Software AG Buys Data Foundations: Business Acumen Meets Data Competency

Co-authored with Forrester's Clay Richardson.

On September 18, 2010, Software AG (SAG) — best known for its business process management, B2B, and SOA-based integration solutions — announced its acquisition of Data Foundations, a master data management (MDM) vendor based in Hackensack, New Jersey. Data Foundations is smaller and less well known than the more mature and comprehensive MDM solutions from Initiate Systems and Siperian, both of which were acquired earlier this year by IBM and Informatica, respectively. Once Initiate and Siperian were taken off the market, no tier one MDM vendors remained for potential suitors to consider — especially those that could support both analytical and operational use cases. Having missed out on the opportunity to snag one of those leaders, we believe Software AG made the right technology choice in selecting Data Foundations. 

Who is Data Foundations?

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The Crossroads Of Meaningless Clichés: The Key To Scoping MDM And Data Governance

The tech industry just wouldn’t be the same without conflicting acronyms, useless vendor “marketectures,” and the industry analyst bread and butter: buzzwords (Anyone interested in investing in my new company? It’s called “Social eWebCloud 2.0.com.” Just make the checks out to cash!)

But my favorite weapon in the tech business leader’s armory is the overused and meaningless cliché. In reality, many of these clichés are simply metaphors that have been so overused that they lose their punch. I’m the first to admit, they are near impossible to avoid, and I use many of them time and time again. Why? Because they are familiar, and they can effectively help a speaker communicate a potentially complex idea in a simple, concise way. For example, which is easier to say?

  • “There are a large number of potential projects or deliverables we can consider for our organization, but if we attempt to do them all, we run the risk of overextending our budget and resources and in the end will not deliver effective business value.”

Or . . .

  • Don’t “boil the ocean”.
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What’s Next On The MDM Horizon?

Many large organizations have finally “seen the light” and are trying to figure out the best way to treat their critical data as the trusted asset it should be. As a result, master data management (MDM) strategies, and the enabling architectures, organizational and governance models, methodologies and technologies that support the delivery of MDM capabilities are…in a word…HOT! But the concept of MDM - and the homegrown or vendor-enabled technologies that attempt to deliver that elusive “single version of truth”, “golden record”, or “360-degree view” - has been around for decades in one form or another (e.g., data warehousing, BI, data quality, EII, CRM, ERP, etc. have all at one time or another promised to deliver that single version of truth in one form or another).

The current market view of MDM has matured significantly over the past 5 years, and today many organizations are on their way to successfully delivering multi-domain/multi-form master data solutions across various physical and federated architectural approaches. But the long-term evolution of the MDM concept is far from over. There remains a tremendous gap in what limited business value most MDM efforts deliver today compared to what all MDM and data management evangelists feel MDM is capable of delivering in terms of business optimization, risk mitigation, and competitive differentiation.

What will the next evolution of the MDM concept look like in the next 3, 5 and 10 years? Will the next breakthrough be one that’s focused on technology enablement? How about information architecture? Data governance and stewardship? Alignment with other enterprise IT and business strategies?

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Is EMC Moving To Tackle Data Management Market?

As I’m sure everyone has heard by now, EMC acquired data warehouse appliance vendor, Greenplum.  I don’t cover the data warehousing and analytics space, I leave that to my colleague Jim Kobielus who discussed this acquisition on his blog. While many data warehousing and analytics thought leaders will debate the likelihood that this acquisition will spark a wave of consolidation in the DW/analytics space, I’d like to focus on what’s going through the mind of the acquirer: EMC.   I was intrigued by this acquisition because EMC has been on my very short list of potential new entrants into the data management software space, especially concerning master data management (MDM) and data integration.

So to cut to the chase, in this blog post I’m going to recommend to EMC that they acquire both Informatica and TIBCO and challenge IBM for world domination of the information management market.  Here’s my thought process:

EMC hinting at data management interest for a while now

EMC, a $14+billion information management powerhouse, has a product portfolio very focused on the unstructured content side of the information landscape. According to its latest 10K filed earlier this year, most of its business comes from its hardware and software Information Storage solutions ($10.7 billion), but significant business also contributed by its VMWare Virtual Infrastructure ($2+ billion), Enterprise Content Management and Archiving ($740 million) as well as its RSA Information Security solutions ($606 million).

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Data Governance Remains Immature: Increase Focus On Business Process To Build Momentum

I just read a great blog post by Marty Moseley discussing the results of a data governance survey he and his team recently fielded. The feedback he collected matches recent data-governance-related surveys and interviews I've done with my clients at Forrester - the general consensus being that most data governance programs - if they exist at all - remain extremely immature and fraught with risks. The most common roadblocks range from minimal to no executive sponsorship (as Marty also noted), IT-driven efforts with limited to no business participation, lack of business justification and the ever-present likelihood of "de-prioritization" when a more compelling initiative or fire drill comes along.

