Director's Quote in Profit Magazine 11/2002

Director's Quote
in Profit Magazine
Cached from Date: Nov, 2002



Information Overload

By Louise Fickel

Sinking under an ocean of data? Try these strategies.

If you're a ship's captain today, you can get better data sooner about the waters that lie ahead, but the seas remain the same finite entity Magellan faced in the sixteenth century. If you're an airline pilot, the same is true: Information about the skies in front of you comes in more quickly now—and more accurately—but Earth is still the same 24,000 miles in circumference it was when the Wright Brothers first took off at Kitty Hawk. But if you're a C-level executive and the vessel you're piloting is a global enterprise (or aspires to be one), the amount of data now before you seems to have conspired to become the Perfect Storm—a deluge of facts and figures that, if not properly managed, may be enough to sink the biggest of ships. The question for many executives is no longer, "How do I get the information I need?" but rather, "How do I make sense of it all, and where do I keep it, cost-effectively?"

Herding Cats

Regardless of where you are in a discussion that likely now includes terms such as "direct-attached storage devices" and "networked storage devices," you will probably return again and again to the topic of data management. "What's happening now," says Don Swatik, vice president of alliances and information sciences at Hopkins, Massachusetts-based EMC, the world's largest manufacturer of data storage devices, "is an evolution from an environment where you have one server connected directly to one unit of storage with very little management to a more-sophisticated environment of multiple servers from different vendors, heterogeneous operating systems, and multiple storage units from multiple vendors. Now you need to manage in three different spaces of server, network, and storage. So it becomes a question of how to simplify, automate, and make it open."


Storage management is at Oracle's core. With Oracle's new online data-reorganization capabilities, database administrators can move tables and indexes from one storage device to another without taking the database offline. Oracle Recovery Manager, meanwhile, handles backup and recovery for multiple databases. Learn more at Oracle AppsWorld.

Yet if you want to manage your data effectively, you must first design a storage architecture that ensures your data is consistent, accessible, and can be analyzed across the enterprise. Consider this: Many companies now store their customer information in multiple formats in isolated silos across the company. The call center, for example, defines John Smith as "Smith, J.," while the marketing department identifies him as "John Smith Jr." In this same scenario, rather than various departments dipping into the same pool of information, employees access different islands of data. The result is that everyone has a slightly different picture—and understanding—of the same customer. Not good for the customer. Not good for you.

To develop a coherent storage architecture, your management team must work together to first define your company's strategic goals and then determine the types of data needed to support that business strategy. "For many organizations, it's difficult to define the kinds of information you need to control the company," says Herman Verpalen, manager infrastructure architecture and management information at the Netherlands division of pharmaceutical giant GlaxoSmithKline. "The real issue is to help the management team discover its own business and ensure that you have the correct business linkages."

Once you have a clear understanding of the business, then you can determine who needs access to which kinds of data and how the data should be linked. The next step: implement storage-management tools from vendors such as EMC, Hewlett-Packard, Hitachi Data Systems, Legato, Network Appliance, Sun Microsystems, or Veritas to automate and streamline tasks such as switching storage from one machine to another when capacity starts to run low on the first one.

Up Close and Personal

But how does all of this play out in the real world? By mapping out comprehensive strategies for storing and managing their data, three Oracle customers are now using their data to develop stronger customer relationships, respond more quickly to changes in the marketplace, and run their businesses more strategically.

GlaxoSmithKline, which sells nearly US$30 billion worth of prescribed and over-the-counter medications annually, keeps its finger on the pulse of markets in 150 countries worldwide by running a network of astute local sales and marketing organizations. At the heart of GlaxoSmithKline's data challenge: Products are distributed through doctors and hospitals rather than directly to patients, so making sense of sales data is difficult.


Two-thirds of IT professionals said storage issues are now discussed strategically within their companies. More than half mentioned that senior management now pays more attention to the topic. Top four reasons cited for a growing demand for storage: business continuity, ERP, CRM, and internet applications.
Source: Lorraine Cosgrove Ware, CIO magazine

In the Netherlands, GlaxoSmithKline employees track local market conditions and assess the effectiveness of their own marketing strategies by analyzing huge volumes of sales data on the company's own products and those of competitors. A centralized Oracle data warehouse—which is expected to grow by 6 million rows per month—consolidates, stores, and analyzes point-of-sale data gathered from numerous sources, and the center's staff of 500 accesses the data via four online data marts. "We made all our data open and available to everyone because we wanted to ensure transparency across the organization," says GlaxoSmithKline's Verpalen. "We have data objects that can limit access, but that's never been necessary. Within the next year, we plan to include other information, such as cost and action data, and add more business intelligence so we can track return on investment (ROI) more effectively."

Flexibility was crucial in developing the IT architecture. "We needed the flexibility to respond to business changes, especially in light of last year's merger between GlaxoWellcome and SmithKlineBeecham," says Verpalen. "Because of Oracle's performance, reliability, and strong analytical capabilities, extraction, transformation, and loading processing of our data warehouse is fast, efficient, and easy to manage. Although a lot of data warehouses aren't very flexible, we have a fast, manageable architecture. With Oracle and other components of the architecture such as mnidex and BusinessObjects, we can remodel quickly and adapt to business changes within days."

