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Internal Data Alignment: Learning From Best Practices - GS1

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<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>:<br />

<strong>Learning</strong> <strong>From</strong> <strong>Best</strong> <strong>Practices</strong><br />

How to Improve Your Current Business<br />

and Prepare for Global <strong>Data</strong> Synchronisation<br />

Results of the <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> Survey


ACKNOWLEDGEMENTS<br />

Capgemini was able to conduct this study thanks to the full support and<br />

leadership of the Global Commerce Initiative (GCI). In particular, we would<br />

like to thank Nigel Bagley (Unilever), Jeremy Hollows (Carrefour) and<br />

Natascha Pottier (GCI Project Management Office) for their efforts.<br />

We also extend our thanks to all the retailers and manufacturers that provided<br />

their valuable input for this study.<br />

Special thanks also goes to the Capgemini team, led by Kees Jacobs,<br />

which included Frank Smeets, Rob van den Elzen, Ard Jan Vethman, Ron<br />

Johnson, Scott Merrill and Stephen Alvey.<br />

May 2004 © Copyright 2004, Capgemini/Global Commerce Initiative


INTERNAL DATA ALIGNMENT:<br />

LEARNING FROM BEST PRACTICES<br />

How to Improve Your Current Business and Prepare<br />

for Global <strong>Data</strong> Synchronisation<br />

CONTENTS<br />

Introduction: The Critical Role of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> in the Supply Chain 4<br />

Executive Summary 5<br />

General Background and Scope of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> Activities 8<br />

Companies Provide Dedicated Focus on <strong>Data</strong> <strong>Alignment</strong> 8<br />

<strong>Internal</strong> and External Triggers Drive <strong>Data</strong> <strong>Alignment</strong> Projects 9<br />

Funding Comes <strong>From</strong> Corporate and Operating Companies 12<br />

10 High-Level Sponsorship Is Critical 12<br />

Making the Business Case for <strong>Data</strong> <strong>Alignment</strong> 13<br />

Synergy Among Operating Companies Is the Preferred Approach 15<br />

15 Accuracy Objectives Defined 16<br />

“Getting <strong>Data</strong> Clean” and “Keeping <strong>Data</strong> Clean” 17<br />

Initial <strong>Data</strong> Cleansing: “Get Your <strong>Data</strong> Clean” 18<br />

Activities: Mapping, Checking and Aligning 18<br />

Dedicated Resources Help Avoid Bottlenecks 19<br />

Involved Departments: Ownership <strong>From</strong> the Business Side 20<br />

<strong>Data</strong> Cleansing Takes Time 21<br />

Structural <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>: “Keep Your <strong>Data</strong> Clean” 22<br />

Activities and Timing: <strong>Data</strong> <strong>Alignment</strong> Is a Work in Progress 22<br />

Impact on Processes Will Occur Across the Entire Business 23<br />

Impact on the Organisation: Centralisation Is Key 25<br />

Impact on Trading Partner Collaboration 27<br />

Impact on IT Platform 28<br />

Architecture 28<br />

Product Information Management (PIM) 29<br />

Workflow 30<br />

Corporate vs. Operating Company Solutions 31<br />

Impact on <strong>Data</strong> Standards 32<br />

<strong>Best</strong> <strong>Practices</strong> in Action: <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> Case Studies 33<br />

Manufacturer Case Example: SCA Hygiene 33<br />

Retailer Case Example: Delhaize 34<br />

Conclusion: How to Make <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> a Reality 35


INTRODUCTION<br />

The Critical Role of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> in the Supply Chain<br />

Accurate and consistent item data is the cornerstone<br />

for an efficient, collaborative supply chain. It affects<br />

every aspect of the business (including sales,<br />

buying/merchandising, supply chain and finance). If<br />

the data quality is poor, initiatives like Global <strong>Data</strong><br />

Synchronisation (GDS) and Electronic Product<br />

Code/Radio Frequency Identification (EPC/RFID) will<br />

not fully deliver the promised benefits. Many retailers<br />

and manufacturers today are faced with major issues<br />

regarding their internal data integrity. Apart from the<br />

fact that this creates business inefficiencies, the big<br />

danger is that all these collaborative initiatives will only<br />

lead to an acceleration of the problems resulting from<br />

poor data quality.<br />

About the <strong>Data</strong> <strong>Alignment</strong> Research<br />

To examine the state of data alignment in the retail and consumer<br />

products industry and identify best practices, the Global<br />

Commerce Initiative (GCI) and Capgemini surveyed a worldwide<br />

audience of retailers and manufacturers. The survey contained<br />

30 questions inquiring about the strategies, practices and learnings<br />

of these companies regarding <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>.<br />

The questionnaire resulted in strong response, both qualitative<br />

as well as quantitative. All of the participating companies are<br />

dealing with <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> activities. In a number of<br />

cases Capgemini conducted subsequent interviews.<br />

In total 39 companies provided feedback: 17 retailers and 22<br />

manufacturers. These companies represent a balance of geographical<br />

coverage:<br />

• 34% of responding companies (primarily manufacturers)<br />

have a truly global spread<br />

• 40% of companies have their origin and predominant base<br />

in Europe<br />

• 20% of companies have their origin and predominant base<br />

in North America<br />

• 3% of companies are based in Asia Pacific<br />

• 3% of companies are based in South America<br />

Responses were received from both corporate headquarters as<br />

well as local operating companies.<br />

The good news is that many retailers and manufacturers<br />

are addressing this issue. The learnings from these<br />

companies will be valuable for other retailers and<br />

manufacturers that are struggling with this issue or<br />

have yet to address it.<br />

Capgemini has studied and analysed a number of best<br />

practices in the area of data alignment. On the following<br />

pages, we present the findings of this work and<br />

provide practical takeaways for retailers and manufacturers.<br />

Retailers that provided input included (amongst others)<br />

Ajinomoto, Big Food Group, Carrefour, Coop Italia, CVS,<br />

Delhaize/Food Lion, The Home Depot, Hudson's Bay, METRO<br />

Group, Royal Ahold, Tesco and Wegmans.<br />

Participating manufacturers included (amongst others) Allied<br />

Domecq, Georgia-Pacific, Gillette, Groupe Danone, Heineken,<br />

Heinz, Johnson & Johnson, Kraft Foods, Masterfoods, Nestlé,<br />

Procter & Gamble, Reckitt Benckiser, Sara Lee, SCA Hygiene<br />

and Unilever.<br />

All responses were analysed anonymously.<br />

This <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> study is a follow-up to “The Case<br />

for Global Standards: Creating the Business Case for Global<br />

<strong>Data</strong> Synchronisation in Your Company” (October 2002) and<br />

“The Implementation Roadmap for Retailers and Manufacturers”<br />

(May 2003), which were developed and published by the Global<br />

Commerce Initiative and Capgemini. The business case report<br />

provides the background and business rationale for adopting<br />

global standards and Global <strong>Data</strong> Synchronisation and addresses<br />

the implications of implementation. The roadmap provides an<br />

implementation framework of activities, milestones and critical<br />

success factors. <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> is an important enabler<br />

in this roadmap. This current report provides a more detailed<br />

focus on this subject. The business case and data alignment<br />

reports are available online at www.capgemini.com/GCIcase<br />

and www.gci-net.org.<br />

4


EXECUTIVE SUMMARY<br />

Accuracy and consistency of product data are lacking at<br />

both retailers and manufacturers. In fact, our research<br />

found that more than half of the items in company systems<br />

contain incorrect data (for example, wrong values<br />

and duplicate or obsolete entries). <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong><br />

is about improving this situation, by having the<br />

product data across the various business systems consistent,<br />

complete, accurate and available in a timely<br />

manner.<br />

Three main factors have caused the current situation:<br />

• People: Ownership of data is unclear; business<br />

employees often do not take responsibility for it;<br />

and the people who do care about data quality<br />

don’t get rewarded for it.<br />

• Processes: Managing accurate and consistent<br />

product information has cross-functional impact<br />

(e.g., involving supply chain, buying/<br />

merchandising, sales/marketing), but there are no<br />

true cross-functional processes defined for this.<br />

Product information is mostly managed by means<br />

of fragmented processes.<br />

• Technology: Product information currently resides<br />

in various systems in different formats with<br />

different rules and standards, used by different<br />

parts of the organisation.<br />

This situation has a significant business impact on<br />

retailers and manufacturers. For example, it has caused<br />

a number of inefficiencies, like duplicative and manual<br />

re-entry of data. Considerable effort is needed to manually<br />

“clean” and align the data from various sources.<br />

This also causes incorrect orders and invoices (and the<br />

subsequent corrective actions) and long lead times for<br />

data recording. At the end, it has a negative impact on<br />

consumer satisfaction as well, due to problems such as<br />

out-of-stocks that directly stem from inaccurate data.<br />

In addition, this prevents adequate collaboration<br />

between retailers and manufacturers. Without <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>, for example, Global <strong>Data</strong><br />

