Why Data (Harmonization) Is The Oil That Drives The New Digital Transformation Engine
From a procurement standpoint, if organizations hope to drive competitive advantage and bottom-line results it is not just a question of convergent technologies, but data harmonization. Jon Hansen, Supply Chain Management and Procurement expert, explores the "what" and the "how".
Just recently I had the opportunity to spend some quality time with the new President of Microsoft Canada Kevin Peesker.
In talking with him about everything from the need to encourage women to pursue careers in STEM industries, to digital reinvention and how “most incumbent firms are failing to adjust to the digital era,” it was his case study reference in a recent article he wrote that captured my attention. Specifically, how activated data drives everything from our cars to our decision-making in real-time.
In the article, Peesker talked about Mojio, a company whose platform provides you with simple, snap-in access to the data generated by your car through an app that enables you to plan and record trips, share driving information and understand overall vehicle health.
Of course, the above reference to Mojio is just one example of how data as one person put it, is the “oil that drives the digital transformation engine.” The play on words notwithstanding, our view of data has changed considerably from when we saw it as a passive asset that you simply had to store and protect. Today, data “actively” permeates all areas of our world both in business and in our everyday lives, so harnessing its power from multiple sources be it a public cloud, private cloud, or no cloud/legacy environment is critical.
In the case of Mojio who, according to Kevin’s article, currently lives in 5 countries. Their app is now “connected to more than 5000 unique vehicle models, with 500,000 paying subscribers who have driven 5,000,0000+ miles making them the leading platform in the aftermarket for connected cars.” Talk about hyper-convergence!
However, to harness data’s power and promise, I believe that we have to look beyond the hardware/software architectural make-up associated with hyper-convergence, to the data itself.
In this context, and from a procurement standpoint, if organizations hope to drive competitive advantage and bottom-line results it is not just a question of convergent technologies, but data harmonization.
What Is Data Harmonization?
In its most basic form, data harmonization is “the process of bringing together your data of varying file formats, naming conventions, and columns, into one cohesive data, set.” 1 While at its elemental roots this description is accurate, it doesn’t go far enough to reflect the dynamic impact that data has on our lives.
Think about it for just a moment; if we are relying on data to provide the real-time intelligence on which the Internet Of Everything operates, then that data has to be consistent and accurate. Said consistency and accuracy can become problematic when the collective data’s origins are both geographically and platform diverse.
I can readily recall the lament of a senior executive from Duke Energy who, shortly after the company’s $9 billion acquisition of Cinergy Corp. in 2005 talked about the challenges of having to integrate eleven legacy systems. And remember, the Duke exec was speaking from a technology architecture standpoint as opposed to a pure data standpoint.
In today’s global marketplace, such integration challenges now extend outside of an M&A or existing corporate infrastructure to include many more partners. In fact, when it comes to the evolving nature of business relationships and its implications on data compilation and sharing the famous Gumpism about never knowing what you are going to get is truer today than ever.
Seeing that this is a Synertrade blog, the perfect example of this expansive diversity is the Lufthansa Group Project with 17 SAP, 2 SAP BW, 1 Oracle Database, and 129 subsidiaries.
In the case of Lufthansa, data harmonization was critical in bringing together these diverse sources of information ensuring the execution of a cohesive and coherent data transformation strategy.
All this to say is that the more we depend on data running every aspect of our business, the more vulnerable we become to the potential vagaries that can leave us in a less than an enviable place. I don’t know about you, but if data is indeed the oil that is driving the engine of the new digital era, then I want it to be as pure and reliable as possible so that I don’t break down on the side of the road, lost in the middle of nowhere.
Data Q&A Filtering
One of the biggest raps against the traditional ERP platforms – particularly from a procurement standpoint, is the fact that by the time the data made its way into the hands of the purchasing manager it was already outdated.
While today’s cloud-based solutions have addressed the speed lag, the major challenge has become one of data integrity. Like the old garbage-in, garbage-out axiom, just because the information flow is high speed doesn’t mean that it is high quality.
So in the end, harmonization isn’t just about bringing data together from a multiple source standpoint, it is about bringing together the pure “filtered” data that accurately reflects your organization’s truth that is the real goal.
To do this effectively, you need a sound data quality management process that can in real time, identify and address inconsistencies so that you can maintain the highest level of data integrity and insight. Or as the famous Deming quote goes, “if you can't measure it, you can't manage it.” Without having accurate data, measurement is virtually impossible.
In this context, I guess it is true; data (harmonization) IS the oil that drives the new digital transformation engine.
Jon Hansen is an expert in all areas of Supply Chain Management and Procurement. He is the owner of Procurement Insights and as a lecturer/speaker he is also a business radio talk show host. He writes blog posts for SynerTrade North America, to share the best practices and knowledge around Digital Procurement.