Author Lochan Narvekar, © 2017 Ref# PIM0003-R01
PIM: A Classic
Case Study
I have put
together this interesting scenario to underscore the PIM importance in any
industry. Nothing here is a new revelation, but merely depicts the right
orientation of technical and business component can generate great savings. I
highly recommend reading article “Pillars of MDM “Ref# MDM0001-R01” before
reading this article.
Our
hypothetical company is a High-Tech B2C company called MyTech Inc. with its
typically short product life cycle and high innovation curve. But I have kept the
problem generic enough so that it can apply to any industry.
Problem Statement: It starts with Finance V.P., George Holder, complaining that Customer Support and
one time recall related costs for this quarter were surprisingly high.
Problem Details: It has been noted by his team that
the customer support costs have been study but portion of those costs cannot be
brought down as a percentage of overall costs. In fact, this slice has been
steadily increasing over the last 4 quarters.
Support director, Andrew Whitefield, found out that
the major component of support cost was the fact that the support calls were
getting multiplied because the marketing product number on the product leads
support personnel to the wrong SKU material and this in turn means more time
spent in the call or in lot of cases, a
wasted call.
George knows
that they pay the support vendor $10/call and quick inspection of the number of
calls shows the spike in support calls after new product line was introduced
last fall. He recalled that there have been many revisions to this product
line. He also realized that this may also mean returned products as well as lost
customer, at worst!
Please read article “ROI
on PIM: How to build a Business Case Ref# PIM0004-R01” as an example of ROI
justification. Similar ideas can be applied to CDI and other MDM areas.
He contacted CIO, Mark Muller, and requested to
propose a solution to this problem. In his team meeting Mark brought the topic
up, when Biao Zheng, his Engineering
Systems Manager suggested that this problem is in integration between
Engineering System and Marketing System. He promised to get back with his proposal.
Analysis: After talking to his Business Analysts, Biao realized that
there is one-to-many relation between Engineering SKU and the marketing product
number.
There were
also many attributes that defined this relationship. Also, he realized that
there were many Change Requests that came in monthly for SKU and although most revised the SKU, few indeed changed the
SKU number, called Enhancement SKUs.
Changing the SKU should be a flow that needs Marketing involvement in changing
the corresponding Marketing Product Number, and was not treated that seriously.
Anyone could copy an existing SKU into a new Enhancement SKU and with that,
copy all the same Marketing attributes from previous SKU. He asked his team members to analyze some data
to backup his claim, and found out that this was indeed the case!
Solution: Biao realized that this was clearly a
Master
Data Management problem. Not only Enhancement
SKU, but also New SKU creation
from Engineering PM should take Marketing input.
He connected
the dots with other requirements in his plate such as tightening the attributes
control for Manufacturing attributes as well as support need for product
information. He decided to use this opportunity to implement a PIM Hub for Marketing
and Support area consolidation as a first phase.
Although
Engineering PLM system is the backbone for Product engineering data, for
various reasons given in article “What is PIM? Ref# PIM0001-R01” PIM
system was very desirable to Biao and his Business counterparts.
Specifically
for MyTech Inc., Biao realized that MDM opportunity was to
- Consolidate Marketing System into the Hub: Marketing
V.P. was only glad to see that finally they will have a uniform view of
the product and Marketing will be the starting point.
- Consolidate Support function into the Hub: Support
director, Andrew Whitefield wanted a formal system for long time. He also
wanted access to the Product 3600 data, so that he and his team
would not constantly need to send emails.
- Get some key Business Flows like NPI (New Product Introductions)
extended through common UI to the rest of the Enterprise.
- Very easily handle publish subscribe model that is
needed in agile organization. This was of great importance to MyTech Inc.,
because in the current architecture, changes made by Engineering were
unknown to Marketing and those made by Marketing were unknown to Support,
Logistics, DISTIs and other organizations down the supply chain.
- Perform Data Governance: Data Governance is a breeze
with PIM Hubs: Currently anyone could change the attributes. We will see
in detail how this was handled.
- Use the BPEL/SOA capabilities available in the
Enterprise: With competitors moving towards SOA oriented architectures for
leaner supply chain, MyTech Inc., had put sizable investment Enterprise
Integration Platform. Hubs complement the Enterprise Buses in terms of
good consolidation Hubs that use Buses to publish and collect data from
the Enterprise. Lot of vendors are building standard adapters to their Hub
and Bus products making it lot easier to plug these together.
- Use Endless Extensibility to get more internal
systems into the Hub*1 .
- Cleanse the data more automatically: There are great
data cleansing tools out there. Standard adapters are also available to
automate the data exchange between PIM Hubs and Adapters.
*1 It should be noted that bringing a
system into Hub is a careful study of criticality and complexity of the system.
Detailed
Solution
Here are the
MDM pillars from article “Pillars of MDM Ref# MDM0001-R01”.
Common MDM Concepts
Let’s see how
Biao and his team dealt with this in the implementation.
MDM
Systems and Integrations
Biao chose a
PIM hub solution approach with consolidation model.
Solution footprint:
- Marketing: Today, Marketing used a home
grown database employing 2 engineers, one for support of business flows,
and second for data merge and mange, such as collaterals from vendors,
data from Engineering etc. The whole Marketing Custom DB was merged into
the Hub. All the attributes will be populated and validated in the Hub
before the SKU is moved to Release
status for further systems.