Synchronisation (GDS) will definitely not improve<br />

business performance and will, in fact, magnify the<br />

negative impact of poor quality data. What’s more, collaborative<br />

initiatives such as those included in Efficient<br />

Consumer Response (ECR) and Collaborative Planning,<br />

Forecasting and Replenishment (CPFR) will not be economically<br />

deployable on a wide scale without the consistently<br />

accurate and available information that will<br />

result from an <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> program.<br />

Finally, the use of new enabling technology such as<br />

EPC-enabled RFID tags, which will provide previously<br />

unimagined visibility across the supply chain, simply<br />

will not bring their promised benefits unless they are<br />

built on a foundation of quality information.<br />

This is not just a manufacturer issue. Retailers and<br />

manufacturers alike are impacted by this industry<br />

problem. This is not just a manufacturer issue. Retailers<br />

depend on the accuracy of the data that is provided by<br />

their manufacturers. But in turn, these manufacturers<br />

depend on the retailer’s ability to embed this data consistently<br />

in their systems.<br />

A fair number of retailers and manufacturers have identified<br />

the need to address their <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong>. Most of these companies are still working<br />

on this. Their experiences provided some interesting<br />

takeaways for companies that are about to embark on<br />

this journey.<br />

An important finding was that nearly all companies<br />

have been able to achieve executive commitment and<br />

proactive involvement from the business side of their<br />

operations. This is definitely not something only for IT<br />

and data management; business departments such as<br />

supply chain, buying/merchandising and sales/marketing<br />

need to take ownership of this issue.<br />

5


Most companies defined a dedicated project for<br />

<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> as opposed to embedding this<br />

in another project like ERP implementation. The message<br />

is clear: Have a dedicated project focus and make<br />

dedicated business resources available.<br />

The research also examined the triggers that have led<br />

retailers and manufacturers to assign dedicated projects.<br />

Although a combination of internal and external<br />

factors play a role in these decisions, it is clear that<br />

external business needs, such as GDS, are a crucial<br />

driver for internal alignment activities.<br />

A Two-Step Approach to <strong>Data</strong> <strong>Alignment</strong><br />

<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> is a two-step process. First, it<br />

is about “getting data clean,” as an initial, one-time<br />

activity to clean up the current inaccuracies. Secondly,<br />

it is about “keeping data clean” – ensuring that the root<br />

causes of data inaccuracies are addressed in a permanent<br />

manner. It is clear that the only way forward is to<br />

conduct both steps.<br />

The retailers and manufacturers working on <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong> strongly believe that this will bring<br />

them tangible benefits. It is recommended that companies<br />

build a business case before starting, and define<br />

and track concrete KPIs (key performance indicators).<br />

Getting data clean is about mapping, checking and<br />

aligning data, which is a manual, labour-intensive<br />

effort. This will take most companies between six and<br />

12 months to accomplish.<br />

Keeping data clean is about aligning processes, organisation,<br />

standards, IT solutions and trading partner collaboration.<br />

This will take most companies at least two<br />

years to develop, implement and, most importantly,<br />

institutionalise these changes.<br />

It is important to acknowledge that <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> will impact nearly all business processes and<br />

the entire organisation. Adequate product information<br />

management processes, with clear roles and responsibilities,<br />

need to be defined. This issue is largely about<br />

people and their behaviour. Responsibility and ownership<br />

among business employees is critical. Performance<br />

measurements and reward structures need to be taken<br />

into account as well.<br />

Centralisation of data management activities is<br />

inevitable. Although basic responsibility for data quality<br />

lies with the business side, centralised coordination,<br />

guidance and support are essential to guarantee, control<br />

and maintain a consistent set of accurate data. The<br />

level of centralisation may be different per situation (for<br />

example, in some cases on a country level, and in other<br />

cases on a regional or even global level).<br />

Technology Plays a Key Role<br />

Of course, technology is a major enabler for <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>. Nearly all companies participating in<br />

the study indicated that data alignment will have a<br />

major impact on their current IT landscape. The most<br />

important technology aspects are about Product<br />

Information Management (PIM) solutions as a “single<br />

source of truth” and workflow to support the item<br />

management processes.<br />

A majority of companies have seen the need to implement<br />

a separate PIM solution. These solutions act as a<br />

“spider in the web,” containing the accurate and consistent<br />

set of master data, to be fed and used by the<br />

various functional business applications. This central<br />

catalogue also acts as a gateway for external data synchronisation<br />

(GDS). These solutions are tightly coupled<br />

with workflow support that seamlessly connects all<br />

functional business owners, guiding them in their data<br />

responsibilities.<br />

6


The retailers and manufacturers participating in the<br />

research indicated that successful implementation of<br />

data alignment requires an optimal mix of corporate as<br />

well as operating company-specific activities and solutions.<br />

Nearly half of all respondents have a corporate<br />

programme in place (or are in the process of doing so).<br />

While many companies indicate a desire to have a corporate<br />

solution rolled out across all operating companies,<br />

they note that this may take time to implement<br />

and they will therefore continue to work with some<br />

localised solutions.<br />

<strong>Internal</strong> data standards are the cornerstone of <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>, according to most retailers and manufacturers.<br />

Nearly all companies use the GCI-endorsed<br />

EAN•UCC standards as the basis for their internal<br />

standards. Most of them, however, still have work to<br />

do to reach 100% alignment.<br />

Making <strong>Data</strong> <strong>Alignment</strong> Happen<br />

Based on their experience, retailers and manufacturers<br />

offered a number of key recommendations to successfully<br />

implement <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>:<br />

• Establish executive sponsorship, business<br />

ownership and a mixed team of dedicated<br />

resources.<br />

• Start with “getting data clean” through mapping,<br />

checking and aligning.<br />

• Define the case and roadmap for setting up a<br />

structural improvement (“keeping data clean”),<br />

involving process changes and IT solutions.<br />

• Make it part of your trading partner collaboration,<br />

particularly in areas such as GDS.<br />

• Use GCI-endorsed EAN•UCC global standards as<br />

the basis for your own internal standards.<br />

7


GENERAL BACKGROUND AND SCOPE OF<br />

INTERNAL DATA ALIGNMENT ACTIVITIES<br />

Companies Provide Dedicated Focus on <strong>Data</strong> <strong>Alignment</strong><br />

A vast majority of retailers and manufacturers have defined data alignment activities with a dedicated focus. Only a<br />

small portion indicated that they take this up as part of another project (for example, an ERP implementation).<br />

Have you defined (a) dedicated project(s) to achieve <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> within your company?<br />

Part of projects<br />

14%<br />

13%<br />

Manufacturer<br />

Retailer<br />

Dedicated<br />

86%<br />

87%<br />

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “We defined one project oriented to external data<br />

alignment and more projects oriented to <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>.” (European retailer)<br />

• “There is an overarching plan for alignment at the<br />

corporate level. Below that, there are specific<br />

projects targeted to achieve internal alignment for<br />

Merchandising, Finance, Services, etc.” (North<br />

American retailer)<br />

Representative manufacturer response:<br />

• “This has been a two-step process. The first step<br />

delivered a structural change. Previously, we had a<br />

‘distributed services’ model (e.g., data management<br />

in each country/operating unit). We now have a<br />

‘shared services structure’ (e.g., single, global,<br />

centralised data management). Step two was the<br />

establishment of a global <strong>Data</strong> Quality<br />

Improvement Team. This team is made up of Sales,<br />

Product Supply, Customer Service and IT personnel.”<br />

(global manufacturer)<br />

8


What is <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>?<br />

In the context of this study we use the following<br />

definition of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>: <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> means that all master data regarding<br />

trade items in all business systems within your<br />

company (and across operating companies) is:<br />

<strong>Internal</strong> and External Triggers Drive <strong>Data</strong><br />

