By Jim J. Spiegel
When you’ve seen the advantages of digitizing your business and are ready to transform, it may be challenging to decide where to start. What comes first, the harmonized database or the business use case? In this discussion, we’ll walk through a selection of relevant considerations to address this critical question in the digital transformation journey.
The best starting point is to define data harmonization. A simple yet effective definition of data harmonization comes from the University of Michigan Data Sharing and Demographic Research: “Data harmonization refers to all efforts to combine data from different sources and provide users with a comparable view of data from different studies.” The key is the combination of disparate data sources to provide users with a comparable view.
Nate Hoyt, UL Solutions Senior Content Manager, echoes this sentiment regularly. In Hoyt’s opinion, “the answer to almost all data integration questions is, ‘Yes, but it depends.’ I’ve been working with plastics data for over 23 years, and a large portion of the data remains unchanged. Sure, there may be more multi-point data available, and the downstream software applications are becoming increasingly sophisticated, but the data remains more or less the same. This is a critical understanding of data structure and harmonization: With well-structured data, the sky is the limit regarding how it can be manipulated. But the inverse is also true with unstructured and unharmonized data. The structure really dictates where it falls on a spectrum of usability.”
The key aspects of harmonized data:
- Harmonization is the effort to combine data from multiple sources using distinct definitions or data scales.
- The objective is to provide users with understandable data translated across sources to be comparable between the different sources.
- Usability is correlated to structure. If data is challenging to access and utilize, it holds minor value to the end user.
Harmonizing the data is key to the success of any digital transformation, but it doesn’t stand alone. An organization must have a solid business use case for “why.” A Harvard Business Review article titled “Digital Transformation Is Not About Technology” claim that 70% of all digital transformation initiatives do not reach their goals. What is the reason for this? “Fundamentally, it’s because most digital technologies provide possibilities for efficiency gains and customer intimacy. But if people lack the right mindset to change and the current organizational practices are flawed, [digital transformation] will simply magnify those flaws.”
The article identifies five key lessons from organizations implementing digital transformation strategies, and their first point is to “figure out your business strategy before you invest in anything.” As they explain, “Leaders who aim to enhance organizational performance through the use of digital technologies often have a specific tool in mind. ‘Our organization needs a machine learning strategy,’ perhaps. But digital transformation should be guided by the broader business strategy.” One comprehensive digital tool may be able to solve all of your needs, or perhaps a series of more minor changes would better support your business growth. Clearly articulating and evaluating your strategic needs as a business use case can be a great first step in a digital transformation.
Within most organizations, there are no shortages of business use cases in this new digital age. A relatively quick dive into hypotheticals uncovers a few genuine opportunities to deliver client value through data connection. ‘Wouldn’t it be great if the user could click this and see that result?’ The answer is typically, ‘Yes, but how would that work?’ From our experience, most of the UL Solutions data integration scoping meetings come to this inflection point.
We’ve identified that the database itself is not necessarily the critical component but rather the structure and harmonization of the referenced database. Similarly, the business use case is not the only critical component but rather the ability to deliver an effective broader strategy.
In my role with UL Solutions, I have had the opportunity to attend numerous customer meetings discussing the digital transformation process of industry-leading organizations. While there is no one-size-fits-all solution, my experiences align with what was explored in this article. I encourage you to consider the following questions to begin executing your digital transformation initiatives:
- What does data harmonization mean to your organization? Are the critical attributes represented by numeric values or text fields? Are these attributes common across data sources? If not, what reference fields are required for mapping?
- How is the data currently structured for usability? Are other teams interacting with the data? Are tools built with the data? What subject matter experts or users of this data are available for support?
- Is your digital transformation focused on the value of your digital assets in the form of a central database, or is the value derived in how well multiple databases communicate? Is a central database being built, does one exist, or is communication between several sources the objective?
- What use cases have been identified? How many internal teams have identified data needs? What is the delineation between a use case and a strategy? Does the organizational strategy service all known use cases?
- What is the broader strategy for data harmonization and digital transformation? What is the timeline for executing this change?
- Does alignment exist to support and embrace the changes in data access and use? Does your organization embrace this cultural shift? This alignment may differ for the various use cases and teams impacted by data transformation.
Identifying where to start your company’s digital transformation may still be challenging. The best answer is that your organization will need well-structured and harmonized data to support the many possible use cases across various teams.
Join us for our next installment of the series, where we focus on the use of these digital tools and resources that come as a result of an organization’s digital transformation.
Resources
- Digital Transformation Is Not About Technology (hbr.org)
- Data Harmonization (umich.edu)
- Digital Transformation in the Chemical Industry Part 1
Learn more about UL Solutions data integration services to help your organization with its digital transformation.
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