Skip to main content

Picture this.  You are in a business meeting meant to discuss the future of your organization’s marketing strategy.  However, about halfway through, the conversation gets derailed over confusion around the meaning of business terms. Can you picture it? Have you ever experienced this? If so, you are not alone.

In this post, we will explore the importance of a Business Glossary and how a glossary should be the cornerstone of all business efforts.  We will also share a set of simplified steps to follow when creating your first business glossary. 

What is a Business Glossary

A Business Glossary is a set of definitions of the key business terms, concepts, and relationships that are important to business users and decision-makers. Business glossaries help organizations to communicate more effectively by enabling a shared understanding of the meaning and use of terms and concepts (DAMA, 2016). 

Incorporating a business glossary can be a cost-effective strategy for fostering clarity, enhancing communication, and aligning your organization’s efforts, making your journey toward achieving business objectives more efficient and effective.

Why do I need a Business Glossary?

Consider the following example in which a customer is struggling with the definition of their customers. 

  • The brand has direct-to-consumer (D2C) channels where people can order products from the brand’s ecommerce sites. This brand also offers a loyalty program to encourage purchases and to collect data about these people. 
  • The brand has a network of independent distribution partners (business-to-business: B2B) that place the brand’s products into small stores. People purchase products from these local businesses. 
  • The brand also has large national retailers that order wholesale directly from the brand for sale in their commerce channels. People also purchase products from these large national retailers. 

In this example, the brand has two or more types of customers: the retailers that buy the brand’s products for sale in their stores and the people who buy the brand’s products, both directly and indirectly for their own consumption.  

One could argue that all of these businesses and people are the brand’s customers.  Does this argument hold water when categorizing these customers for marketing communications or customer analytics? Likely not. As one would not want to send rewards status or special offers to its large national retailers any more than one would want to send promotional products or volume discounts to the individual households that consume the brand’s products. 

The Glossary for how this brand defines its customers might look like this: 

ConsumersThose households and individuals that purchase our products for the purpose of consuming our products. While we may not have the ability to identify and directly contact these consumers, they are no less important to our brand success. 
Loyal ConsumersThose Consumers that have agreed to share their personal information and transaction data with us in exchange for potential rewards in the form of discounts or free products.  
National PartnersLarge retail distribution partners that purchase our products at wholesale or discounted  rates for the purpose of selling these products to our Consumers in their retail outlets. 
Independent RetailersIndependently owned stores that purchase our products through our B2B distribution channels at wholesale or discounted rates  for the purpose of selling these products to our consumers in their retail outlets. 

This brand’s definition of its customers now reflects the variations of what they see as their relationships. The distinction between different customer types can be insignificant but the impact of communicating incorrectly with a given audience can erode the customer’s confidence in the brand.  Also, you may notice that the names assigned to each customer type aid in the recognition of the relationships. 

OK, So how do I create a Business Glossary?

1. Plan the work: Define the scope and boundaries of the glossary by identifying the organizations to which this glossary applies and the type of terms to be included such as Sales terms, Marketing terms, or Engagement steps. In this step it is also important to define the stakeholders that will provide input or collaboration during the process. It is important to identify those who will use the terms in the glossary and those who have the authority to approve and disseminate the glossary. You will be surprised by how many people claim to have an interest in your work after you make significant progress, so include those stakeholders early! It is also a good idea to identify any similar glossary or data management efforts already underway within the enterprise. 

TP Tip: Determine if your organization has an existing data management or governance structure. If so this group can be a great resource for endorsing your glossary work as well as a source for tools and templates.

TP Tip: Get Sr Executive backing early, for Marketers this is your CMO and don’t forget the CIO.  Both of these executives typically have fiduciary responsibility for data and should appreciate the value of this type of effort. 

TP Tip: the use of a RACI (Responsible, Accountable, Consulted and Informed) Matrix is a good way to manage the roles associated with the glossary project. 

TP Tip: Don’t try to boil the ocean by trying to define a glossary that applies to the entire enterprise and all of its business units. Start with the segment of the organization in which you have influence then branch out when the opportunity exists. 

