Chapter 6 Case Study: Panasonic Creates a Single Version of the Truth from Its Data

Question #1: How did Panasonic's information management problems affect its business performance and ability to execute its strategy? What management organization and technology factors were responsible for those problems?

Panasonic’s operations expanded rapidly throughout Europe, Asia, and North America. In Europe, the company has 15 subsidiaries, 14 manufacturing facilities, and five research and development centers, and seven administrative offices. As a result of having so many different sources of data, the company was unable to manage its data effectively. The product and customer data was inconsistent, duplicate, or incomplete. Different segments of Panasonic used their own data management operations that were isolated or different from other locations within the company. Ultimately, this resulted in a decrease in operational efficiency and higher costs from the company. The data required to launch new products in the market are photos, product specification and description, manuals, pricing data, and point-of-sale marketing information. The employees use this data to select product information that suits the needs of the region or country. As a result, with a lack of an adequate database to manage product data, the company was unable to sustain a substantial profit and strategically market new products.

The CEO’s and managers at Panasonic did not anticipate a substantial market demand for their products. They did not seek their employee feedback to determine how the product data and inventory of services could be better managed to seek the needs of the employees, suppliers, and customers. They did not make a thorough analysis of their 5-year business strategy to access whether the company requires new services or capabilities to achieve their strategic goals. They did not perform an adequate IT strategy, infrastructure, and IT infrastructure cost to determine whether the IT strategy takes into account the firm’s five-year strategic plan. Thus, making an assessment to determine where necessary changes in data management need to be done to improve the company’s efficiency.

Question #2: How did master data management address these problems? How effective was this solution?

Panasonic implemented a “push” model to replace a “pull” model to interpret and sort data. Using a push model, a centralized data bank sends the requested information to employees in marketing and sales instantaneously and consistently. Retail partners and e-commerce vendors who are recipients of the data can view the data at all phases of a product rollout. Thus, specific employees can have better visibility of their products and services. The outcome of this push model is that customers are less likely to become confused while researching Panasonic products. Panasonic’s Europe’s data management was upgraded with master-data-management (MDM) software from IBM’s WebSphere line. The software enabled Panasonic Europe to gain better control of their data and better streamline the business process. The MDM implementation includes the business process analysis, data assessment, data cleansing, and a master data service layer. The MDM allows employees with access to view the company’s data and activities throughout the organization. The outcome of the MDM implementation is that Panasonic Europe could expedite its products to customers much faster than before. The system resulted in an increase in company sales and profits.

Question #3: What challenges did Panasonic face in implementing this solution?

Although Panasonic Europe succeeded in gaining profits, Panasonic North America had challenges of reorganizing workflow and consolidating product information. Panasonics investigated product information for Wal-Mart. Panasonic looked closely at its legacy system to determine its required data. Panasonic worked with IBM to develop an interface apparatus to acquire the data for its repository. Since the information produced by legacy systems were not available in the legacy systems, then Panasonic needed to add newer interfaces then build an application-integration layer for Wal-Mart that could be proven successful.

Another challenge was that the company had multiple facilities that made its own new products. The facilities had their own culture and information infrastructure so they were not necessarily willing to share their data with a centralized database. However, Bob Schwartz made a strong case to the corporate office in Japan that integrating a data management strategy globally would be a major benefit to the company’s infrastructure. Schwartz also needed its manufacturer partners to agree with implementing the MDM technology. Schwartz succeeded in gaining substantial profits by integrating shared data inventory among the vendors such as Best Buy and Circuit City. As a result of the implementation of the MDM, Panasonic has become more competitive and can produce new products for their global market.

Article Review: Southwest Integrated Flight Tracking System (SWIFT)

Southwest Airlines implemented a flight management tool to help manage its flight operations data and to sustain its requirement for data management efficiency. Southwest has about 3,400 daily flights requiring status data on flight route, fuel requirements, and weather information. Thus, airplanes must be in the right place at the right time. If status from flight operations cannot be updated and retrieved, then flights can be delayed or canceled. The outcome of Southwest’s requirement was the first generation of a Southwest Integrated Flight Tracking system (SWIFT). SWIFT is a flight management tool consisting of applications for managing the fleet of aircraft and dispatching flights. Although SWIFT helped to sustain better flight operations, the system could not keep up with its growth. Southwest engineers developed a real-time messaging tool that could interface with SWIFT and ensure the delivery of necessary flight data. As a result, Southwest chose TIBCO SmartSockets. This system provides real-time updates for Southwest’s fleet management and operations. It provides guaranteed message delivery (GMD) and monitoring capabilities. For example, if the system goes down for any reason, the thousands of incoming weather messages from the FAA will be queued in the system rather than being lost. Southwest uses SmartSockets’ GMD features to manage the approximately 17,000 FAA weather messages received each day that are sent out, filed in a database, and then published to several different SWIFT applications. As a result Southwest has become leader in implementing newly developed innovative IT applications to achieve its efficiency and quality of service. This newly implemented technology allows for the airline to become competitive against the larger carriers like United, American, Delta, and US Air.

I like the article because it provides a significant milestone for capturing, storing, sharing, and managing flight operations data in real time. This visibility of data allows for the flight operations personnel to make better decisions for sending airplanes to alternate airports based on unpredictable storms or harsh weather conditions. Overall, this enhanced capability has resulted in improving the safety standard for the airline.

Reference: Success Story. Southwest Airlines Flies High with Real-Time Flight Data. TIBCO Software Inc., 2007. Website: http://www.tibco.com/resources/customers/successstory_southwest.pdf