Integration and the Customer Data Hub

This is because most companies have a decentralised organisational structure in which each department has created its own system for handling customer information.

This information is not - and often simply cannot be - shared across the company, so it is referred to as the "silo" approach. In addition, each department may cleanse and standardise the data at each source separately, resulting in inconsistent and redundant processes along with significant additional costs.

The result is that senior executives are often making critical business decisions on intuition or old data rather than on credible information. There is enormous interest in the business community of integrating computerised data to deliver a "single source of truth" to top management.

Oracle, the leading enterprise software company, has developed its own solution, which it calls the Oracle Customer Data Hub. This is an innovation in software "architecture" that allows all legacy system and third-party information to be collected centrally in an online repository, to present one customer view across the entire enterprise.

The beauty of the hub environment is that the single source of truth can be achieved without disrupting existing business processes or requiring costly information technology (IT) reinvestments. Furthermore, all data quality and data maintenance services can be centrally maintained and managed, with the clean and standardised data flowing throughout the organisation and available to all users across all departments.

The conceptual breakthrough in the Customer Data Hub comes in understanding that certain data entities are shared resources across an organisation. Instead of each department maintaining its own version of a customer record separately, all shared attributes describing the customer record are merged into a single master file.

This approach allows for all relevant business transactions, activities and interactions to have visibility without the requirement of costly movement of transactional data. The data entities are the cross-reference keys that allow organisations to obtain a single source of truth without having to disrupt the transactional systems that are running the business.

"The Customer Data Hub is an operational system working in real time," explains Anthony Peake, Senior Director, Marketing, at Oracle EMEA. "As data enters the hub, the system automatically begins to verify, cleanse, de-duplicate, and merge the information - and then synchronise all systems. As a result, all corporate users - regardless of their role or location - use the same accurate, continually updated information."

As an analogy, think of the public water system. The water is centrally collected, purified and tested, then distributed from the pumping station to all connected users.

This is infinitely more logical than circulating untreated water and expecting each user to install a complete water filtration and testing system. With the hub as the data clearing house, all source systems use the same standardised processes and "clean" source of information.

Visitors to the United States may be familiar with the International House of Pancakes (IHOP) restaurant chain, which is an American institution. IHOP perfectly illustrates the financial potential of the Customer Data Hub model.

IHOP's corporate headquarters realized that the organization lacked a view into its franchised restaurants and wanted better visibility into the day-to-day operations of each of its locations.

Each franchise maintained its own data - legal, finance, operations, marketing, personnel - and had its own resources devoted to managing that data. As a result, poor business decisions were being made and operational errors were occurring too frequently. In short, executives and managers could not vouch for the very data they were relying on to make key business decisions.

IHOP has begun to deploy its version of the Customer Data Hub - a franchise data hub - to collect all the different "silos" of information. In doing so, the company has not only eliminated the need for multiple data managers but also ensured that every department could see every interaction that had taken place with every customer.

The second phase of the deployment will focus on gathering customer data and feedback from its frequent diner programmes and complaint cards in order to deliver better customer service and improve targeted marketing campaigns.

IHOP believes that this unified view will impact its operations at every level. At the service level, customer interactions will become more efficient. From a strategic standpoint, IHOP will be equipped with real-time access to critical data on customer spending habits and regional trends that it hasn't had before.

The hub will also collect data from the restaurant's point-of-sale systems and various business applications (which will manage finance, human resources, etc) to get a clear, accurate view of all the information coming from each restaurant.

Enterprise data can only reveal so much. While sales numbers may tell how much business was done in Europe for the last fiscal quarter, they won't reveal that only 25 percent of deals were closed, or that a major customer broke off negotiations and subsequently signed a contract with a competitor. Marketing totals also will not explain local purchasing trends, average lead generation costs or how effective a national marketing campaign was in targeting a specific audience.

These and countless other business answers can be extracted from a centralised Customer Data Hub. With built-in analytic tools, managers can model customers in all their complexity and look at customer data consolidated from across all operations, rolled up into hierarchical structures (such as a family of companies or households), or graphically segmented for analysis.

This real-time visibility allows for fact-based decisions to drive change and increase efficiency. The financial picture is dynamic, and can be adapted to reflect sudden market changes or windows of opportunity, such as spikes in supply or demand.

To be meaningful, customer data must be up-to-date and fit to be reported. With scores of data silos around the world, companies today operate with huge information blind spots. It can take weeks - even months - to collect, reconcile and analyse corporate performance data.

And at a time when corporate accountability is under intense scrutiny, corporate and financial officers need current, enterprise-wide business intelligence. This need is driving adoption of the data hub model, which offers several distinct advantages.

With built-in integration and data management, information from across the enterprise can be centrally located and stored. With access to this customer data, companies can analyse information across multiple product lines, geographies, departments and applications. Third-party content can be leveraged to augment and verify customer information, as well as to keep abreast of changing corporate relationships.

As a result, hub users can improve business operations and strategies by enriching the quality of their data, without having to replace their IT infrastructure. And as businesses grow, they can scale their current systems without sacrificing integration.