<strong>Alignment</strong> Projects<br />

So what has triggered these retailers and manufacturers<br />

to assign projects with such dedicated effort? A majority<br />

indicated that they are driven by both internal and<br />

external triggers, although most retailers reported that<br />

the projects were more likely to be triggered by internal<br />

factors.<br />

• Complete – all required values are<br />

electronically recorded<br />

• Consistent – no different attribute values in<br />

different business systems<br />

• Accurate – the right values at the right time<br />

• Available – the data can be deployed without<br />

manual interference<br />

• Time stamped – the validity timeframe of the<br />

data is clear<br />

Takeaway: Have a dedicated project<br />

focus on achieving <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong>.<br />

9


Takeaway: External business needs<br />

(e.g., GDS) are a critical driver for<br />

internal alignment activities.<br />

What were the main triggers for your data alignment activities (internal and/or external triggers)?<br />

Retailer<br />

<strong>Internal</strong><br />

External<br />

Both<br />

53% 47% 57%<br />

Manufacturer<br />

29%<br />

14%<br />

<strong>Internal</strong><br />

External<br />

Both<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “External trigger: get item data from suppliers more<br />

efficiently, timely and correctly. <strong>Internal</strong> trigger:<br />

deliver and share data about products, suppliers,<br />

agreements, assortments, promotions, purchases,<br />

sales both among company internal functions and<br />

among companies in the group.” (European<br />

retailer)<br />

• “The primary trigger was a realisation that the<br />

current data structures and the inconsistency of the<br />

data within those structures could not support the<br />

strategic direction in which the organisation was<br />

headed.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Need for harmonised business processes,<br />

standardised data structures, and to reduce the<br />

number of existing data catalogues (from many<br />

to one).” (global manufacturer)<br />

• “Global consolidation of our customers and<br />

suppliers. <strong>Internal</strong> pressure to improve our<br />

business processes, reduce duplication of effort<br />

and increase efficiency and thus shareholder<br />

value.” (global manufacturer)<br />

10


How Accurate Is the Current Product <strong>Data</strong>?<br />

To quantify the scope of the data quality problem, UK-based UDEX analysed all new products, both consumer units<br />

(eaches) and traded units (cases) processed by its UK Quality Assurance service during the months of November<br />

and December 2003. The analysis was restricted to a subset of 17 attributes that are part of the GCI-endorsed<br />

EAN•UCC Global <strong>Data</strong> Dictionary (GDD).<br />

The analysis found that half of the consumer units were incorrect and one-third of traded units were inaccurate.<br />

Nearly three-quarters of suppliers of consumer units had incorrect items and 57% of suppliers of traded units had<br />

errors.<br />

What percentage of the items are inaccurate?<br />

Consumer Units<br />

Traded Units<br />

Percentage of Incorrect Items 51% 34%<br />

Percentage of Suppliers with Incorrect Items 72% 57%<br />

Source: UDEX<br />

<strong>From</strong> all incorrect items a breakdown was made for the different attribute types where these inaccuracies occurred.<br />

Among consumer units, the greatest percentage of inaccuracies were found in the areas of “weight/volume actualon<br />

pack” and “product range.” Among traded units, inaccuracies were highest with regard to “pallet height” and<br />

“pallet gross weight.”<br />

Breakdown of inaccuracies by attribute type<br />

Consumer Units<br />

Traded Units<br />

Attribute Type<br />

%<br />

Attribute Type<br />

%<br />

Product Dimensions<br />

11%<br />

Product Dimensions<br />

18%<br />

Weight/Volume Actual - On Pack<br />

28%<br />

Product Gross Weight<br />

6%<br />

Number in Pack - Actual<br />

16%<br />

Pallet Configuration<br />

16%<br />

Product Range<br />

28%<br />

Pallet Height - mm<br />

27%<br />

Sub-Brand<br />

17%<br />

Pallet Gross Weight - kg<br />

31%<br />

Total<br />

100%<br />

No. of Consumer Units in Traded Unit<br />

2%<br />

Source: UDEX<br />

Total<br />

100%<br />

11


Takeaway: Have a mix<br />

of corporate, business<br />

and IT funding for data<br />

alignment activities.<br />

Where did the funds for <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> activities come from?<br />

Retailer<br />

28%<br />

36%<br />

IT<br />

Business<br />

Corporate<br />

Manufacturer<br />

27%<br />

30%<br />

IT<br />

Business<br />

Corporate<br />

36%<br />

43%<br />

Source: Capgemini<br />

Funding Comes <strong>From</strong> Corporate<br />

and Operating Companies<br />

Another interesting topic is the funding of activities:<br />

Who is/are the financial sponsor(s)? In most cases there<br />

is some kind of combination of corporate and operating<br />

company funding. Also, a common practice is to<br />

use both IT funding and business funding.<br />

Interestingly, the portion of business funding is larger<br />

at manufacturers – probably because the commercial<br />

business operation feels stronger external pressure from<br />

retail customers.<br />

Representative retailer responses:<br />

• “Funding by the Business-IT budgets and priorities<br />

are driven by business strategies and requirements.”<br />

(North American retailer)<br />

• “It started corporately but now resides in IT and<br />

business-to-business.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Mainly, the budget for these activities is managed<br />

by the IS/IT department, even if business functions<br />

did provide (and are providing) people to achieve<br />

the project goal.” (global manufacturer)<br />

• “Shared costs between Sales and IS.” (global<br />

manufacturer)<br />

High-Level Sponsorship Is Critical<br />

It is clear that in most cases these projects have highlevel<br />

executive sponsorship.<br />

Representative retailer responses:<br />

• “Co-sponsored by President, SVP Merchandising,<br />

CIO.” (North American retailer)<br />

• “CEO, VP of Global B2B.” (European retailer)<br />

• “Senior Vice Presidents of the various category<br />

management and supply chain areas.” (North<br />

American retailer)<br />

Representative manufacturer responses:<br />

• “Our worldwide CEO and the Executive Board.”<br />

(global manufacturer)<br />

• “IT and value chain and commercial at the highest<br />

levels of the organisation (CEO, CIO, etc.).” (global<br />

manufacturer)<br />

Takeaway: Make sure there is proactive<br />

board-level commitment behind<br />

<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> projects.<br />

12


Making the Business Case for <strong>Data</strong> <strong>Alignment</strong><br />

There is an interesting difference between retailers and manufacturers when it comes down to making a<br />

business case for structural <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>. A majority of manufacturers have made a business case analysis,<br />

but this is not true for most retailers.<br />

Did you make an upfront business case for <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>?<br />

