InformationWeek
Defining The Business Value Of Technology
September 20, 1999
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E-commerce and customer-relationship management have given a new urgency to compiling clean, consolidated customer information
By Bob Wallace
Ask Jim Noble, director of IS strategic planning at General Motors Corp., which is neck-deep in theprocess of pulling together thousands of customer databases from several business units to improve customer data quality. "It's a wonderful business concept," says Noble. "But it's one hell of an IT headache."
Despite the pain, more and more companies are putting customer data quality near the top of their IT to-do lists. That's according to the most recent quarterly Priorities survey by InformationWeek Research, which gauged the technology and spending plans of 300 IT executives.
In all, 81% of survey respondents ranked improving customer data quality the most important post-year 2000 technology priority, edging customer-relationship management (80%), high-availability net- works (78%), boosting networking bandwidth (72%), and E-commerce transactions (70%). When asked where they plan to significantly increase spending in the next 12 months, survey respondents put data quality second only to improving business processes.
Spending: Four of five IT executives are bullish about their companies' revenue prospects in the next 12 months. Despite entering the Y2K endgame, businesses are generally aggressive in terms of future IT spending.
In addition to spending on customer data quality, IT organizations plan to increase spending in several key areas. Improving business processes topped the list (84%), while about two-thirds of the 300 sites will spend significantly on Web customer support and E-commerce applications. More than half plan to significantly increase spending on the transformation of their traditional business models.
Change: A faster pace of change in their industries is spurring more frequent IT project reassessments at three out of four sites. An expanding list of project priorities and management demands is also a key driver.
Staffing: While 56% of respondents say their job vacancy rate is unchanged from last year, midsize companies are bearing the brunt of the labor shortage: 29% complain that their job vacancy rate is higher than it was last year (see story, p. 58).
Model Makeover
GM pushed ahead with the data warehousing project a year ago, even though it was in the middle of a $300 million Y2K remediation effort. "It's understood that this project is key to our future," Noble says. He wouldn't say how much the data project costs, but one source has tabbed the price tag at roughly $50 million.
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n IT, you sweat the details. That's certainly true when it comes to ensuring the quality of customer information. No small job, it's one of those traditionally behind-the-scenes efforts that involves a great deal of sweat but very little glory. 
The survey also revealed the following:
The world's largest automaker is putting its customer-data-quality project at the top of its list. GM is in the final stages of building a 10-terabyte online central data repository, scheduled to go live this fall. It's designed to help GM transition its business model from a traditional "make-and-sell" one to a "sense-and-respond" strategy that acknowledges the primacy of the customer, Noble says. Improving the information it receives and stores about customers will make the goal possible. 
continued...page 2, 3, 4
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