Ongoing Q&As with IT and business leaders focused on best practices, thinking, and tips for data integration success
As Director of IT Consulting, Sam Wood leads strategic IT efforts for Bridgepoint, a professional services firm that provides strategic services and highly qualified professionals to solve complex financial, management and technology challenges. With over two decades in the industry, Wood’s experience includes a broad range of IT transformation initiatives, including IT planning, systems integration, and cyber security. At Bridgepoint, he has focused on helping executives and management teams reduce their business and operational risks, bridge resource gaps and improve overall performance. In the following discussion, Sam talks about how he and his team have used data integration to drive real business results that others may have missed.
Q: How important is data integration for your clients and the businesses that they serve, now and in the future?
A: It’s giant, as we all have data coming in from all different sources and places. The shift to cloud is exponentially adding to this. Both our team and clients are fully engaged in developing new strategies to utilize and integrate all these data sources, wherever they exist or come from. However, integration is only part of the equation. Executives need this information presented in a dashboard that is accurate and in a format that will help them make fact-based decisions. This is where integration is key, because it must handle data coming from different mainstream and homegrown systems, as well as different countries and devices. Once identified, we still have to put all of this data into a formidable method that can be used to help run the company. This is only going to grow in importance as technology and devices are integrated into more and more systems.
Director • Technology Consulting
“Good integration shows where your organization is weak. Knowing that, thinking about it and maybe even being on the lookout for these weaknesses enables you to use your integrations to identify and shore up your frailties.”
Q: Do you see a difference in the way you and your clients view integrating and onboarding data now versus in the past?
A: Data is becoming ubiquitous. And now, devices are delivering it directly without human intervention. For example, our oil and gas clients used to have to rely on truck drivers logging everything and later account for human error in either recording or inputting. It is much cleaner to directly onboard GPS tracking. Now, they think of their trucks as “rolling IP addresses.” This small change and the data it provides have improved the “velocity of cash.” Invoices could take over a month to deliver, but they’re now to the customer before the truck has left the terminal.
Q: What are the real, tangible benefits of doing data integration and onboarding right?
A: When integration is done right, and dashboards and KPI’s are in place, you can immediately see the weak spots in the company. This focuses the management team on the language of data and creates real metrics to run every part of the business. Before you get there, you need to make sure the data is correct before displaying anything. Anyone who says the data doesn’t need to be all that accurate and we just need a close approximation, is wrong. If you put out a number or metric, groups within the company will manage to it. Then, processes will follow to try to correct the numbers, greatly increasing the cost per transaction to the company. Additionally, if executives are used to managing without accurate data, their direct reports will demonize the reports rather than address problems.
We have found people and companies only really change when they are in some sort of pain that forces the transformation. That is why we always recommend completely mapping out the business processes prior to implementation. This gets you thinking beyond just gluing systems A and B together—like getting our invoices to connect to the businessXchange to improve our AR aging. Real benefits come from thinking strategically about how these same tools can be used to drive the company towards making fact-based decisions.
“Two key parts of any integration should include mapping out the business processes beforehand and performing a post-project audit to make sure you are getting the expected benefits. Without these steps, you will be at risk of solving issues with piecemeal solutions…”
Q: What are some of the challenges you and your clients see with data integrations?
A: Two key parts of any integration should include mapping out the business processes beforehand and performing a post-project audit to make sure you are getting the expected benefits. Without these steps, you will be at risk of solving issues with piecemeal solutions, while missing others. The effect becomes similar to squeezing a water balloon—issues may transfer and shift, but never go away.
Also, if we are dealing with any kind of application or mobile device data, it has to be shored up and as intuitive as possible. Otherwise, after the training, you’re going to leave town and people will revert back to the way they’ve always done it. This can dramatically slow down and decrease the accuracy of the data you’re expecting. You can perform flawless integrations all day long, but if your sources of data are not clean and double-checked, you will be left with inferior information.
Q: Any pleasant surprises during your integration projects?
A: Absolutely. Integration done right very often delivers beyond what the business expects. A good example is a medical device company that manufactured orthopedic, spine, and dental implants. They needed to get a clear picture of manufacturing and inventory turns, as their parts were built out of titanium and 65% of the total COGS was in the material and processing. Any excess inventory ate into their working capital, which they needed for growth. After this $19 million integration project was completed on a 10-year depreciation schedule, the company saved $18.5 million the first year alone and paid 250% bonuses.
Going back to the trucking example I mentioned earlier, the company found that integrating data from the trucks’ GPS systems showed how simple behaviors had a direct correlation to both safety and efficiency. Using the data from the project, the company discovered that drivers who skipped simple things could easily be identified and also tended to “cut corners” across a host of other safety and efficiency procedures. While the project was designed to speed up invoicing, the data integration helped to improve both safety and the overall business. This is just another case of having the ETL tools and processes needed to get the job done.
Q: What are the keys to getting these kinds of results with data integration?
A: You need to go in with the attitude that we’re going to change or improve by at least 10X. If you’re going to devote time and money to the issue, and go through the steps to remanufacture a process, you should be thinking in magnitudes, not increments. And don’t back off from that. Amazing things happen when you have the right tools, people, and management in place. In order for your IT department to be successful, they truly need to be helping you drive the business and must be at the same reporting level as their biggest customers like finance, logistics, marketing, etc. Integration projects are a great way to show the value of IT and give management a taste of success and the information your department can provide.
Q: What are some of the pitfalls managers and leaders should look out for with integration projects?
A: I’ve already talked about the importance of accurate data and having a thorough understanding of business processes, but there is an even bigger issue. Once you start delivering better information about the business, IT had better be ready for more requests from management. Demands for additional information across AR, AP, finance, manufacturing, fleet, supply chain—you name it—will come in succession if you deliver just once.
Another important point to keep in mind is don’t hesitate to ask for help before you start. Integrations are not something that everyone does every day. In a short amount of time, having someone with the right experience can save you a lot of heartburn and deliver the results you want fast.