Retailer<br />

Manufacturer<br />

Yes<br />

Yes<br />

7%<br />

50%<br />

43%<br />

No<br />

Not yet / planned<br />

12%<br />

24%<br />

65%<br />

No<br />

Not yet / planned<br />

Source: Capgemini<br />

Representative retailer response:<br />

• “No, our executives saw the value and initiated the<br />

project.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Our business case has been made globally.” (global<br />

manufacturer)<br />

• “We made a business case for data synchronisation<br />

in general and one of the criteria was quality and<br />

speed of data. For data alignment we used the case<br />

with a retail partner.” (global manufacturer)<br />

Takeaway: Build a business case<br />

before starting.<br />

13


Takeaway: <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> will bring tangible<br />

business benefits.<br />

The major benefit areas that were mentioned included a number of concrete business benefits (for example, savings<br />

in supply chain, sales, merchandising, etc.).<br />

Representative retailer responses:<br />

• “50% of the potential savings are in supply chain,<br />

30% in store operations and 10% in each<br />

merchandising and accounting.” (North American<br />

retailer)<br />

• “Shorter times to get data. Reduced manual and<br />

data entry activities. Reduced time to deliver data.<br />

Reduced number of exceptions vs. business rules.”<br />

(European retailer)<br />

• “Agility in the operational environment; consistent<br />

answers to business questions across applications.”<br />

(European retailer)<br />

• “We are moving to an exception-based, actionoriented<br />

view of data that is KPI driven with store<br />

metrics, vendor metrics, merchandise and<br />

merchandise movement, and customer metrics. So<br />

our KPI for data alignment is the value of the KPIs<br />

that come out of it.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Reduced costs of internal alignment, better<br />

management information, cost of staying in<br />

business – trading with external partners.” (global<br />

manufacturer)<br />

• “Correct products ordered and delivered on time at<br />

the correct price. Improved management decisions<br />

based on reliable and timely information. Reduction<br />

of non value-added administrative work. Efficiency<br />

and effectiveness of business processes thanks to<br />

better quality data. Leveraging our purchasing<br />

power thanks to standardised data.” (global<br />

manufacturer)<br />

• “Possibility of decreasing the number of external<br />

connections to data pools. Reporting capabilities at<br />

international level. Improvement of intercompany<br />

processes. Workload in data management. <strong>Data</strong><br />

accuracy.” (global manufacturer)<br />

14


Synergy Among Operating Companies Is the Preferred Approach<br />

Most companies indicated that they are looking for synergies among their operating companies around <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>.<br />

Synergistic approach of data alignment activities vs. separate activities/approaches per<br />

operating company<br />

Per operating<br />

company<br />

24%<br />

29%<br />

Manufacturer<br />

Retailer<br />

Synergistic<br />

76%<br />

71%<br />

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100 %<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “We have a synergistic approach for all our national<br />

and international distribution lines.” (European<br />

retailer)<br />

• “While there are some separate activities across the<br />

operating companies, overall it is a synergistic<br />

approach.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Synergistic approach defined globally,<br />

implemented through the regional support centres<br />

and markets.” (global manufacturer)<br />

• “We have aggressively focused on a synergistic<br />

approach by single sourcing data across product<br />

lines, operating companies, geographies and<br />

applications.” (global manufacturer)<br />

Takeaway: Take a synergistic<br />

approach to data alignment across<br />

your operating companies.<br />

15


Takeaway: Define your<br />

data quality objectives and<br />

measures.<br />

Accuracy Objectives Defined<br />

Many companies have defined (or are working on) quantitative measures regarding their data accuracy<br />

objectives. Manufacturers appear to be ahead of retailers in this respect, as demonstrated by the fact that<br />

they may be pushed to provide clean data to their retailer customers.<br />

Have you defined clear objectives (regarding completeness, consistency, accuracy and<br />

timely availability?)<br />

Yes<br />

47%<br />

67%<br />

No<br />

33%<br />

53%<br />

Manufacturer<br />

Retailer<br />

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “A supplier is complete if more than 95% of their<br />

data is in sync with us…we have other measures as<br />

well.” (North American retailer)<br />

• “All data is supplied electronically to our item<br />

management system. Attributes have consistent<br />

meaning throughout all systems. <strong>Data</strong> from the<br />

supplier should be accurate and is date/time<br />

stamped. Online review and approval is required at<br />

some points in the workflow process from point of<br />

introduction to final acceptance of product data”<br />

(North American retailer)<br />

Representative manufacturer responses:<br />

• “We have defined data quality objectives. Examples<br />

include: percentage of products within tolerance on<br />

weights and dimensions (accuracy), adherence to<br />

release dates (timeliness), adherence to global<br />

standards (consistency), number of critical supply<br />

chain incidents, etc. We are somewhat limited by<br />

our measurement systems so we have a variety of<br />

measures across our geographies. However, they all<br />

tend to be similar in nature.” (global manufacturer)<br />

• “We are still developing the objectives in this area.<br />

Trying to balance the theory of what we should do<br />

with the practicality of what we can do.” (global<br />

manufacturer)<br />

16


Takeaway: Focus on both “getting your<br />

data clean” as well as on “keeping your<br />

data clean.”<br />

“Getting <strong>Data</strong> Clean” and “Keeping <strong>Data</strong> Clean”<br />

There is a difference in approach between “initial data cleansing” (which is about getting a cleansed set of data)<br />

and more structural “<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>” (which is about assuring you can keep your data clean in the<br />

future). A majority of companies acknowledge this difference and indicate that they are/will be working on both.<br />

These two approaches are analysed in more detail in the following section of the report.<br />

Has your focus been on both “initial data cleaning activities” and “structural <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong><br />

improvements” (or only one of these)?<br />

Retailer<br />

15%<br />

<strong>Data</strong> cleaning<br />

<strong>Data</strong> alignment<br />

Both<br />

Manufacturer<br />

15%<br />

<strong>Data</strong> cleaning<br />

<strong>Data</strong> alignment<br />

Both<br />

15%<br />

85%<br />

70%<br />

Source: Capgemini<br />

Representative retailer response:<br />

• “Both on initial cleaning activities and <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong>.” (European retailer)<br />

Representative manufacturer responses:<br />

• “Both are handled. <strong>Data</strong> cleansing has an internal<br />

priority and procedures will be installed to keep<br />

data clean. Structural <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong><br />

today has different approaches per region.” (global<br />

manufacturer)<br />

• “It has been on both. There is no point in doing<br />

data cleansing if you do not put new processes in<br />

place to maintain it.” (global manufacturer)<br />

17


INITIAL DATA CLEANSING:<br />

“GET YOUR DATA CLEAN”<br />

Activities: Mapping, Checking and Aligning<br />

The activities that both retailers and manufacturers<br />

conducted to clean up their current set of product data<br />

were quite similar for the most part. Common activities<br />

include mapping of internal and external data conventions,<br />

checking of data records (obsolescence, duplication,<br />

correctness) and aligning of data in different systems.<br />

Representative retailer responses:<br />

• “As a retailer, we are cleaning our data supplier by<br />

supplier as they send us their data via UCCnet. We<br />

are currently working with approximately 200<br />

suppliers.” (North American retailer)<br />

• “Referring to stated business rules, build utilities to<br />

monitor and check data in the company<br />

information system; point out and list exceptions.<br />

Submit exceptions to business functions<br />

responsible for getting and managing information<br />

about each main business entity.” (European<br />

retailer)<br />

Representative manufacturer responses:<br />

• “Mapping to EAN•UCC GDD, to current<br />

retailer/data pool requirements, within ERP<br />

systems. Decide how to consistently handle<br />

physical hierarchies within ERPs. Standardise<br />

information required for intercompany processes.<br />

Some activities had been done in the past to<br />

standardise and clean sales information reported at<br />

international level.” (global manufacturer)<br />

• “<strong>Data</strong> cleansing initiative: all markets and<br />

businesses to cleanse their data in current systems<br />

in terms of obsolescence, duplication, completeness<br />

and correctness, for an agreed minimum scope, and<br />

to implement data management best practices to<br />

sustain data quality after cleansing.” (global<br />

manufacturer)<br />

• “We performed an initial assessment of where data<br />

is used and how important its accuracy is. We then<br />

prioritised the cleansing of data based on business<br />

importance.” (global manufacturer)<br />

Takeaway: <strong>Data</strong> cleansing is all about<br />

mapping and checking.<br />

18


Dedicated Resources Help Avoid Bottlenecks<br />

<strong>Data</strong> cleansing is obviously not an easy task and bottlenecks are likely to occur. The bottlenecks most often mentioned<br />

included the non-usage of standards, the inflexibility of current IT landscapes and the lack of required<br />

