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Building a publishing business with "enterprise-wide" data management is fraught with peril--but the payoff is survival
At the beginning of the 1990s, publishing appeared, compared to many other businesses, to be grossly unwieldy, unpredictable, unprofitable, out of control--in short, chaotic.
Here was an industry afflicted by huge advances that led to disappointing sales; skyrocketing returns; loss of control in the distribution channel; loss of vision; and important trading partners forced to wait as long as 180 days to pay for their product.
Top management of the large publishing houses, many of whom came from other industries, felt that things must change.
One of the chief forces driving this opinion was the development of computer systems that promised Electronic Data Interchange (EDI): the exchange of completely electronic information among trading partners regarding job specifications, purchase orders, job status notifications, invoices, advance ship notices, paper usage, component inventory. Data about customer behavior, channel costs, production processes and the like would flow easily and instantaneously. By tapping these rivers of data strategically, and analyzing their patterns, it would be possible for publishers to create new and better products, marketing and channels of distribution, which in turn would increase sales, revenues and profits.
Peter Olson, CEO of Random House, the largest publishing house in the world, was quoted in a U.S. News and World Report article earlier this year: "We saw a need (five years ago) to have an integrated system that would provide, at the push of a button, information that would go throughout the company and be available to customers if necessary."
If that is the dream, how do we get there? The answer that major publishers are currently embracing is: re-engineering through the adoption of "enterprise-wide" software based on relational databases. Relational databases can be very powerful tools, and an enterprise-wide approach should generate the greatest strategic control and efficiency.
The relational database with which most people are familiar are those checkbook programs that automatically add to your balance after every deposit, subtract after every check written or ATM withdrawal, and keep …