Integration project: Revamp front-and back-office business processes worldwide, supported by standardized and integrated enterprise software systems.

Enterprise payback: Global sharing and reporting of information; better service to global customers; e-business enablement

IS payback: Get better deals from vendors; savings on development and maintenance

Specialty Chemicals Company Cabot reorganized four years ago into global strategic business units. But its data behaved otherwise. Why? Because each of the old business units marched to the beat of a different drummer when it came to their organization, software systems, data models and fundamental business processes.

This lack of standardization hampered Cabot’s plan to set up shared finance, HR and IS services within each geographic region. "We had multiple customer numbers for the same customer," says Craig Bickel, a Cabot Vice President and Its CIO, who works in the $1.7 billion company’s Boston headquarters. "We would have had to have a call center person run three or four distribution systems, depending on what customer would call them" and what product the customer asked about.

The data dissimilarities also made it hard for the heads of the new global units to get the information they needed to run their business. Not that Bickel didn’t try: The finance function supported by an IS team put up a set of data marts to cull information from the disparate systems. But there were nagging inconsistencies in terms of data definitions, coding structures and data models. The revenue numbers from one system, for example, might include the cost of freight, while those from another might not. So in late 2000 Cabot began a major enterprise-wide business process revamp in which IT plays a crucial, enabling role: overhauling and standardizing all of its back-and front-office business processes, and globalizing and integrating all the software systems that support them. According to Bickel, the company is spending in the mid-eight-figures to achieve four goals: standardize business practices and processes; clean up the company data and reports being shared with management; get ready to do business online (ordering, inventory checks, shipment status and the like); and be ready to handle the ISO standards requirements of global customers.

The implementation involves 20 full-time-equivalent employees from IT, and from the business side, 10 dedicated employees and the contributions of 150 more. Cabot is standardizing on a collection of enterprise software applications-ERP, CRM, manufacturing execution, quality management-plus a global data warehouse and management reporting tool. And it’s linking them all together using an EAI tool (which Bickel says will be 15 percent to 20 percent cheaper than hand-coding the point-to-point integrations, and even more when maintenance costs are factored in). Cabot has completed the bulk of the data standardization effort and is about halfway through the application rollout, having gone live with it in eight plants in Europe, five in North America and one in South America. It has already started to see some gains, says Peter Smith, director of business process improvement.

By combining and standardizing vendor information from all of its plants, for example, Cabot discovered that some plants were getting better deals than others from the same vendor. That information can help Cabot negotiate better deals for everyone.

When it comes to the ROI for the project as a whole, Bickel and Smith demur about revealing specific figures, other than to say that the effort is expected to pay for itself with a year of completion in mid-2003.