resources and time.<br />

Representative retailer responses:<br />

• “A lot of suppliers don’t use standards (GLN and<br />

GTIN).” (European retailer)<br />

• “The primary bottleneck is that more than 50% of<br />

the data we receive from our suppliers is errant.”<br />

(North American retailer)<br />

Representative manufacturer responses:<br />

• “Dimensions of traded items. Availability of local<br />

resources to actually measure the products and<br />

clean the files. Weight of historical processes,<br />

working more or less correctly in an internal, local<br />

environment. Variety of retailer/data pool<br />

requirements. Repalletising process.” (global<br />

manufacturer)<br />

• “Main difficulties are with products which are<br />

conditioned or managed differently according to<br />

sales channel (e.g., assorted boxes or single product<br />

boxes, different management of size/color, etc.).”<br />

(European retailer)<br />

• “The primary bottlenecks revolve around the<br />

ongoing support of legacy systems while<br />

implementing new systems. Tightly coupled to this<br />

are the inherent ‘keep doing it the way we always<br />

have’ thought processes.” (North American retailer)<br />

• “Interest in the business (initial ‘ownership’ issue,<br />

involvement of business resources), time, time,<br />

time and resources.” (global manufacturer)<br />

• “Lack of a ‘single version of the truth’ as a starting<br />

point, and the need to cleanse impacted up and<br />

downstream systems.” (global manufacturer)<br />

Takeaway: Assign the right resources with<br />

dedication to data cleansing.<br />

19


Takeaway: IT and data management are<br />

important facilitators, but business should<br />

take real ownership of data cleansing.<br />

Involved Departments: Ownership <strong>From</strong> the Business Side<br />

Primary involvement in data cleansing at most companies comes from data management (especially at retailers) and<br />

information systems (especially at manufacturers). On the business side, supply chain and sales and marketing are<br />

mostly involved.<br />

Who has been involved in data cleansing activities?<br />

Source: Capgemini<br />

90%<br />

80%<br />

70%<br />

60%<br />

50%<br />

40%<br />

30%<br />

20%<br />

10%<br />

0%<br />

83%<br />

<strong>Data</strong> management<br />

68% 68%<br />

33%<br />

Information systems<br />

R&D / Product development<br />

0%0%<br />

42%<br />

63%<br />

17%<br />

11%<br />

Supply chain<br />

Finance & accounting<br />

47%<br />

0% 5% 25%<br />

25%<br />

HRM<br />

Sales & marketing<br />

Buying<br />

17%<br />

0% 0%<br />

Merchandising<br />

0%<br />

32%<br />

Production<br />

0%0%<br />

Store<br />

Retailer<br />

Manufacturer<br />

Representative retailer responses:<br />

• “Primarily data alignment people but they draw on<br />

the experts in merchandising, distribution,<br />

accounting, etc., as necessary.” (North American<br />

retailer)<br />

• “Our purchase company, the buying and data<br />

management department.” (European retailer)<br />

Representative manufacturer responses:<br />

• “<strong>Data</strong> owners from multiple product lines, data<br />

managers, IT organisation and impacted<br />

downstream system users.” (global manufacturer)<br />

• “Mainly IS/IT people were involved for automatic<br />

tools development and management, for checking<br />

and coordination of user activities, but people from<br />

the business (i.e., customer service, HR, factories)<br />

have also been involved.” (European operating<br />

company of global manufacturer)<br />

• “We view data integrity as ultimately a commercial<br />

responsibility supported by resources from IS and<br />

supply. If it is not owned by the business you will<br />

never be able to sustain ongoing data integrity.<br />

Holding the local business responsible for their<br />

own data is absolutely fundamental to data<br />

integrity.” (global manufacturer)<br />

20


Takeaway: Expect initial data cleansing<br />

to take at least between six and<br />

12 months.<br />

<strong>Data</strong> Cleansing Takes Time<br />

Initial data cleansing takes considerable time and effort. Most companies are still in the process or do not yet know<br />

how long it will take. On average, most companies with experience indicated that it has taken them between six<br />

and 12 months.<br />

How long did it take you to clean up your data?<br />

70%<br />

67%<br />

60%<br />

50%<br />

40%<br />

30%<br />

38%<br />

Retailer<br />

Manufacturer<br />

20%<br />

10%<br />

0%<br />

13%<br />

19% 19% 19%<br />

0%<br />

< 6 months > 6 months <<br />

12 months<br />

7%<br />

> 12 months <<br />

24 months<br />

13%<br />

5%<br />

> 24 months Unknown /<br />

ongoing<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “Three years and counting…but as a retailer, we are<br />

at the mercy of our suppliers.” (North American<br />

retailer)<br />

• “Up to 30 days for each supplier.” (European<br />

retailer)<br />

Representative manufacturer responses:<br />

• “Approximately one year to date, still ongoing, and<br />

fully expect to identify additional requirements,<br />

especially as we aim to grow our GDS capabilities.”<br />

(global manufacturer)<br />

• “About one year of elapsed time for the first cleanup,<br />

performed by users already in charge without<br />

critical impact on current activities, with a<br />

minimum of technical support (four people parttime,<br />

about 30% six months = nearly 1.5 FTE).”<br />

(European operating company of global<br />

manufacturer)<br />

• “Half year for 480 SKUs and 40 attributes. We<br />

calculate with 1.5 hours per SKU.” (global<br />

manufacturer)<br />

21


Takeaway: Start now, since data<br />

alignment will probably take you at least<br />

two years.<br />

STRUCTURAL INTERNAL DATA ALIGNMENT:<br />

“KEEP YOUR DATA CLEAN”<br />

Activities and Timing: <strong>Data</strong> <strong>Alignment</strong> Is a Work in Progress<br />

Achieving structural data alignment encompasses a<br />

broad range of activities involving a variety of people,<br />

processes and technologies. The retailers and manufacturers<br />

in this study said they are addressing:<br />

• <strong>Data</strong> management processes<br />

• <strong>Data</strong> management organisation<br />

• <strong>Data</strong> management IT solutions<br />

• Collaboration with trading partners<br />

• Standardisation<br />

It is clear that for most companies this is still a work in<br />

progress. All of the respondents indicate that achieving<br />

structural data alignment takes much longer than “just”<br />

initially cleansing the data.<br />

Most companies indicate that they don’t know how<br />

long data alignment will actually take. Among the<br />

companies that say they do know, a majority expect<br />

that this will take about two years.<br />

How long does it take to achieve structural data alignment?<br />

50%<br />

40%<br />

35%<br />

45%<br />

41%<br />

30%<br />

20%<br />

18%<br />

18%<br />

27%<br />

Retailer<br />

Manufacturer<br />

10%<br />

9%<br />

6%<br />

0%<br />

0%<br />

0%<br />

1 year<br />

(or less)<br />

2 years 3 years Longer than<br />

3 years<br />

Not clear / TBD<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “The process goes in phases; it’s not yet completed.”<br />

(European retailer)<br />

• “Start early, overcommunicate – both internally and<br />

externally.” (North American retailer)<br />

Representative manufacturer responses:<br />

• “Don’t underestimate the amount of time and effort<br />

it takes to achieve a high level of data quality.”<br />

(global manufacturer)<br />

• “12 to 18 months before having one central<br />

catalogue solution.” (global manufacturer)<br />

22


Impact on Processes Will Occur Across the Entire Business<br />

There is consensus regarding the scope of business processes that need to be involved. All companies indicated<br />

that this cannot be handled just from an IT or data management perspective. Also, a vast majority of both retailers<br />

and manufacturers are planning and/or implementing changes in their business processes to improve their <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong>.<br />

Which business process areas are taken into account for your <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> activities?<br />

100%<br />

90%<br />

80%<br />

70%<br />

60%<br />

50%<br />

40%<br />

30%<br />

20%<br />

10%<br />

0%<br />

R&D / Product development<br />

31% 33% 94%<br />

86%<br />

Supply chain<br />

Finance & accounting<br />

75%<br />

71%<br />

31% 33% 95%<br />

HRM<br />

Sales & marketing<br />

69%<br />

Buying<br />

48%<br />

75%<br />

0% 0%48% 50%<br />

0%<br />

0%<br />

Merchandising<br />

Production<br />

Store<br />

Retailer<br />

Manufacturer<br />

Source: Capgemini<br />

23


Table: Have you planned to change these processes in order to improve your <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>?<br />

