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Ventana Research defines product information management (PIM) as the practice of using information, applications and other technology to effectively support product-related processes across the customer, commerce and supply chain. As organizations increase the number and diversity of products and services they offer to customers and partners, they increasingly need to address limitations in the ways they manage and distribute product information, including related attributes and content that describes the products. At the same time, competitive pressures require them to be able to incorporate large amounts of new content – video and images, for example – quickly while ensuring that the information presented to customers is accurate, operational processes run uninterrupted and timely data is available for business analysis. In an environment in which consumers, suppliers and partners use multiple channels to get to product information – including websites, kiosks, smartphones and tablets – it is essential that the organization always be able to present complete and up-to-date product information to inspire interest and facilitate purchases.
Product information management and the applications and technology that enable it are designed to help businesses provide the best possible product information to their departments and partners. To accomplish this, PIM software must support multiple business roles, from product managers and marketers to operations and manufacturing teams and to suppliers and those in the supply chain. Manufacturers, for example, need to share product information with distributors and with direct retailers or digital commerce providers on the Internet. For finance and operations departments, effective use of product information increases the efficiency of business processes and reduces the risk of using improper information that could reduce profitability and degrade the customer experience.
Effectively managed information about products is also essential to support a range of decision-making about products and services. Analytics applied to product information can yield a variety of metrics; they can indicate where product information is missing, where it needs to be improved, patterns of product usage and the meaning of feedback about them. In the preparation of product information, analytics can help profile and improve the quality of data and associated attributes to reveal where action must be taken.
Product information management is not the same as master data management (MDM), although the two sometimes are confused. This misunderstanding can distract businesses from focusing on what they need in a PIM application. MDM technology can ensure a single definition of data across the enterprise and improve the quality and integration of data across information systems. Many PIM systems have built-in MDM and now data integration and data quality processes to ensure there is only one defined master record for any given product.
It is important to realize that product information encompasses more than just the defined name and attributes of a product in a database; it includes all related information needed for reference or compliance purposes. Organizations should take care to understand the differences between PIM and MDM as well as how they can complement each other to inform decisions. PIM is essential to enable business units to manage their product-related processes themselves just as IT staff need MDM and integration tools to enable them to manage data throughout the enterprise.
ERP and supply chain applications including product life-cycle management (PLM) have fallen short in meeting the requirements for PIM, leaving many organizations with a lack of consistency in mastering and publishing product information both inside the enterprise and across the supply and demand chain. Commerce software also has lacked depth in providing PIM, a core ingredient for transacting business in products and services. Many commerce providers talk about the importance of focusing on the customer experience, for which effective PIM is a necessity. Web content management software also has a role, but its design is focused on dynamically generating content from a database and personalizing it for business. The lack of maturity in these software categories creates a role for PIM software that can interoperate across business processes and applications.
The goal of PIM is to establish a reliable single source of product information that can be shared across channels. Getting it right is not easy; our benchmark research shows that more than one-quarter of organizations have more than 10 sources of product information that they must integrate and manage efficiently. Half of participants in our research acknowledged that standardizing product information requires substantial effort, and only 27 percent said they completely trust their product information.
In their efforts to produce a reliable product record, most organizations use laborious, time-consuming methods: 37 percent develop custom code, and 45 percent rely on manual effort. One-third of all participants still depend heavily on spreadsheets to create their product records, and almost half (46%) depend on them somewhat. And nearly all (94%) spreadsheet users find major or minor errors in their records.
Processes and tools are available that can automate much of this work. If properly deployed, PIM systems can synchronize all attributes and definitions used in the identification, description, sales and fulfillment of products across all channels that customers, suppliers, trading partners and employees use. Some businesses are implementing PIM that has master data management embedded within it while others connect PIM to their IT organization’s MDM, which can help improve the consistency and quality of data across the enterprise. PIM and MDM projects typically incorporate tools for data discovery, profiling and quality verification to deepen understanding of the data, including relationships and associations among items. This knowledge can be essential for integrating content and data from multiple sources and defining master data.
MDM software by itself and without a PIM context is just for the data infrastructure; this in recent years has slowed its adoption as what is commonly called big data complicates data transformation and creates challenges in adapting to business applications. MDM vendors that continue to insist that their products address PIM often find the decline of interest challenging their market relevance. In contrast, independent vendors focused on PIM have enjoyed a growing market presence in recent years. But just focusing on PIM has its own challenges as organizations look for simpler and more interconnected systems that utilize cloud computing and software as a service; many of these vendors have not moved rapidly enough to support these changes.
The benefits of using dedicated PIM technology can be significant. More than 40 percent of organizations said it can help eliminate data errors, improve cross-sell and up-sell opportunities and improve the customer experience through consistent product information. Yet our research indicates that most organizations have not adopted more capable systems: Only 27 percent use commercial software dedicated to PIM, although more than half (57%) said they will change their PIM system within 12 to 18 months. The latter finding in particular underscores the importance of having a reliable guide such as our 2015 Value Index for PIM which can help companies assess and evaluate vendors and products in this software category. I summarize our analysis in another analyst perspective to illuminate further how it can assist your efforts.
