Module 10 Required Assignment

Case: 3M Moves to a Customer Focus using a Global

Data Warehouse

<Praneet Khandelwal>

Suggested time: 120 minutes

Note: This is a required assignment and counts towards programme completion.

Task: Now that you have gone through 3M’s case study to understand their data analytics
journey, you will be able to apply the insights and learning from the case study by answering
the following questions:

1. The GEDW project is a long-term project that required careful planning and
execution.
a. Describe this project in terms of the seven elements of the DELTA
framework and DELTA Plus model

The GEDW (Global Enterprise Data Warehouse) project at 3M can be described using the
seven elements of the DELTA framework and the DELTA Plus model. Here's how each
element applies to the GEDW project:

1. Data

 Description: The GEDW integrates data from numerous sources, including

transactional systems, ERP systems, web logs, and external data like the U.S.
Census data. This data is extracted, transformed, and loaded into a centralized
warehouse, allowing 3M to have a single, accurate, and detailed repository of
global information about sales, orders, customers, and products .

2. Enterprise

 Description: The GEDW supports enterprise-wide decision-making processes.

It consolidates data from 3M's diverse divisions and provides a unified view
that enables better management and understanding of customer relationships
across the global enterprise. The centralized data warehouse replaced many
disparate data marts, reducing costs and increasing data consistency .

3. Leadership

 Description: Strong leadership was crucial for the success of the GEDW
project. Al Messerli, a veteran IS manager, championed the project, securing
buy-in from top management and the various divisions within 3M. His ability

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 to communicate the project's value and manage organizational politics was key
to gaining the necessary approvals and support .

4. Targets

 Description: The primary targets for the GEDW project were to improve data
quality, provide real-time access to detailed and accurate information, and
support new customer-focused business processes. These targets were aligned
with 3M's strategic shift from a product-centric to a customer-centric approach
.

5. Analysts

 Description: Analysts played a significant role in the GEDW project. The data
warehouse enabled them to perform sophisticated analyses, generate insights,
and support decision-making across various business units. The GEDW
facilitated better customer relationship management, demand planning, and
product tracking .

6. Technology

 Description: The GEDW leveraged NCR’s Teradata RDBMS and WorldMark

massively parallel processing (MPP) servers, providing the necessary
scalability and performance to handle large volumes of data and concurrent
users. The architecture included database servers, application servers, and user
desktop browsers, ensuring high availability and continuous loading
processes .

7. Analytical Techniques

 Description: The GEDW supported various analytical techniques, including

data mining, online analytical processing (OLAP), and multidimensional
analyses. These techniques were applied to understand customer behavior,
track product performance, and optimize business processes .

The DELTA Plus Model

The DELTA Plus model expands on the original DELTA framework by incorporating
additional elements that enhance the analytical capabilities and business impact. For the
GEDW project, the DELTA Plus model would include:

1. Culture

 Description: Shifting the corporate culture to embrace data sharing and

customer-centricity was a significant challenge and achievement for the
GEDW project. The initiative required a cultural change in how data was
managed and used across the enterprise .

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 2. Metrics

 Description: Metrics were crucial for demonstrating the value of the GEDW.
The project showed a substantial return on investment (56%) through cost
savings from eliminating legacy systems, improving sales reporting processes,
and enhancing customer service and sales force productivity .

In summary, the GEDW project at 3M aligns well with the DELTA framework and DELTA
Plus model by integrating high-quality data across the enterprise, supported by strong
leadership, targeted goals, advanced technology, and a shift in organizational culture towards
data-driven decision-making

b. Assess 3M’s data analytics capabilities in 1995 and in 1998.

Data Analytics Capabilities in 1995

In 1995, 3M’s data analytics capabilities were quite fragmented and decentralized. The company was
organized into 50 autonomous, product-centric divisions, each with its own IT group, strategy, products,
and markets. This decentralized structure led to significant challenges in data management and analytics:

 Data Fragmentation: Data was spread across multiple systems, making it difficult to
get a comprehensive view of the business.
 Lack of Integration: Each division had its own IT systems and data marts, resulting in a
lack of integration and consistency in the data.
 Limited Data Access: Access to data was restricted to specific divisions, and there was
little sharing of information about customers and markets across divisions.
 High-Level Aggregation: Aggregate information was only available on division- or
country-specific monthly reports at a high level of aggregation, limiting detailed
analysis.
 Manual Processes: Many processes, such as tracking customer interactions and sales,
were manual and inefficient, leading to data inaccuracies and delays.

Overall, 3M’s data analytics capabilities in 1995 were insufficient for supporting a customer-centric
approach, and there were significant gaps in data integration, accessibility, and quality.

