Undelivered promises of an “information nirvana” are leaving many enterprise CEOs frustrated by costly data warehousing and ERP implementations, according to one industry consultant.
With this in mind, Electronic Data Systems (EDS) Corp. has signed a letter of intent to form a three-way partnership with NCR Corp. and consulting firm A.T. Kearney in order to offer complete business-intelligence services to corporations.
Aaron Zornes, executive vice-president and director of application delivery strategies at Meta Group in San Jose, Calif., said EDS and NCR are well suited for a technology partnership.
“There are a good number of very large data warehouse projects taking off that are especially tied to customer relationship management,” he said.
“So now if you are going to build the pyramids or whatever complex project, you’ve got the technology people and the implementation people coming together.”
According to Zornes, the three-way service provided by the partnering makes sense, because it is very difficult to bring together data from across an enterprise — especially if it is a distributed company. It is beneficial in these cases to provide a complete business intelligence service, and small or regional consulting firms are often overwhelmed when they take on this responsibility.
“There’s this huge imperative to do better customer relationship management. Today, that’s mostly just words, because it’s a very difficult thing to do. It’s getting even harder and the pace is picking up because there are even more sources of data,” he said.
“Data warehousing has been good to companies, but has been primarily a batch process.” It is usually only updated at night or on weekends and only a handful of people in the company actually get access to the data, he explained. “Where we are now, the pace of business has picked up and people need to be able to respond to business campaigns faster — so they want to be able to update hourly, or in 15-minute increments,” Zornes said.
“But you can’t just let it happen, you have to architect it [in the form of an] information supply chain.”
The digital economy is changing the rules of the game from manufacturing push to consumer pull, said Doug Aldrich, vice-president of the strategic information technology practice at Chicago-based A.T. Kearney.
“The organization of the future that is going to survive in this area has got to be able to flexibly respond to these market drivers. These changes are going to be over weeks and months, not years and decades.”
The partnership will allow the vendors to bundle management and solutions consulting with technical delivery across the extended enterprise.
According to Aldrich, there is a hangover effect from ERP implementations and wide-spread Y2K solutions that have been going on in most large companies in the last couple of years.
“Numerous CEOs are coming to an awakening that having spent large sums of money, in many cases several hundreds of millions of dollars, on ERP-type solutions that their businesses are not running any better than they were before. They have no ability to tap into these systems and truly gain understanding beyond the fairly segmented departmental kind of natural information outflow that is always six week in arrears,” Aldrich said.
“The ERP (in these companies) was necessary — I’m not saying it was wasted. But it was not sufficient to get them proactively into the game of managing where they are going.”
Hartmut Burger, executive vice-president of Plano, Tex.-based EDS, said his company’s primary focus used to be on developing cheaper, more reliable and faster information — but that increasingly, more value has come from the information itself.
“This new selection of services will transform historical data warehouses into aggressive information arsenals from internal and external information that is readily available.”
Mark Hurd, senior vice-president of NCR Corp., in Dayton, Ohio, said the partnership gives NCR an opportunity to expand its Teradata technology to markets where it doesn’t necessarily have the specific industry experience to be successful alone.
“One of the most important aspects of understanding is not just technology. This is about changing — in many ways — the way you do business,” Hurd said.
The only potential drawback Meta’s Zornes sees of the partnership is EDS’ somewhat inflexible reputation in the industry.
“Perceptions are very important. [EDS] is not perceived as being nimble and quick to react,” he said. “So the question is: can they overcome this image of being stodgy and conservative?”