2. Create the Glossary Structure: This process is iterative and recursive so there is no expectation of a perfect structure at the start.  The glossary structure (or taxonomy, if you want to sound smart in meetings) consists of the columns or fields you want to use to describe each term. In the example above we only have two columns but it is possible to have a dozen or more data points as the glossary matures.  The following is a good starting point: 

    1. Term: The word or acronym to be defined
    2. Definition: The agreed upon definition for the term
    3. Status: As the glossary is a living dataset in which not all terms are fully approved. It is a good idea to track the status of each term’s adoption such as new, in review, approved, returned.
    4. Owner: The organization or person that owns or claims to own the term and has final approval on all changes to the term. 
    5. Related Terms: A place to list other terms that have a relation to this term. In our example above one might list “customer” as a related term to “consumer”

TP Tip:Tools can be as simple as a spreadsheet with a row for each term and columns for the attributes to a built-for-purpose data dictionary or glossary tool. 

TP Tip: Regardless of tool used, use a shared instance of the tool or spreadsheet. Avoid storing the glossary on a personal drive. A sense of ownership and contribution for your stakeholders is key to achieving consistent progress and buy-in on the glossary.

TP Tip: Keep it simple to start, Google Sheets or MS Excel Workbooks are a fine starting place for housing the glossary. For more advanced projects, we use Accurity.AI 

TP Tip: To start, keep the number of attributes (columns) associated with each term to a small set. You do not want initial progress to be delayed due to the inability to fill in extra data. 

TP Tip: Be sure to include all of those acronyms that people throw around like a second language. List the acronyms as line items in the glossary and spell out the words from which the acronym is composed. 

3. Solicit Input: Reach out to your stakeholders to gather their input by asking them to nominate terms and definitions for the glossary. You may want to consider holding workshops where people can submit nominations on the fly with physical or digital sticky notes. After you have collected a sufficient level of input, aggregate all terms into a single list along with the individual(s) that suggested each term. 

TP Tip: Electronic Collaboration Tools such as Miro, Lucidspark or Google’s Jamboard enable synchronous and asynchronous collaboration. Allowing stakeholders to add and review content in a distributed fashion. 

4. Adjudicate the glossary: Working with the stakeholders select a common definition and any required attributes for each term and then obtain agreement on the final set of terms from all those who contributed to the glossary. At this point, all variations of a given term should be merged into a single line item in which all contributors can agree.

TP Tip: It is a good idea to keep a separate line for each individual recommendation along with the name of the person who submitted. It is common to receive multiple definitions for a single term. Having a list of all contributors allows you to include all those who submitted terms in the adjudication round. 

5. Ratify the Glossary: Using the roles and responsibilities list (RACI) created in the planning stage, obtain approval of the glossary. Understanding that the approver of each term may be different, this step will require some patience, pestering, and tenacity. It is a good idea to track all feedback, actions, and approvals so that you have a running log of the glossary’s development progress. 

TP Tip: If you have multiple Approvers, create a list for each Approver and focus their attention on just their terms. This approach will increase the efficiency of the approval process while keeping the approver in their box.

TP Tip: Odds are there will be terms for which multiple stakeholders believe they own or there is a disagreement between these very important people on a definition. Having Sr. Leadership plugged into the project early will provide a mediator for these conflicts. 

6. Publish and Manage the Glossary: This is where establishing a shared file when building the glossary comes to play. A shared version of the working copy can quickly become a published version. Announce the publication to the stakeholders and applicable organizations to which the glossary applies. Go ahead and take a bow for doing something awesome.  However, the work is not done, it is important to treat the glossary as a living document.  

    1. Establish a forum for stakeholders to suggest new or revised glossary entries. 
    2. Create an organizational body to serve as the glossary’s stewart charged with the management of the glossary’s configuration. This body can also foster the continued maturation of your glossary.

TP Tip: Encourage your Sr Leadership to endorse the glossary as a key element of your organization’s operations. 

Business glossaries are key in facilitating communication, promoting shared understanding, and ensuring consistency across an organization. Establishing a shared understanding is a key success factor when planning and executing business objectives. Incorporating a business glossary can be a cost-effective strategy to foster clarity, enhance communication, and align your organization’s efforts, making your journey toward achieving objectives more efficient and effective.

However, a business glossary need not be an arduous task that requires expensive tools and data engineers. By following the steps outlined in this article and keeping it simple, you can start your first glossary and be on your way to establishing a shared understanding across your organization. 

Click here to find out more about how Transparent Partners helps its clients to solve real world problems like achieving business objectives.

John Lillard, Sr. Director, Technology