Lesson 3 — The Five Operating Models
1. Decentralized
Structure: Data Management responsibilities are distributed across lines of business and IT, usually coordinated through committees, with no single enterprise owner.
Strengths: - close to local requirements; - flat and relatively easy to start; - preserves local business knowledge.
Risks: - collaborative decisions can be slow or difficult; - standards and ownership can be inconsistent; - the structure can be less formal and less sustainable.
Deciding clue: distributed/local work + committee coordination + no single owner.
2. Network
Structure: Keeps distributed roles but formalizes connections and accountability, commonly through a RACI.
RACI = Responsible, Accountable, Consulted, Informed.
Strength: adds accountability without forcing a reporting-line reorganization.
Risk: the RACI must be maintained and enforced; a document nobody uses does not create meaningful accountability.
Deciding clue: decentralized execution plus explicit documented accountability.
3. Centralized
Structure: Major Data Management functions report into one formal Data Management organization/leader.
Strengths: - clear executive accountability; - easier decision-making; - stronger formal organization.
Risks: - major organizational change; - possible separation of data specialists from business-process knowledge.
Deciding clue: one DMO owns the functions.
4. Hybrid
Structure: A central Center of Excellence supports/directs decentralized business-unit Data Management teams. Executive and tactical forums connect the levels.
Strengths: - enterprise direction and support; - meaningful local business focus/accountability.
Risks: - new COE headcount; - conflict between enterprise/central priorities and BU priorities.
Deciding clue: central COE + BU teams retain meaningful roles.
5. Federated
Structure: An enterprise DMO/COE sits above multiple divisional or regional Data Management structures. Strategy is centralized while execution remains distributed.
Strengths: - enterprise consistency with regional/divisional autonomy; - especially useful for large/global organizations.
Risks: - more layers and complexity; - continual balancing of enterprise priorities against semi-autonomous regions/divisions.
Deciding clue: enterprise layer + multiple regional/divisional layers.
Fast changed-fact ladder
- Decentralized + maintained RACI → Network.
- Centralized but local BU teams keep accountability under a COE → Hybrid.
- Hybrid + multiple regional/divisional DMO layers → Federated.
These are recognition aids, not a mandatory maturity staircase.
Source anchor: Chapter 16, pp. 523–527.