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“What BI Is Not” Forrester TweetJam Recap And Takeaways

On May 13th, Forrester analysts Boris Evelson, Jim Kobielus, Gene Leganza, Holger Kisker and Noel Yuhanna joined me in hosting a data management TweetJam on the topic “What BI is Not!” using the hashtag #dmjam. (You can still see the results and ongoing conversation if you search the hashtag.)

During this one-hour TweetJam, we asked the following questions, leaving 10 minutes of Tweet-time between each question:

  • Do you prefer the broad or the narrow definition of BI? Should ETL, DQ, DW, MDM be considered part of BI?
  • How should we differentiate BI and analytics?
  • What’s the difference between business intelligence and other forms of “intelligence” like competitive intelligence, market intelligence?
  • Is convergence of structured and unstructured information hype or reality?
  • Is BI looking only through the rear-view mirror, or should historical and predictive BI be one and the same?
  • How will social media impact traditional BI?

The response to this event was extraordinary, and we have a large community of data management and BI thought leaders who joined the conversation to thank. During that single hour there were over 360 Tweets with 65 unique Tweeters actively joining the conversation (not including those who only listened). If you include Tweets leading up to the event and the continued conversation after the event, we’ve seen over 480 Tweets and over 100 Tweeters … and growing.  

But what did we accomplish (aside from providing an entertaining distraction for a number of people)? Below, I’ve summarized a sampling of the takeaways that were shared by some of our participants on each question:

1. Do you prefer the broad or the narrow definition of BI? Should ETL, DQ, DW, MDM be considered part of BI?

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Social Media Will Play A Big Part In BI’s Future

When preparing for our upcoming Forrester Data Management Tweet Jam (May 13th, 2-3pm ET) -“What BI is Not!”- I got together with a few of Forrester’s data management and BI analysts to discuss some of today’s key BI questions.

The question on the table was, “How will social media impact traditional BI?”

Here’s a snapshot of what we talked about:

Jim Kobielus: (Twitter: @jameskobielus)

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TIBCO jumps onto MDM M&A train with acquisition of data matching vendor Netrics.

On March 25, 2010 TIBCO Software announced that they acquired Netrics, a small, private data matching vendor.    TIBCO and Netrics had a pre-existing OEM relationship that was originally announced in June 2009, where TIBCO embedded the Netrics match engine into its Collaborative Information Manager (CIM) master data management (MDM) solution.  

Netrics differentiates its advanced matching engine by describing how it “Matches data based on a mathematical model that mimics human perception of similarity, identifying hidden relationships in the data.”   The Netrics matching engine includes a self-learning capability that improves the confidence in its matches over time by also evaluating manual matches made by business users.   Netrics business and technology approach to this market made it a ripe (and obvious) acquisition target since it developed the match engine to be completely embeddable in existing applications with the vast majority of its revenue coming from OEM and SI channels. In addition to TIBCO, Netrics current MDM OEM partners also include Data Foundations and Kalido. This bodes well for TIBCO’s ability to further integrate these capabilities into its product portfolio.

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Interested in how well SAP is addressing your data management and BI requirements?

It would be an understatement to say that data management is a hot topic today.   Master data management, data quality management, metadata management, data integration and data governance have all emerged as high priorities for many global IT organizations. Often times, these data management efforts are paired with investments in business intelligence and facilitated by data warehousing strategies.

Once the strategy, business case, and supporting architectures and organizations are defined (no easy task in and of itself), the next inevitable question is then, which vendors should IT leaders partner with to enable these strategies? There are pure play and best of breed MDM, data quality, BI and DW vendors that offer unbiased, agnostic approaches, eliminating any vendor lock-in or reliance on database platform or enterprise applications. On the other hand, a single platform vendor can offer better ease of integration with existing IT infrastructure than the best of breed alternatives.

These considerations lead us to a major platform vendor, like SAP.  Similar to its mega-platform competitors, IBM and Oracle, SAP offers a deep and wide set of data management, BI and data warehousing solutions that promise not only integration within these products, but more notably - across its broader product portfolio of enterprise applications.

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Trends in ETL Adoption

In this podcast, Rob discusses some of the preliminary findings from Forrester’s November 2009 Global ETL Online Survey. He also directs listeners to more of Forrester’s ETL research.

http://www.forrester.com/role_based/images/author/imported/forresterDotCom/Podcasts/BPA/rob%20karel%202-26-10%20mixed.mp3

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