On Amazon and Necessary Conditions

Dec 15, 2011 by Phil Simon in Data Management, Master Data Management

Frugaldad.com recently ran a fascinating infographic on Amazon.com (referred to me by my friend TJ McCue). Here it is below:

Many people are amazed that one company can attain such levels of success – and you can count me in. As I’ve discussed before, Amazon can do these things because, first and foremost, it manages its data phenomenally well. In fact, I’d go so far as to say that its data management enables its success. Take away its vast troves of complete and accurate information on its millions of customers, and it would be damn near impossible for the company to do even half of the things that it can do today. In other words, effective data management is a necessary but insufficient condition for success these days.

As someone who paid attention to Amazon from its inception, I have a historical perspective of the company. To be sure, that knowledge helped me in writing The Age of the Platform. Jeff Bezos didn’t care about short-term profits; he was too busy building an infrastructure that would support long-term growth, scale, and a platform-based strategy.

The lesson here for the average CXO is that there’s no Band-Aid, no elixir that will fix your data management problems. Data Warehouses and MDM solutions can help, but don’t expect them to magically transform:

• recalcitrant employees
• poor interdepartmental communication
• broken business processes
• bad business strategy
• dysfunctional organizational culture

Simon Says

Few if any companies will reach the levels of success of Amazon. As a web-native company, Amazon was not encumbered by many legacy technologies and mind-sets that continue to plague large, conservative organizations. But this doesn’t mean that you can’t learn from the world’s largest retailer.

Lesson #1: It’s really hard if not impossible to succeed these days without solid data management. Even if R&D creates the ultimate mousetrap or widget, sales and marketing have to reach your company’s intended audience. And how would you know how much you can even spend on R&D if your AR and AP are a mess.

You can’t.

Feedback

What say you?

Tags: Amazon.com, Data Management, Master Data Management, mdm