No (not yet)<br />

21%<br />

15%<br />

Manufacturer<br />

Retailer<br />

Yes<br />

79%<br />

85%<br />

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100 %<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “All business areas are impacted.” (European<br />

operating company of a global retailer)<br />

• “We will be changing our item maintenance process<br />

to keep our data aligned. We will also be changing<br />

and eliminating processes in each of the business<br />

areas. That’s the only way you’ll get your savings.”<br />

(North American retailer)<br />

Representative manufacturer responses:<br />

• “Our approach will be to fix processes first,<br />

wherever possible.” (global manufacturer)<br />

• “As an example: We set up new rules to notify sister<br />

companies of new additions/changes in intercompany<br />

products.” (global manufacturer)<br />

• “Start with a priority business process, for example,<br />

new product introduction.” (European retailer)<br />

Takeaway: Anticipate item managementrelated<br />

changes in a range of business<br />

process areas.<br />

24


Takeaway: Have your business organisation take ownership<br />

of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>. Executive commitment and<br />

operational business buy-in are crucial to achieving this.<br />

Impact on the Organisation: Centralisation is Key<br />

The impact on a range of business processes implies that an equivalent range of organisational departments needs<br />

to be involved. Buy-in from these departments is essential for success. There is, however, a difference of opinion<br />

when it comes to the extent to which current organisational roles and responsibilities will need to change.<br />

Did you plan for new organisational roles and responsibilities, performance measurement and/or<br />

reward structures?<br />

No<br />

39%<br />

58%<br />

Manufacturer<br />

Retailer<br />

Yes<br />

42%<br />

61%<br />

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%<br />

Source: Capgemini<br />

Representative retailer response:<br />

• “New organisational roles and responsibilities have<br />

been planned for. Performance measures and<br />

metrics have yet to be determined.” (North<br />

American retailer)<br />

Representative manufacturer responses:<br />

• “This is a project across the whole organisation.”<br />

(European operating company of a global<br />

manufacturer)<br />

• “<strong>Data</strong> ownership is being pushed down to its<br />

rightful owner (i.e., freight class code belongs to<br />

logistics). It no longer all resides within the data<br />

management organisation.” (global manufacturer)<br />

• “Don’t underestimate the natural resistance to<br />

change local processes.” (global manufacturer)<br />

25


Takeaway: Centralisation of activities is key.<br />

You have to define which level of<br />

centralisation fits best in your situation.<br />

An important organisational topic is the level of centralisation of activities. <strong>From</strong> the responses it becomes clear<br />

that most companies find some form of centralisation – on varying levels, though – an important prerequisite for<br />

<strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>. All retailers indicated that they have some kind of centralisation already in place.<br />

What level of centralisation do you have/do you envision?<br />

Retailer<br />

14%<br />

50%<br />

35%<br />

Centralised<br />

country/local<br />

Centralised<br />

global/regional<br />

Not specified<br />

Manufacturer<br />

25%<br />

38%<br />

38%<br />

Centralised<br />

country/local<br />

Centralised<br />

global/regional<br />

Not specified<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “A centralised function of item data management.<br />

<strong>From</strong> the internal data pool all other distribution<br />

lines will be provided with item data.” (European<br />

retailer)<br />

• “Actually most of the data alignment activities are<br />

centralised; we plan to improve centralisation.”<br />

(European retailer)<br />

Representative manufacturer responses:<br />

• “We will centralise the control of the global<br />

attributes and allocate clear processes for the<br />

maintenance of local attributes.” (global<br />

manufacturer)<br />

• “We have centralised our data management<br />

organisation so that it provides a stewardship role<br />

across all of the functions/processes. The<br />

stewardship work process generates an exception<br />

warning anytime an SKU is assigned (or not<br />

assigned) in violation of the EAN•UCC GTIN<br />

allocation rules. This senior management<br />

intervention process ensures we remain consistent.”<br />

(global manufacturer)<br />

• “At a market (country) level we have established a<br />

data management function, supported by Regional<br />

<strong>Data</strong> Quality Teams who manage the global<br />

attributes of our master data, including items. <strong>Data</strong><br />

is captured locally using workflows and checked for<br />

completeness and adherence to standards by the<br />

Regional <strong>Data</strong> Quality Management teams before<br />

being approved for use in the business.” (global<br />

manufacturer)<br />

26


Takeaway: <strong>Internal</strong> and external data alignment<br />

activities need to be linked.<br />

Impact on Trading Partner Collaboration<br />

For nearly all retailers and manufacturers, their <strong>Internal</strong><br />

<strong>Data</strong> <strong>Alignment</strong> was directly linked with (current<br />

and/or planned) external data synchronisation (in 91%<br />

of the cases).<br />

Representative retailer responses:<br />

• “External data synchronisation is a key to the data<br />

cleansing activities.” (North American retailer)<br />

• “They are linked, under a single leadership.”<br />

(European retailer)<br />

• “We now incorporate data accuracy on our supplier<br />

scorecard.” (European retailer)<br />

Representative manufacturer responses:<br />

• “The objective is to be 100% linked.” (global<br />

manufacturer)<br />

• “We have one part linked to the internal alignment<br />

of coding structures and data and one part linked<br />

to external data synchronisation.” (global<br />

manufacturer)<br />

Most manufacturers indicated that they receive<br />

feedback – in one way or another – from their retail<br />

customers regarding the data quality they provide. A<br />

majority of retailers and manufacturers stated that they<br />

take the requirement of their trading partner<br />

collaboration into account for their <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> activities (88% of the cases).<br />

Representative retailer responses:<br />

• “Scope was internal but with appreciation of<br />

external requirements.” (European retailer)<br />

• “The requirements for data synchronisation (i.e.,<br />

UCCnet, 2005 Sunrise) are vital components to the<br />

success of collaborative initiatives.” (North<br />

American retailer)<br />

Representative manufacturer responses:<br />

• “Retailer collaboration requirements (e.g., on data<br />

sync, vendor management and CPFR) provided the<br />

initial list of items and data elements syndicated.”<br />

(global manufacturer)<br />

• “Where we need to support business process<br />

initiatives (e.g., VMI), we define our data<br />

accordingly.” (global manufacturer)<br />

• “As the basis, we have taken the mandatory fields<br />

of GDD and the mandatory data requirements of<br />

global data pools/customers, e.g., Transora,<br />

WWRE.” (global manufacturer)<br />

Takeaway: Don’t forget – <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> is the basis for improved<br />

trading partner collaboration.<br />

27


Takeaway: Be prepared for significant changes in<br />

your IT landscape.<br />

Impact on IT Platform<br />

Architecture: <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> is heavily dependent on technology enablement. When asked about the<br />

impact on their overall IT platform and architecture, a majority of companies indicated that this has a<br />

significant impact.<br />

How big is the impact regarding your architecture/your overall IT platform?<br />

Retailer<br />

Manufacturer<br />

46%<br />

23%<br />

31%<br />

Low<br />

Moderate<br />

High<br />

47%<br />

35%<br />

18%<br />

Low<br />

Moderate<br />

High<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “We have totally redesigned our IT platform with<br />

data synchronisation in mind.” (North American<br />

retailer)<br />

• “The introduction of new technology tools and<br />

business processes could have an extended learning<br />

curve. These can be implemented to facilitate future<br />

growth and development; but, if implemented<br />

incorrectly could be a maintenance nightmare.”<br />

(North American retailer)<br />

Representative manufacturer responses:<br />

• “Phase I: built a global product database. Phase 2:<br />

all transaction and reporting systems utilise global<br />

product master data. Phase 3: source finished<br />

product specs from art and package design<br />

systems.” (global manufacturer)<br />

• “Big impact – many legacy systems simply cannot<br />

handle new formats and require translations until<br />

they are phased out.” (global manufacturer)<br />

28


Takeaway: Maintain a single source of data,<br />

integrated with all other systems.<br />

Product Information Management (PIM): Most companies are not planning to change their current set of business<br />

applications (e.g., ERP systems). Instead, most companies are focusing on separate item management solutions (socalled<br />

PIM), which will be integrated with these back-end business systems and act as a “spider in the web.”<br />

Do you (plan to) use a separate solution for Product Information Management (PIM)?<br />