One resource requirement is now
alleviated because the manual flows are now merged into the Hub and Integration
BUS. So now, you need only one resource to maintain the Hub freeing the resource
to help in other critical Marketing functions.
- Support did not have any formal application. Hence
when Biao suggested bringing in Support dimension into the Hub, they were
thrilled by the idea.
- Marketing Numbers will now be SKUs in their own Item
Category with reference relationship to Engineering FG SKUs. Having
separate Marketing SKU in the Hub provided for controlled Marketing
features to be implemented as Attributes in the Hub.
- Engineering FG Items were integrated into their own
catalog category. Here, Marketing and Support attribute were added to
them.
- Engineering: will continue
to use the current system, but they added another status between the Pre-release and Release statuses, called Preparation. This is where the
product would cut into the Hub. Same
statuses will be there in the Hub as well.
- Business also agreed to create few new sub-types of
Change Requests to focus on the problem areas such as “Hazard” as well as “Support”. This will help later in
metrics creation in isolating the problem.
- Also, they decided to create a change Order type
called “Enhancement SKU Change
Order” to control the Enhancement SKUs creation. This flow will go
through the PIM Hub where Marketing Role will need to provide the new
Marketing numbers as well as other marketing information.
- Integration: The current PLM system where
Engineering flows were mapped will be integrated through the Enterprise
Integration Platform to the new PIM Hub just like the current ERP
system where the manufacturing BOMs etc are sent. The Marketing attributes will not
be sent back in Engineering PLM System.
The
need for integration between current Custom Marketing and Custom Support
systems is removed. There is still
manual communication between Marketing and Packaging Vendor, collateral vendor.
Similarly, Support has manual communication with support vendors. Biao knows
that Hub provides the great opportunity to standardize the communication
through Web Services.
- The whole solution brings the clarity and traceability
to the Marketing and FG Item where by making Recall situations much easier
to deal with.
Please read article “ROI
on PIM: How to build a Business Case Ref# PIM0004-R01” as an example of ROI
justification. Similar ideas can be applied to CDI and other MDM areas.
Ownership
Marketing:
These attributes will be owned by 2 Roles, the Global Product Manager
will own most of the attributes. The other Marketing Analyst Role will be
needed for other Marketing flows that will take care of subordinate attributes
and related flows.
Engineering: This department has well structured roles. The
current Role “Engineering Project Leader” will still own the new flow.
Common
Definitions & Classifications
A logical
data model diagram was created to find out the Engineering attributes that go
to the Marketing and various other systems thereafter. The same exercise was
done for the Marketing attributes that flowed through to other systems
especially support etc.
A parallel
exercise was taken up to consolidate the names and eliminate any redundancy.
This was also
a great chance for Marketing and Support to lobby for key attribute additions.
Data
Cleansing
The primary
problem was that new Enhancement SKUs had no correct Marketing Numbers. This
was a huge cost issue as the Packaging etc had already gone out. Also, the SKUs
were already leaning towards end of Stable Demand Curve. So Marketing,
rightfully so, was skeptical of changing them now. But a decision was made to
flag these SKUs and that was the task given to Support department. A small
budget was allocated for this task.
Other missing
information on Enhancement as well as main SKUs was responsibility of Marketing
Department.
As stated in
article “Pillars
of MDM Ref# MDM0001-R01”, there is another aspect of data
cleanliness on on-going basis. To this end, the new business flow in the Hub is
supposed to check that no SKU can move to “Released” status unless all the
information has been validated and accountable Roles have approved the Work
flow.
The metrics
mentioned in a later section will be indication of data cleanliness.
Business
Process Change
As stated
above, business process was changed to incorporate the Enhancement SKU. This
was called “Enhancement SKU Change Order” process. It starts with Engineering
Manager Role in PLM system, but terminates in the Support notification.
Data
Governance
We have
already talked about who will own the critical data. It will mostly be Marketing
Global Product Manager, Carole Graham. She along with her team can see, but
only she can change the attribute. She can only change Marketing Product Number
before the SKU is released. After release she needs to create a Marketing
Change Order which will be routed the regional PMs or DISTIs, terminating in
notification to support function.
Any change to
other attributes in the hub will be published to related consumers, especially
Support, now that they have few key attributes in the standard hub system.
Metrics
and Reporting
We are
interested in 2 metrics.
One is the
number of Change Requests coming per month for “Hazard” and “Support”. Related
to this was Open CRs each month.
Second metric
was number of ESCOs (Enhancement SKU Change Order) opened and their statuses.
Biao’s team
worked with Business Intelligence team to get this data collected in the data
ware house against a SKU. Also, to build a simple report. This report will be
sent to steering committee decided at the start of the project along with other
stake holders such PMs.
Disclaimer: Although loosely based on
author’s experience, the case study is a work of fiction merely intended to
depict a typical PIM scenario in any industry. It is not a real customer
scenario where author may have worked or advised in the past. All the names are
fictional.
About the
Author: About the Author: Lochan started his career in R&D
architecting PLM/MDM software. Moved to Consulting in 2005, and has been
successfully consulting for many years in the PLM, PIM and MDM area. He can be
contacted Lochan@gmail.com.
This is copyrighted material; © 2017 Lochan Narvekar.