loyalty.

The goal should be simple: Provide your business functions with quick and complete access to all of the customer data and analytics they need, both now and in the near future. The key question is: How do you formulate a next-gen strategy that is both visionary and pragmatic? Here are four steps that organizations can take to get to where they want to go.

Mike Gualtieri Mike Gualtieri

Step 1: Identify the stakeholders for your customer data -- and who owns it. No one person has complete visibility into customer data requirements across your entire business. While functional areas -- including product development, operations, marketing, sales, finance and customer experience management -- have many requirements in common, they all have unique requirements as well. And when a business has multiple divisions, customer data requirements become even more complicated. The first step in formulating your strategy is to assemble a working group of customer-data subject matter experts (SMEs) across all of the functions and divisions in your business. This working group will play a key role in helping you understand the requirements across the organization in order to avoid creating yet another CDM silo.\

Step 2: Perform a needs assessment. With your strategy team in place, it's time to harvest their wisdom. The current and future requirements of your entire business must inform your customer data strategy development -- or it's doomed to fail. Your working group needs to help you perform a needs assessment. This assessment shares all of the characteristics of a traditional requirements-gathering process, but with a careful eye toward likely future requirements as well.

Surface requirements by reaching out to the members of your working group through surveys, individual interviews and group meetings. Which business capabilities and processes create, transform and use customer data? The best way to get at these requirements is to ask SMEs to describe existing and planned business processes that directly involve customers or prospects -- doing so will reveal customer data needs and applications. It's also valuable to have an IT expert participate in sessions with business SMEs to fill in the technical details of where the data resides and how it flows through your technology architecture.

Step 3: Ideate your strategic options. You should now have the essential business and technical understanding of the customer data within your organization. Using that understanding to formulate a CDM strategy is the fun part if you're creative and like to solve puzzles. You have to make sense of all of the requirements gathered during the needs assessment to generate strategic options for your stakeholders to consider. Remember the end game:

Your customer data management strategy must provide your business with quick and complete access to all of the customer data and analytics it needs, both now and in the near future.

The key elements of your strategy will include business imperatives, technology and an implementation roadmap. The business imperatives will catalog the changes that the various functional areas and divisions need to make to streamline access to and sharing of customer data. The technology will make it possible. The roadmap will document what it will take to make it happen.

It can be hard to know where to start the ideation process. Looking from the top down can give you the best view and ideas, but it overlooks the mess of processes and technologies that a pragmatic strategy must address. Looking from the bottom up categorically acknowledges your existing processes and technologies, but it can overly constrain your ideas. The best solution is to oscillate between the two. Devise a big-picture idea unconstrained by existing processes and technology, and then dive into the depths to see how practical the plan looks -- and to uncover technical ideas that magically resolve major requirements.

Step 4: Prioritize your strategic options. Now you're ready for the final step in this strategic exercise: an internal roadshow to get stakeholders to choose from among the two or three options you came up with during the ideation phase. This step includes getting business buy-in from all of the stakeholders, including the executives who ultimately will have to approve and fund the effort to implement the new strategy.

About the author:
Mike Gualtieri is a principal analyst at Forrester Research Inc. serving application development and delivery professionals.

Email us at and follow us on Twitter: @sDataManagement.

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This was last published in December 2013

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What's your top tip for successful customer data management across an organization?
For customer data management strategy, you need to look into software’s that will help you in a better way. It is because the management of data to a certain section really becomes difficult if they are not handled properly. They get mixed up with one another and there should be a special slot so that data is organized in a better way. I think my software takes care of such issues and never lets any pile of data to be accumulated.
 or <Data Quality> tags around the desired text. Ex: <Data Quality>insert code