Partners Form Data Warehousing Lab

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Digital Equipment Corp. and four software vendors have pooled their resources and expertise to form a laboratory for financial services institutions to construct and test data warehouses and learn ways to accelerate the return on their investment and reduce costs and risk.

The Center of Excellence for Customer Relationship Management, Greenwich, CT, was formed last month by Digital (now part of Compaq), Cogit Corp., Exchange Applications Inc., Norbert Technologies and Profit Management Group. The center is fully supported by the partners, and its services are free for financial companies.

The partners concluded that the pooling of data from disparate sources is one of the chief bottlenecks that hinders return on investment and increases risk. They propose to solve an institution's data problem and let it focus on business problems. That may mean helping a bank build a data warehouse faster or giving it the tools and applications to accelerate the process.

Tom Richards, director of financial services industry solutions at Digital, Marlboro, MA, emphasized that the center is not in the business of outsourcing but should be viewed as an industry resource.

"We hope customers will use it for trials and experiments,'' Richards said. "They may run a campaign out of the center, but it was not constructed for that purpose.''

Using the center, an institution can circumvent a multiyear commitment to working on a large, elaborate open data warehouse model that will anticipate all their data needs well into the future.

"It's like going to a showroom and taking a car home for a day or two,'' Richards said. "The center is a proof point to test things before projects are invested in. Here's a place to go without spending potentially countless millions of dollars going down a path that doesn't pan out.''

Each partner brings a core competency to building and implementing a data warehouse:

* Norbert Technologies, Greenwich, CT, through its CorWorks software, compresses all the transaction data of an institution to 8 percent of its normal size then merges it into a single data warehouse for aggregration, extraction and householding. A merger of such vast amounts of data is normally not possible because it absorbs too much computer storage space.

* Profit Management Group, Malvern, PA, analyzes the data to design account profitability systems and methodologies.

* Exchange Applications, Boston, uses its VALEX software to automate and accelerate the marketing process from campaign planning to execution, assessment and refinement.

* Cogit, San Francisco, completes the customer-response management cycle with its Active Modeling predictive behavior software that helps institutions optimize their programs and build brand equity.

* Digital supplies the AlphaServer hardware to make it all work.

The center doesn't intend to teach institutions how to build data warehouses but provide them with the wherewithal to get the most marketing power out of their systems, Richards said. Great data is useless if not harnessed correctly, he added.

"There is always an urge to go home and build a huge multi-terabyte warehouse,'' he said "That isn't necessarily the way to get returns in hand quickly."

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