Retailer<br />

30%<br />

40%<br />

No<br />

Under review<br />

PIM planned<br />

PIM ready<br />

Manufacturer<br />

19% 19%<br />

No<br />

Under review<br />

PIM planned<br />

PIM ready<br />

30%<br />

31% 31%<br />

18%<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “The master data management system is a major<br />

piece of our architecture, which has to feed all<br />

other systems.” (European retailer)<br />

• “We are developing an enterprise-wide data layer to<br />

decouple data from the business applications.”<br />

(European retailer)<br />

Representative manufacturer responses:<br />

• “All product/item data management will be<br />

performed in the Global Product Catalogue.”<br />

(global manufacturer)<br />

• “We plan to develop a separate global master file.”<br />

(global manufacturer)<br />

29


Takeaway: Workflow will be a crucial part of<br />

your IT solution.<br />

Workflow: <strong>From</strong> our research it became very clear that companies see a major workflow impact to support the<br />

item managagement processes.<br />

What is the impact regarding workflow?<br />

Retailer<br />

Manufacturer<br />

10%<br />

10%<br />

Required<br />

Not clear<br />

None<br />

18%<br />

Required<br />

Not clear<br />

None<br />

80% 82%<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “A comprehensive workflow is currently being<br />

developed to support the processes.” (North<br />

American retailer)<br />

• “Because data comes from various functions in the<br />

company, a workflow is a must to carry requests<br />

from functions (new product creation requests,<br />

modification requests, status change requests, etc.)<br />

as well as feedback from the central department<br />

(confirmation, rejection, etc.).” (European retailer)<br />

Representative manufacturer responses:<br />

• “Workflow will be a key enabler for new business<br />

processes and procedures that maintain data<br />

integrity.” (global manufacturer)<br />

• “Workflow is designed to minimise data entry<br />

effort, around the principle that master data is<br />

entered only once.” (global manufacturer)<br />

30


Takeaway: Go for an optimal mix of corporate<br />

vs. operating company-specific activities.<br />

Corporate vs. Operating Company Solutions: Most solutions and implementations have both corporate as well as<br />

operating company/country-specific aspects. Nearly half of all respondents have a corporate programme in place<br />

(or are in the process of doing so).<br />

Will you have operating company-specific solutions/implementations, or will this be a corporate solution/implementation<br />

(or a mix: operating company implementation facilitated by corporate)?<br />

Retailer<br />

Manufacturer<br />

11% 22%<br />

66%<br />

Operating<br />

companyspecific<br />

Corporate<br />

Mix<br />

36%<br />

21%<br />

43%<br />

Operating<br />

companyspecific<br />

Corporate<br />

Mix<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “Corporate repeatable solutions where appropriate.”<br />

(European retailer)<br />

• “This will be a corporate solution that will be rolled<br />

out to all operating companies in the future.”<br />

(North American retailer)<br />

Representative manufacturer responses:<br />

• “We will have a corporate solution, localised only<br />

where required to meet legal and/or fiscal<br />

requirements.” (global manufacturer)<br />

• “It will be a mix. One overall global master for<br />

some key attributes. Local systems and processes to<br />

support ongoing local ERP systems.” (global<br />

manufacturer).<br />

• “We manage GDS as follows: a local trading activity<br />

managed under a global strategy and platform.”<br />

(global manufacturer)<br />

31


Takeaway: Use GCI-endorsed EAN•UCC<br />

standards as the basis for your<br />

internal standards.<br />

Impact on <strong>Data</strong> Standards<br />

<strong>Internal</strong> data standards are the cornerstone of <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>, according to most retailers and<br />

manufacturers. Nearly all companies (91%) use the GCI-endorsed EAN•UCC standards as the basis for their<br />

internal standards. Most of them, however, are still working on this area.<br />

Do you currently (plan to) have a common set of corporate-level internal data standards?<br />

Retailer<br />

Manufacturer<br />

5%<br />

36%<br />

64%<br />

Yes<br />

Planned<br />

No<br />

29%<br />

67%<br />

Yes<br />

Planned<br />

No<br />

Source: Capgemini<br />

Representative retailer responses:<br />

• “We will follow the EAN•UCC standards.” (North<br />

American retailer).<br />

• “GCI-endorsed standards will be applied where<br />

appropriate when we make changes to our<br />

applications. We will not reengineer purely to align<br />

with GCI standards.” (European retailer)<br />

Representative manufacturer responses:<br />

• “We have a single data standard at corporate level.<br />

These standards were written corporately, are<br />

managed corporately but implemented locally.”<br />

(global manufacturer)<br />

• “We use GCI-endorsed standards for those that<br />

exist already, to be supplemented as new ones<br />

become approved. We will use internal standards<br />

only where absolutely necessary.” (global<br />

manufacturer)<br />

<strong>Data</strong> standards are in most cases (more than 90%) defined on both attribute names and definitions, as well as on<br />

attribute values.<br />

Representative retailer responses:<br />

• “We plan to state and apply standards at the<br />

attribute values level.” (European retailer)<br />

• “All data will be defined, at a minimum, at the<br />

attribute name/definition level, but there will be<br />

instances where normalised data values are defined<br />

as well.” (North American retailer)<br />

Representative manufacturer response:<br />

• “<strong>Data</strong> standards will be defined at the level of the<br />

allowed attribute values.” (global manufacturer)<br />

Takeaway: Define standards,<br />

wherever relevant, at the<br />

lowest level – attribute values.<br />

32


BEST PRACTICES IN ACTION:<br />

INTERNAL DATA ALIGNMENT CASE STUDIES<br />

The research makes it clear that many companies are actively engaged in <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> projects. To present<br />

an integral view of some of the best practices as applied in the real world, we have included the following case<br />

studies (one manufacturer and one retailer). The case studies were linked via a joint data synchronisation initiative.<br />

Additional examples of best practices exist in the industry.<br />

Manufacturer Case Example: SCA Hygiene<br />

The Challenge<br />

SCA Hygiene Products’ priorities were to reduce the<br />

cost of internal database maintenance and costs linked<br />

to the supply chain by improving the flow and quality<br />

of product information. SCA Hygiene Products was<br />

also responding to the call for better data at lower cost<br />

from its retailer partners. This placed a new emphasis<br />

on data quality within the organisation in order to successfully<br />

match retailer requirements in a centralised<br />

product database.<br />

Activities<br />

The first activity was to get all mandatory item data<br />

consistent across the organisation and aligned with the<br />

standards. This involved making a gap analysis on<br />

internal attributes, setting up activities to fill the gaps<br />

and adjust the business processes internally. One of the<br />

immediate benefits of this activity was that it sharply<br />

increased the understanding and awareness of the need<br />

for industry standards across the organisation.<br />

There is no doubt that <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> has a<br />

major impact on workflow within the organisation.<br />

Once data have been aligned, it is essential to put in<br />

place a framework and set of governance processes<br />

that manage change over time. This is a collective<br />

effort and involved people across IT, <strong>Data</strong><br />

Management, Sales and Marketing and Customer<br />

Development teams, plus external data alignment and<br />

harmonisation expertise (ACNielsen).<br />

Key <strong>Learning</strong><br />

The key learning for SCA Hygiene Products was that<br />

in order to achieve full <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong>, there<br />

