I’m Already a Customer: Disconnected Strategies and Data

Most of us do not mind receiving well-targeted and relevant marketing messages. Sometimes they can be helpful and perhaps educate us about a product, service or upgrade that is of interest. Conversely, we can be confused and perhaps a bit offended when an organization’s marketing misses the mark. How many times has the financial institution you have banked with for more than a decade sent you mail to entice you to open a checking account and receive a new credit card? Besides the obvious cost involved of mailing the materials, consider the wasted money spent trying to recruit you as a new customer when you are already a long-term patron. Such nonproductive sales and marketing efforts trigger questions, such as: “Why are you sending me solicitations to become a new customer when I already do business with you?” Disconnected and disparate customer databases can lead to such problems, but the larger issue to be addressed is that of disconnected business function silos.

In the article Integrating Business Unit Strategies Into a Synchronized Corporate Strategic Plan, the fusion of planning efforts between the corporate structure and business unit level were explored. What about the functional areas within a business unit? How can the different departments within a business unit be better integrated as well to avoid blunders like the credit card solicitation example cited above?

The truth is, businesses cannot afford to house disconnected silos. It is inefficient and creates costly overhead related to the infrastructure required to support walled-off functional processes and systems. Silos within an organization predispose it to many challenges, amongst them are:

–  Stifled communication between departments

–  A slowed rate of innovation

–  Initiative redundancy

–  Disconnected information systems

–  Turf wars

All of the above can further exacerbate overhead cost for a business. Worse yet, silos can harm the competitiveness of the business. Consider just one of the major assets every organization possesses, information. Data silos hamper organization’s efforts to fully capitalize on this valuable resource. Let’s examine just a few examples below:

–  CRM data used by Sales to support business development initiatives could also be serving marketing to roll out more effective loyalty programs.

–  Marketing departments house a wealth of information on buying trends, preferences and price sensitivity that could benefit product managers.

–  Sales could benefit through visibility into Accounting’s data by knowing which customers are paying on time, consistently underpaying or remitting late.

–  Information Technology can fuel innovation and add separation from competitors through enhanced service features to support application or customer-facing systems, but isn’t always allowed the opportunity to work closely with other functional areas of the business to develop such solutions.

Silos in business are naturally forming, and the answer to overcoming the challenges they present is not to impose a centralization model, but instead to take the approach of replacing the competition and isolation they tend to create with collaboration and communication between the silos.

Integrated Operational Planning (IOP)

Integrated Operational Planning (IOP) bridges functional silos within the business through the development of cohesive sub-plans, all branching from the overall corporate strategic plan. Through coordinated planning across functional areas of the business,  IOP drives function-level operational plans to be developed in an integrated fashion to map out efficient and intelligent usage of the corporate resources. These sub-plans are developed at the functional level and are interlinked with the rest of the organization by design and as a part of the process. Plans detail the departmental / functional goals and objectives, tactics and accountabilities in sufficient detail to be executed by the employees of that group while interrelating to the other functions of the business and the overall corporate strategy.

Master Data Management (MDM)

Master Data Management (MDM) is yet another approach to breaking silos. MDM forces a healthy amount of collaboration to take place related to the sharing and usage of business information across functional silos. MDM has the objective of providing an enterprise solution for collecting, aggregating, matching, consolidating, quality checking, persisting and distributing the organization’s business data. The intent is to ensure consistency and control in the ongoing maintenance and application use of this information, while ridding the business of duplicated or inconsistent data relied upon by functional departments.

Summary

Operational excellence hinges on cooperation and teamwork across the organization. It also is predicated on planning that leverages the pairings of functions to create a greater good. Collaborations between functions such as Marketing and IT can capitalize on master data for analytics to yield more sophisticated customer segmenting and effective treatment programs. Planning approaches like IOP help fuse critical bonds in disconnected organizations and information models like MDM provide the strong foundation of timely, accurate and shared corporate data that provides a holistic view of customers.

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