By all accounts, the Dutch organization is already off to a good start. "Based on what we're seeing in the marketplace via the data warehouse, our executives have decided to reorganize the entire operation so we are more closely aligned with our parent company's strategic goals," Verpalen adds.

The Reality of Retail

And what about retail organizations whose annual revenues are typically generated within an absurdly short period of time? Nokian Tyres, a tire manufacturer and retailer based in Finland, knows all about small windows of opportunity. The company, which specializes in winter tires for cars and vans, sells most of its product during the first three weeks of November. Yet throughout the year, the company produces 5 million tires and must be able to track about 1 million units of inventory on any given day of the year.

Nokian uses Oracle for its data warehouse and its enterprise resource planning (ERP) system to support the retail and manufacturing sides of the business. "Our data warehouse is a consolidation environment that supports high-level business decisions," says Raimo Mansikkaoja, vice president of IT at Nokian. "We consolidated all our logistics and sales-reporting data last year so we could manage it more easily and track inventory more effectively." People throughout Nokian—from executives and the sales force to manufacturing and R&D—can access data according to job description. As at GlaxoSmithKline, backups are completed automatically with software. And everything is done on a tight budget: 16 people and an annual IT budget of about US$5 million.

Nokian has managed its technology creatively. "The role of our data warehouse has grown significantly over the past year," says Mansikkaoja. "We have taken nearly everything away from the operational environment so we can meet our data requirements more easily, faster, and at a lower cost. Because we've been able to eliminate most of the reports produced directly from our ERP environment, our end users who are waiting for those reports now get better service. They use Oracle Discoverer on their PCs to access the data warehouse directly. "From a management point of view, we can now support our decision-making more effectively," he adds. "For example, we can combine bill-of-materials data with order-stock and manufacturing data instantly. That solution is also good from an IT point of view, because we reduce the ERP load. In turn, we have been able to dedicate more capacity for transactional processing and reporting during the high season. Oracle has helped us see our business processes more clearly and develop them in a different way so we can run the business more efficiently."

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Outsourcing also plays an important role in Nokian's strategy. "We outsourced our Microsoft Windows NT servers and workstations to concentrate on our core business," says Mansikkaoja. "We know our ERP system and data warehouse well, so we are managing those systems ourselves. Someday, I expect, we will entrust our mission-critical applications to service providers. But before we do that, we want to make sure those experts are available to us 24 hours a day, especially during high season."

Future Concerns

The question of data storage and management will undoubtedly continue to come up. "You can't sit back and wish that the world were 'vanilla' and hope the complexity will go away," says EMC's Swatik. "The biggest mistake a company can make is to implement an infrastructure that doesn't scale into a more complicated environment down the road. As databases continue to increase by 50 to 100 percent each year and management problems grow geometrically, the only way to solve the problem is by networking the information and using sophisticated, automated management so that, in the future, one person can manage 10 times the amount of data they can manage today."

Louise Fickel writes about technology and business for industry publications such as CIO. Based near Washington, D.C., she can be reached at

Drowning in Data?
Strategies for Keeping Afloat

How can you begin thinking strategically about data storage and management? Experts point to a variety of business and technology issues to consider:

Consolidate Consolidating your data offers several distinct advantages: You can keep it more secure in terms of access and disaster recovery. Management is easier and more cost-effective. Centralized, networked data also facilitates the flow of information. "In the application space, data in one database is typically dependent on data in multiple databases," says Don Swatik, vice president of alliances and information sciences at data-storage manufacturer EMC. "If you need the ability to share information across applications, networked storage ensures better performance because the data doesn't have to go through the local-area network (LAN) first."

Segregate Determine who should have access to what data depending on the particular business issues that define your company. However, some general business rules apply across industries. Ask how you want to use the information. Keep in mind not only your business drivers but also the size and dimension of your business and how the data will be integrated with core systems. Define the logical and physical model of your data warehouse with your customers in mind if you want to distribute your customer information across the company, for example.

Scale Capacity and scalability are also key issues. "Companies should look at the amount of data they expect to have, the number of users, and the response time their users can tolerate," says Cyrus Shahabi, assistant professor of computer science at the University of Southern California (USC) in Los Angeles. "With those performance metrics, they should ensure their system can handle the throughput and desired latency time." If you're not familiar with determining this kind of information, talk with someone on your IT staff. Even if staff members don't know exactly how much data your sales organization creates every month, they can at least generate histories to provide a springboard for discussion.

Cost Cost of administration is also important. For example, finding even one person who can administer a heterogeneous environment is sometimes difficult—and expensive. If total cost of ownership isn't considered, your project won't be successful.

Technology You'll also want to spend some time understanding the nuances of specific technologies. For example, direct-access storage devices—first-generation storage products that connect directly to servers via network interface cards—may be more useful for storage and management of data on Web and file servers. "They modify the operating system and throw away most processes not required for data management to improve the data-intensive processes, so they're very efficient in pumping input and output," explains USC's Shahabi. "They are not good, however, for database applications, because databases do lots of optimizations that aren't compatible with the OS optimizations of network-attached storage devices. So storage-area networks are better for databases."

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