Data Warehousing Implementation Success: The

Findings Using Different Research Methodologies

Hugh J. WatsonTerry College of BusinessUniversity of Georgiahwatson@terry.uga.eduhttp://www.terry.uga.edu/~hwatson/implementation_success.ppt

Research on Data Warehousing Started in 1994 Has focused on implementation

issues and organizational benefits Has utilized a variety of research

methodologies

First American Corporation FAC -- A bank in trouble Enter a new management team A CRM strategy, Tailored Client

Solutions, was created

Client Informationknow the client

better than anyone

Consistent Servicehelp the clientachieve goals

Flexible Product Lineprovide what the

client needs

DistributionManagementoffer the client

preferred channels

The Client

“About life. About you.”

First American Corporation FAC -- A bank in trouble Enter a new management team A CRM strategy, Tailored Client

Solutions, was created A data warehouse called VISION was

developed to support the strategy

TransactionClient

Transactions

Products

Psychographics

Demographics

ClientInteractions

Measures

Teller TransactionsATM TransactionsPC Banking

LoansDepositsInvestments

NameOccupationHead of Household

Buying PreferencesFinancial SegmentsLifestyle Groups

BalancesFeesProfitability

Marketing CampaignsCustomer CallsMailer Responses

First American Corporation

Applications using VISION were developed for every component of TCS

Applications for Every Component of the Strategy Client Information: Customer

Preferences and Profiles Flexible Product Line: Profitability

Analysis for Seniors Accounts Consistent Service: Contact

Management System Distribution Management:

Distribution Management System

First American Corporation External talent was brought in as needed A phased implementation strategy was

followed, with short-term wins Only after early successes, was the

strategy fully communicated throughout the bank

Incentive and reward systems were changed

The Outcomes at FAC The bank was transformed A shift from “banking by intuition” to

“banking by information and analysis” Profits of over $211 million (US) in 1998 A leader in the financial services industry Won the 1999 Society for Information

Management Award

What Was Learned A strong business vision is more

important than existing in-house IT expertise

Acquire the needed business and technical personnel

Both organizational and technological changes are necessary

Plan for "quick hit" success, and repeated successes

Whirlpool An international manufacturer of

appliances In the early 1990s, several business units

saw the need for integrated data IT saw a data warehouse as a way to

improve the technical infrastructure Sponsorship for the warehouse came from

a senior IT manager, who left shortly after initiating the project

Whirlpool Specific applications were developed

based on the warehouse -- quality, global purchasing, and cost recovery

Users are pleased with the warehouse but it has not dramatically affected how the company is run

Senior management is aware of the warehouse but does not view it strategically

A Question: Why were the returns from data warehousing so much greater at FAC than Whirlpool?

Time savings: for data suppliers

for users

More and better information

Better decisions

Improvement of business processes

Support for the accomplishment of strategic business objectives

easy to measure

hard to measure

local impact

global impact

Forming a Powerful Guiding Coalition

Creating a Vision

Communicating the Vision

Empowering Others to Act on the Vision

Planning for and Creating Short-Term Wins

Consolidating Improvement and Producing Still More Change

Institutionalizing New Approaches

Establishing a Sense of Urgency

What Was Learned Kotter’s theory of organizational

transformation can help explain and predict why some organizations are more successful with their data warehousing efforts

Factors Affecting Data Warehousing Success Data warehouses are claimed to have

high failure rates; hence, the need for research

Most of the current knowledge is anecdotal and based on experiences in a few firms

A research model was developed and data were collected from 111 organizations

Factors Affecting Data Warehousing Success Partial Least Squares (PLS) was used to

test the research model

OrganizationalImplementation Success

Champion

Resources

Management Support

ProjectImplementation Success

TechnicalImplementation Success

DataQuality

SystemQuality

PerceivedNet Benefits

Team Skills

User Participation

Development Technology

Source Systems

R2 =.419

R2 =.435

R2 =.205

R2 =.016

R2 =.128

R2 =.369

.440***

.072

.088

.219***

.271**

.094

.177**

.401***

.138

.169*

.276***

.235**

.071

.177*

.042

.063

.113

.142*

.549***

System SuccessImplementation SuccessImplementation Factors

What Was Learned Many of the traditional IT implementation

factors apply to data warehousing Other factors, however, affect system and

data quality Implementation success factors can be

grouped together for parsimony Findings may be applicable to other

infrastructure projects

Comparing the Research Methods Choose a best practices company The company can be a source of useful

insights and examples A single or multiple case studies can be

used to develop or test theories Positivistic research provides more

generalizable findings but may be weaker for providing new insights

References

Cooper, B.L., H.J. Watson, B.H. Wixom, and D.L. Goodhue, "Data Warehousing Supports Corporate Strategy at First American Corporation," MIS Quarterly, (December, 2000), pp. 547-567.

Haley, B.J., “The Benefits of Data Warehousing at Whirlpool,” Annuals of Cases on Information Technology Applications and Management in Organizations, Hershey, PA, Idea Publishing Group, 1999, pp. 14-25.

Kotter, J.P., “Leading Change: Why Transformation Efforts Fail,” Harvard Business Review, (March/April, 1995), pp. 59-67.

References Watson, H.J., D.L. Goodhue, and B.H.Wixon, “The Benefits

of Data Warehousing: Why Some Organizations Realize Exceptional Benefits,” Information & Management, (forthcoming).

Wixom, B.H. and H.J. Watson, “An Empirical Investigation of the Factors Affecting Data Warehousing Success,” MIS Quarterly, (March, 2001), pp. 1-25.

Danke