Data Analytics Capabilities in 1998

By 1998, 3M had made substantial progress in enhancing its data analytics capabilities through the
development and implementation of the Global Enterprise Data Warehouse (GEDW):

 Centralized Data Warehouse: The GEDW provided a centralized repository of data,

integrating information from various sources and divisions. This allowed for a more
comprehensive and unified view of the business.
 Real-Time Data Access: Thousands of 3M employees gained real-time access to accurate,
global, detailed information about sales, orders, customers, and products down to the SKU level.
 Improved Data Quality: The data in the GEDW was cleansed and standardized, ensuring

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 higher quality and consistency compared to the fragmented data of 1995.
 Enhanced Analytical Capabilities: The GEDW supported advanced analytical tools and
applications, enabling detailed analysis and reporting. This included support for online analytical
processing (OLAP), data mining, and other decision-support applications.
 Customer-Centric Focus: The GEDW enabled 3M to shift from a product-centric to a
customer-centric approach, providing a customer-centric view of the business. This was
foundational for customer relationship management (CRM) initiatives.
 Cost Savings: The centralized data warehouse reduced costs by eliminating the need for
multiple, disparate decision-support platforms and improving the efficiency of data access and
reporting processes.

In summary, by 1998, 3M had significantly enhanced its data analytics capabilities, moving from a
fragmented, division-specific approach to a centralized, integrated, and customer-centric data
warehousing system. This transformation enabled better decision-making, improved data quality, and
supported the company's strategic shift towards understanding and meeting customer needs.

2. What were the potential pitfalls in this mega project? List at least four pitfalls.

Based on the 3M’s case study, here are four potential pitfalls in the mega project of developing
the Global Enterprise Data Warehouse (GEDW):

1. Resistance to Change:
The GEDW faced significant resistance from IT personnel who were losing control over
their data. Although IT personnel had been centralized into market centers, they still had
to cooperate with the GEDW project to shift decision-support applications away from
legacy platforms. This resistance stemmed from IT personnel focusing on immediate
tasks rather than the broader benefits of the new system.

2. Data Definition and Integration Issues:

The project faced challenges in standardizing data definitions and integrating data from
various systems. The existing data definitions were not suitable, as they were designed by
low-level employees with little understanding of the order fulfillment process. This led to
difficulties in linking data pieces together, particularly for global operations.

3. Executive Buy-In and Support:

Obtaining executive support and buy-in was a significant hurdle. The project required
strong backing from top management and needed a champion with credibility and broad
business knowledge to sell the idea throughout the organizational hierarchy. This process
was time-consuming and essential for the project’s success.

4. Benchmarking and Technology Scalability:

The project involved extensive benchmarking of different technology platforms to ensure
they could handle the load and replace old systems. This was critical because the
financial justification for the warehouse depended on its ability to support large-scale

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 data and user bases. Many platforms failed during benchmarking, highlighting the risk of
technology not scaling as needed

3. What best practices can you take away from this case? Identify at least five best
practices.

1. Strong Executive Sponsorship and Business Credibility:

Ensuring executive sponsorship and obtaining buy-in from key stakeholders at all
organizational levels are crucial. Messerli's credibility and efforts in selling the concept
of GEDW (Global Enterprise Data Warehouse) to top management and division VPs
illustrate the importance of having business credibility and high-level support.

2. Comprehensive Benchmarking:
Conducting extensive benchmarking of various technology platforms is essential to
ensure the chosen platform can handle the expected load and future growth. 3M's
thorough benchmarking process of five different platforms demonstrated the importance
of validating the technology before committing to a significant investment.

3. Cross-Functional Teams with Strong Business and Data Understanding:

Assembling cross-functional teams with a strong understanding of both business
processes and data is critical. 3M's success in developing useful data models and
definitions was due to the involvement of individuals with comprehensive knowledge of
the business and data, as well as the inclusion of global perspectives.

4. Addressing Cultural Shifts and Data Ownership Issues:

Recognizing and addressing cultural shifts and data ownership issues is vital for the
successful implementation of a data warehouse. 3M's effort to shift from a product-
centric to a customer-centric approach required overcoming significant cultural barriers
and ensuring data sharing across divisions.

5. Focus on Long-Term Value and Cost Savings:

Emphasizing the long-term value and cost savings of a centralized data warehouse can
help gain support and drive adoption. 3M's GEDW provided substantial IT savings,
improved data quality, enhanced customer service, and enabled new business strategies,
demonstrating the significant benefits of a well-managed data warehouse.

These best practices highlight the importance of strategic planning, stakeholder engagement,
thorough validation, and addressing organizational challenges in successful data warehousing
initiatives.

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