Building High-Quality and Complete Product Information Using Best Practices and Technology Investments to Optimize Product Value WHITE PAPER Prepared for: Copyright Ventana Research 2017 Do Not Redistribute Without Permission
Table of Contents A New Generation of PIM for Business... 3 Embracing Product Information Quality... 4 Managing Products as Assets... 5 The Right Technology Makes a Difference... 6 Gain Benefits from a Dedicated PIM... 8 About Ventana Research... 10 2 2018 Ventana Research
A New Generation of PIM for Business Product Information Management (PIM) is a set of business practices focused on managing product information so that it meets the overall needs of the entire organization, from the supply chain to commerce and customers. PIM is also a category of dedicated applications that support product processes as well as the departments that contribute to and use product information for their business needs. Our Next Generation of PIM benchmark research finds that only 16 percent of organizations fully trust their product information processes, which makes this issue an urgent business priority. Significant merger and acquisition (M&A) activity over the last decade has led to drastic changes in the software that supports product information processes. This M&A activity has resulted in an increasingly large portfolio of products that have become more data- and IT-focused, in many cases part of a larger master data management (MDM) group of products that reduce the focus on business and customer needs. At the same time, front-office and customer-facing systems have undergone a transformation of their own, resulting in new cloud-based applications that are much easier to adopt, deploy and use. Meanwhile, customers today expect product information that is comprehensive, easy to consume and interact with, and totally accurate. This means that the quality and completeness of product information is of paramount importance. Organizations realize this. Our PIM research finds that for two-thirds of organizations data quality improvement is a top issue motivating improvement. Organizations also realize that data governance processes are critical; our research finds that improving data quality is the second-most-frequently cited issue (46%) driving improvement in this area, with complaints about data quality voiced by more than two-thirds of organizations. This renewed focus on the quality of product information must encompass all relevant information assets, digital and analog, to ensure the organization is best able to represent its products. Furthermore, managing the quality of product information should fall to people on the business side rather than those in IT, as business management is responsible for placing product information in the market and thus needs the ability to manage and improve it. 3 2018 Ventana Research
This management and use of business applications has grown easier as software has been made more intelligent with technology innovations ranging from digital processes to machine learning; many now can offer insights to guide business users as they grapple with today s information management needs. But in that process vendor software offerings for PIM have shifted more towards IT and master data management, a positioning shortsightedness on the part of many vendors that have lost focus on the importance of addressing the business requirements that are central to managing product information. But overreliance on IT in turn generated a market reaction of its own: a new generation of PIM applications designed to be managed and used by business that include significant innovations in product processes to deliver more comprehensive and complete product information. Not only can these new systems be accessed and used by any business process or application, they do a better job of helping organizations focus on what customers want to see and learn about products. Embracing Product Information Quality Enforcing information quality standards makes information more consistent and powerful. However, this process is challenging because today product information is defined and held in a variety of applications and systems managed by different departments. Optimizing the quality of product information means rationalizing it, synchronizing it and making it available to address the various needs of the organization. Doing this well is important to organizations; as noted earlier, improving data quality is the top driver for two-thirds of organizations planning to change the management of product information. At the core of this process done well is a single curated master version of product information that is centrally managed by business. However, creating a single version of product information isn t easy; it is a top issue for more than half (52%) of organizations as they have incompatible data integration, data quality and data transformation tools. Nearly half (48%) say they are challenged by disparate forms of data and 43 percent say standardizing data is too hard. Even if the right technology is adopted and used to develop a single version of product information, more than one-third of organizations report they 4 2018 Ventana Research
still face the barrier of inadequate data governance policies, which can lead to data quality issues going forward. Product information should not only be clean: that is, with correct definitions and all associated content it should also be comprehensive, which requires that information be enriched using all relevant data sources transactional, informational and analytical. Comprehensiveness in information is a challenge, though, because in many cases individuals are left to determine additional attributes of product information and then ensure they are populated accurately and efficiently. Methodically improving the quality of product information requires that organizations commit to and follow a process and workflow for review and approval. Fortunately, new technological advances have made matching and distilling product information from internal and external sources easier. In addition, thirdparty product information sources such as GPC, UPC and others built around XMLbased structures are increasingly available to use internally or share with customers and the supply chain. However, technologically mediated access and sharing should be used carefully, with prompting and interaction so the businessperson responsible is aware of what s being done, engaged with the process and avoids manual tasks to manage it. Above all, methodically improving the quality of product information requires that organizations establish, commit to and follow a process and standard workflow for review and approval. As noted, a lack of governance processes is a key barrier to having and using a single version of product information. Consistent policies and workflows is the smartest approach to effective data governance across departments and business processes. The best way to do this is with a committee of business professionals whose jobs involve product information; they can best help address conflicts and issues and ensure high-quality information. Managing Products as Assets Just as products are assets to a corporation, so too is the information associated with those products. This means that investments and resources that increase the value of product information add to the company s worth and so should be a priority. Too often this is not the case. Organizations should take product information more seriously and ensure that all representation of products is of the highest quality. To establish a product-asset based approach, management needs to take the lead and ensure that responsibility for product information is owned by 5 2018 Ventana Research