CEO & Chief Research Officer
The importance of product information management (PIM) has become clear in recent years and especially as it relates to master data management. As I recently wrote handling this business process effectively and using capable software should be priorities for any organization in marketing and selling its products and services but also interconnecting the distributed supply chain. Our research on product information management can help organizations save time and resources in efforts to ensure that product information is an asset to facilitate efficiency in many business processes. Through years of benchmarking, we have developed a blueprint for managing and improving product information. Using this approach enables companies to more effectively align and link their activities and processes. Of course achieving effectiveness also requires using applications that create consistent, reliable product information. We regularly update our Value Index for PIM to enable companies to evaluate vendors and their applications’ suitability for use in all business processes requiring product information.
The Ventana Research Value Index methodology evaluates application vendors and their products in seven categories. Five are product-related, assessing usability, manageability, reliability, capability and adaptability, while two quantify the customer assurance issues of vendor validation and total cost of ownership and return on investment (TCO/ROI). The Ventana Research Value Index: Product Information Management in 2015 is the distillation of a year of market and product research by analysts at Ventana Research, the premier benchmark research and advisory services firm. Built on a foundation of 12 years of business and technology research, this unbiased, fact-based index is the first such industry undertaking to assess the value of software designed specifically for enabling product information management.
The Value Index for Product Information Management in 2015 reveals insights into the state of the software market for PIM. It investigates the divide between vendors that are independently focused on this category – Agility Multichannel, Enterworks, Informatica, Riversand and Stibo Systems – and larger ones that embed it in a business application suite – IBM, Oracle and SAP. A third group including ADAM Software and WebOn specializes in a departmental approach to PIM; these companies also are expanding from their European bases to market and sell in North America.
The Value Index analysis identifies two companies, Stibo Systems and Informatica, as the current leaders in PIM; Stibo Systems outscored Informatica by only 0.2 percent. Stibo Systems is rated Hot and ranks first in four of the seven evaluation categories (Usability, Capability, Validation and TCO/ROI); Informatica, also Hot overall, leads in the other three categories (Manageability, Reliability and Adaptability). A primary distinction between the two is that Stibo Systems dedicates its focus to this particular business process and applications while Informatica, through its acquisition of Heiler Software, has integrated PIM software with its own data infrastructure including master data management, data integration, data quality and other key tools. One of the insights resulting from our PIM Value Index analysis is that each of these vendors would benefit from paying attention to the other’s strengths.
Agility Multichannel is the third-ranked vendor for PIM, also rated Hot overall. Making advances in Usability, Reliability, Capability, Validation and TCO/ROI and also in Adaptability through an OEM agreement with Pentaho for integration and analytics, it has dramatically improved its offering in the market. Deeper support for commerce also strengthens its independent approach to PIM. A close fourth is Riversand, another Hot vendor, which continues to advance in many of the categories, particularly Usability and TCO/ROI.
Enterworks finished a strong fifth and is rated Hot overall. Its recent acquisition by Black Dragon Capital and appointment of a new CEO should bring renewed vigor to its market efforts. SAP, ranked sixth and rated Hot, acquired PIM vendor hybris software and entered the market with new marketing and commerce applications that have embedded product content management. SAP also provides data management and related tools to support PIM. Seventh-place WebOn improved from Warm to Hot overall. It has expanded its efforts to North America and made improvements in Usability; its specialty areas are sales and commerce where PIM is not as easily available or integrated with existing processes and systems.
Oracle moved up to eighth place and now is rated Hot. It has improved its PIM offering, particularly in how it supports existing customers and with an interface to applications through its Product Hub and data management technology. Offering PIM independently is its largest challenge, and the Warm rating for Validation and TCO/ROI make it more difficult for potential customers to consider its offering. ADAM Software here makes its initial entry into the Value Index; though it is rated Warm overall, it earned the Hot rating in three categories. It focuses on marketing departments, which often need help in managing product information. Finally, IBM struggles to support PIM as a business application. Its focus is on master data management and associated data integration and quality, and it is rated Warm in support for PIM.
The 2015 Product Information Management Value Index has advanced from the previous version in two major respects. First, we increased the specificity of the characteristics we evaluated in Usability, Manageability, Reliability and Adaptability to be able to differentiate the products better. Second, we increased the number of items in the Capabilities section to reflect the growing need for PIM to provide more depth for both business and IT users. This resulted in lower scores for some vendors in some categories, but others made improvements to their products in the past two years. For example, Agility Multichannel’s score rose significantly, but IBM, which has not made much investment to PIM, remained in last place. Other vendors such as Tibco were invited multiple times but did not respond and were left out of the analysis. Other specialized and vertical application providers such as JDA were left out because they did not meet the evaluation criteria. Still other vendors were acquired, such as GXS by OpenText, and became more focused on providing integration technology; lacking a dedicated focus on PIM they were excluded.
I urge organizations to do a thorough job of evaluating product information management systems and associated applications, tools and information technology. To help we offer this Value Index as both the results of our in-depth analysis of these vendors and as an evaluation methodology. The Value Index can be used to evaluate existing suppliers and also provides evaluation criteria for new projects; applying it thus can shorten the RFP cycle time. It also will eliminate wasted time in traditional evaluations along with the number of resources required to assess and optimize your product related processes with PIM.
Unlike many IT analyst firms that rank vendors from an IT-only perspective, or focus too much on master data management and data infrastructure, Ventana Research has designed the Value Index to provide a balanced perspective of vendors and products that is rooted in an understanding of business drivers and needs. This approach not only reduces cost and time but also minimizes the risk of making a decision that is bad for the business. Using the Value Index will enable your organization to achieve the levels of efficiency and effectiveness needed to optimize product information management. I invite you to learn more about how it can help.
CEO & Chief Research Officer