first has to be external alignment work completed with<br />

trading partners. The knowledge gained from external<br />

alignment feeds the subsequent internal requirements.<br />

Benefits<br />

An immediate benefit of the internal alignment exercise<br />

was a better understanding of how to apply industry<br />

standards. Also a recognition that the standards are<br />

not complete, and that the new processes need to be<br />

able to manage changes to the standards as they<br />

evolve.<br />

While work is continuing on full internal alignment,<br />

SCA Hygiene Products has already identified the benefits<br />

of increased sales by getting products onto the<br />

shelf several days earlier than before. This is achieved<br />

by holding the right retailer requirements in internal<br />

systems and ensuring that data are aligned in advance<br />

with all parties in each target market.<br />

There is also an immediate benefit in the relationship<br />

between SCA Hygiene Products and its retail customers<br />

involved in external alignment. Participating in<br />

external data alignment as a first step to understanding<br />

internal needs gives both trading partners the opportunity<br />

to define shared goals and objectives.<br />

33


Retailer Case Example: Delhaize<br />

The Challenge<br />

For Delhaize, the challenge was to improve the quality<br />

of the product file and ensure that the quality<br />

improvements in the supply chain would have a positive<br />

impact on efficiency and profitability within the<br />

organisation.<br />

Among the challenges was the importance of addressing<br />

the business requirements in Europe, which<br />

included region-specific attributes such as the<br />

European Intrastat code; country-specific languages<br />

(French, Dutch, German and English are mandatory<br />

for Delhaize); and even some retailer-specific attributes.<br />

By focusing on external alignment (including alignment<br />

with other retailers) with supply chain partners,<br />

Delhaize planned to help suppliers to increase the pace<br />

of transitioning towards full data synchronisation. This<br />

should provide Delhaize with the benefits of fully<br />

aligned data that could be integrated into both existing<br />

business processes as well as creating a platform for<br />

future systems that will operate regionally or globally.<br />

Activities<br />

The initial focus was on establishing consistent mandatory<br />

attribute information, including a particular<br />

emphasis on Global Product Classification Standards,<br />

which Delhaize planned to align to internal<br />

category/data standards to provide an automated<br />

mechanism to route and manage information coming<br />

from suppliers.<br />

Critically, both to support the supplier and the<br />

Delhaize internal alignment review, the parties had to<br />

agree on external standards as the target that was common<br />

across all participating organisations.<br />

Key <strong>Learning</strong>s<br />

A key learning for Delhaize was that for a retailer, the<br />

issue of internal alignment is a “must have” to gain the<br />

full benefits of engaging suppliers in an effective data<br />

synchronisation process.<br />

Another critical learning was the importance of external<br />

alignment where all parties in the supply chain<br />

agreed to and implemented the essential information<br />

required for exchanging data. By investing valuable<br />

resources in a detailed study of attributes that all parties<br />

in the supply chain agreed to adhere to, Delhaize<br />

created a template that can be used to drive the internal<br />

alignment process both within their own and the<br />

suppliers’ organisations.<br />

Importantly, involvement has been required from<br />

across the organisation, including supply chain, buying<br />

and category management.<br />

An additional key learning was that business must<br />

drive standards, not the other way around.<br />

A final but important learning is: Start now. Cleaning<br />

up and centralising data takes time – but the more<br />

centralised, global and qualitative the data becomes,<br />

the more valuable it will be to suppliers.<br />

Benefits<br />

A direct benefit of this process for Delhaize has been to<br />

highlight to the organisation the implications and<br />

responsibilities when implementing standards, which<br />

in turn has allowed for a practical and phased project<br />

approach. This includes supporting suppliers to review<br />

their internal data against the external standards (by<br />

providing a clear external requirement) and ensuring<br />

that the internal Delhaize needs were identified and<br />

addressed in a systematic manner.<br />

Understanding the direct connection between internal<br />

and external data alignment has provided Delhaize<br />

with a solid platform on which to build a robust data<br />

synchronisation network with all suppliers in the<br />

short term.<br />

34


CONCLUSION: HOW TO MAKE INTERNAL<br />

DATA ALIGNMENT A REALITY<br />

The participating retailers and manufacturers in this<br />

data alignment study provided valuable learnings from<br />

which other companies can benefit. We asked them<br />

whether they have specific advice to take forward to<br />

peer companies that face the challenge of cleaning up<br />

and aligning their item data internally. Their recommendations<br />

ranged from the importance of planning,<br />

maintaining a single source of data and defining ownership<br />

of the data to investing in the data cleansing<br />

process. Following are some of their comments.<br />

Representative retailer responses:<br />

• “Manufacturers should take the time to get data<br />

corrected in their internal system before publishing<br />

out to the network. Too much time has been put<br />

into data quality and understanding what fields<br />

represent and stand for. Need better definition of<br />

attributes and their appropriate values.” (European<br />

retailer)<br />

• “Break the challenge up into small pieces focusing<br />

on the key operational data first as it drives the<br />

rest.” (North American retailer)<br />

• “Have a single central repository which feeds all<br />

other systems. Have a single central function<br />

responsible for managing critical shared data and<br />

ensuring consistency. Build a few tools to allow for<br />

a periodic data cleaning, especially to eliminate<br />

obsolete data. Build a direct link with suppliers to<br />

update supplier-provided data when possible.”<br />

(European retailer)<br />

Representative manufacturer responses:<br />

• “Plan and schedule activities. Wherever possible<br />

define data at atomic level. Ensure understanding<br />

of key influencers. Do not leave this until the last<br />

minute!” (global manufacturer)<br />

• “<strong>Data</strong> should not be addressed independently from<br />

processes; data must be owned by the business;<br />

strive to keep data on top of the priorities.” (global<br />

manufacturer)<br />

• “Create a cross-functional team to address issues.<br />

Maintain a single source of data. Define ownership<br />

of data – where it belongs in the business – to<br />

ensure its accuracy. Give access to the data to those<br />

who need to review it. Keep the process simple –<br />

communicate reasons and benefits.” (North<br />

American operating company of global<br />

manufacturer)<br />

• “Ensure you have a non-IT high-level sponsor.”<br />

(global manufacturer)<br />

• “We need to educate the executive level on the<br />

importance of data.” (global manufacturer)<br />

Most importantly, participating companies emphasised<br />

the need to obtain strong commitment to <strong>Internal</strong> <strong>Data</strong><br />

<strong>Alignment</strong> inside the organisation. Said one global<br />

manufacturer: “Build your case before starting, obtain<br />

proper funding and establish a full-time project team.”<br />

• “Our experience is you have a lot of work with the<br />

clean-up process but you must do it first.”<br />

(European retailer)<br />

35


About Capgemini and the Collaborative Business Experience<br />

Capgemini, one of the world’s foremost providers of Consulting, Technology and Outsourcing services, has a<br />

unique way of working with its clients, called the Collaborative Business Experience. Backed by over three decades<br />

of industry and service experience, the Collaborative Business Experience is designed to help our clients achieve<br />

better, faster, more sustainable results through seamless access to our network of world-leading technology<br />

partners and collaboration-focused methods and tools. Through commitment to mutual success and the<br />

achievement of tangible value, we help businesses implement growth strategies, leverage technology, and thrive<br />

through the power of collaboration. Capgemini employs approximately 55,000 people worldwide and reported<br />

2003 global revenues of 5.7 billion euros.<br />

Capgemini is helping numerous companies in the Consumer Products, Retail and Distribution (CPRD) industries<br />

gain the benefits of new enabling technologies such as Global <strong>Data</strong> Synchronisation, RFID, mobility and in-store<br />

customer interaction solutions. Capgemini’s Collaborative Business Experience makes CPRD companies stronger<br />

by combining what they do best with what we do best to improve performance. Thousands of practitioners with<br />

expertise in these industries help clients in more than 30 countries. To learn more, click on “industries” at<br />

www.capgemini.com.<br />

For more information on this <strong>Internal</strong> <strong>Data</strong> <strong>Alignment</strong> study please contact:<br />

Kees Jacobs<br />

Capgemini<br />

+31 30 689 7323<br />

kees.jacobs@capgemini.com<br />

Joseph Pavalon<br />

Capgemini<br />

+1 312 395 5428<br />

joseph.pavalon@capgemini.com<br />

About the Global Commerce Initiative (GCI)<br />

The Global Commerce Initiative was established in 1999 as a voluntary platform enabling the<br />

collaborative development of best practices and the implementation of global recommended<br />

standards.<br />

It is a network created by member companies and sponsors to simplify global commerce and link<br />

the value chains to improve consumer value.<br />

Its Executive Board comprises approximately 50 of the biggest manufacturers and retailers on a worldwide parity<br />

basis, and it is sponsored by eight organisations – regional ECR initiatives and VICS, four trade associations (AIM,<br />

CIES, GMA and FMI), and the standards bodies EAN International and UCC, Inc. – representing close to<br />

1 million companies in the world.<br />

For more information about the Global Commerce Initiative (GCI) please contact:<br />

Natascha Pottier<br />

Global Commerce Initiative<br />

+49 221 947 14 371<br />

natascha.pottier@gci-net.org


GCI_051004ES_Final_Report<br />

www.capgemini.com

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