and shared among those who create or procure products and those who market and sell it. This requires that all responsible parties agree on the processes and prioritizations that drive continuous improvement. Organizations should onboard products in the same way they would a customer or employee, ensuring that all assets and information align with the requirements and goals of the business. A defined process such as this for onboarding and maintaining product information across the organization starts the journey toward treating product information as a valuable resource. To optimize quality, organizations should embrace a product-lifecycle approach a process that defines, enriches and deploys product information. This, of course, requires a methodology to register which processes and applications use product information to enable managers to know where information needs to be shared. Organizations should be able to completely trust product information, whether in business-tobusiness (B2B) or business-tocustomer (B2C) interactions. Integration across the supply chain with suppliers, manufacturers and retailers is critical; our Next Generation of PIM research finds that for a majority (56%) of organizations this involves more than five sources. The research also finds that 78 percent of organizations are satisfied when all product data is shared across the supply chain while a meager 16 percent of those that share only some data are satisfied. Organizations should be able to completely trust product information, whether in business-to-business (B2B) or business-toconsumer (B2C) interactions. Unfortunately, fewer than a quarter of organizations have confidence in product information in these contexts. Electronic communication in particular requires high-quality and complete product information that all too often does not exist. Half of organizations that integrate PIM with electronic commerce say they are satisfied with their product information, while only 40 percent have some level of satisfaction and plan to integrate sometime in the future. Furthermore, more than half (58%) of organizations with a single product information source for electronic commerce are satisfied but only 14 percent of those without a single source are satisfied. The Right Technology Makes a Difference Organizations have not necessarily made the smartest choices in the technology they have used to manage product information and create consistent product records. Our research finds that the top barrier to having a single version of product information is too many incompatible tools, an issue cited by 52 percent 6 2018 Ventana Research
of organizations. The cause of this problem is apparent in our research, which finds that most organizations create and manage product records using manual tools or generic technology. Only about one-fourth (28%) use a dedicated PIM system or application. Worse, more than three-quarters of organizations still use spreadsheets heavily or moderately. Spreadsheets are personal productivity tools that are not designed for PIM and often create issues in the critical process of managing product information. Our Next Generation of PIM research finds that 75 percent of organizations that use spreadsheets heavily when creating and managing product information are not satisfied with the management, while 83 percent of those that use them sparingly are satisfied. Organizations have used spreadsheets to manage product listings and attributes, which does not enable them to have access to all types of information. Among spreadsheet users, almost half (42%) of organizations report they find major errors frequently or occasionally and half find minor errors. Organizations should jettison antiquated legacy approaches that do not provide a common central environment in which to manage product information. CRM, ERP and other systems that are designed for conducting transactions rather than defining and managing product information will not do the job, instead continuing to segment the information. In our view, technology to support PIM should be comprehensive and easy to integrate. Our research suggests other critical components should be sought as well capabilities that are described as important by more than half of organizations. First, product information should have support for the complete information life cycle, including creation, introduction, maintenance, delivery and discontinuation. Second, managing product information requires supporting attributes, categories, items, packaging and descriptive aspects of products. Technology should also support modeling, integration and profiling of underlying product data. Then the PIM product should enable enriching product information using a range of sources, external as well as internal. Finally, systems should support digital asset management, including images and videos, so these assets can be easily accessed, updated and shared. 7 2018 Ventana Research
It is crucial that every organization prioritize the efficient distribution of product information to all channels web, ecommerce, mobile, retail and more. One of the key purposes of PIM is to publish product information across multiple channels, and while more than half of organizations (55%) identified this as a top capability and nearly two-thirds said it is very important to integrate PIM and commerce, the research also indicates that far too often, integration with digital commerce is not the priority it should be. When evaluating PIM, organizations should take care to look for more than just functionality. Our Next Generation of PIM research finds that the most important evaluation criterion is usability, cited by 60 percent of organizations. Also, organizations should examine how digital innovations using algorithms and intelligence are expanding the potential of PIM and in turn the development and use of product information. Gain Benefits from a Dedicated PIM A dedicated PIM can deliver significant benefits to an organization. When developing a business case for investment, organizations should prioritize the benefits they most need today but should also consider future needs. Our research finds the top benefits of a dedicated PIM are eliminating errors and mistakes (74%), improving the customer experience (61%) and gaining a competitive advantage (58%). Each of these is an achievable goal that every organization should seek to realize. Embracing PIM should empower an entire organization to work together to manage and improve the quality of product information so that it is comprehensive and complete. This means prioritizing the value of PIM across all departments, particularly marketing, as it is the group with primary responsibility for product promotion. Also, commerce teams that are responsible for interacting directly with customers or across the supply chain benefit significantly from a shared approach to PIM. Finally, operations teams across the supply chain that interface with manufacturing and ERP processes can ensure that an initial product definition and related details are associated with the product master. 8 2018 Ventana Research
Organizations should not lose sight of what is probably the most essential benefit of PIM, which is improving the customer experience when accessing and interacting with product information. Doing this successfully requires organizations to consider what will entice customers to purchase and commit to answering all questions in the marketing or support of products. Examining methods to garner feedback from customers and ascertaining satisfaction levels will help organizations effectively prioritize improvements to the quality of product information. Managing product information well means prioritizing it as an asset that requires investment. Organizations that integrate it across ERP, CRM, commerce and the supply chain will be rewarded with more accurate, comprehensive and consistent information, fewer errors and more efficient processes, and improved customer satisfaction. 9 2018 Ventana Research
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