What is Master Data Management?
Your Essential Business Overview to MDM
The following overview explains everything you need to know about MDM and how it brings your data together to create a single, accurate view of your data throughout your enterprise.
MDM is a connected, flexible and scalable platform that provides the efficient management of master data, giving you a single point of truth for business-critical data. It supports business initiatives through identification, linking and syndicating of information across products, customers, stores/locations, employees, suppliers, digital assets and more.
MDM overcomes three primary challenges – and many more -- that you may be facing today:
1.Data silos and multiple versions of your data.
2. Data errors that result from manual entry and maintenance.
3. Dated timeliness, including not knowing which elements of your data you can trust.
MDM allows you to:
Focus your product, service and business efforts on the things that increase sales.
Deliver a highly personal service and engagement experience.
Defocus from unprofitable activities that drain time and resource.
What underpins these benefits is that Master Data Management enables you to:
Eliminate silos of master data that exist in different departments or business units.
Improve operational efficiency by aligning organizational and operational data.
Increase collaboration between internal and external groups.
Enhance the customer experience by using insights to drive business performance.
Save resources by automating a number of essential data processes.
Reduce risks associated with regulatory compliance such as the GDPR.
Master data management is the core component used to manage, centralize, organize, categorize, localize, synchronize and enrich master data according to the business rules of the sales, marketing and operational strategies of your company.
Master data can take the form of product, customer, supplier, location and asset information, in addition to any information sources that drive your business. The efficient management of master data in a central repository provides companies with a single authoritative view of information and eliminates costly inefficiencies caused by data silos.
As your business grows, your IT landscape will become more complicated. Acquisitions, expansion into new countries, and growth in new markets can result in your business running multiple systems, applications, and technologies. This fragmented environment creates significant data management difficulties.
Research from Ventana discovered:
Another report from ‘Demand Gen’ revealed:
According to Ovum research:
MDM provides an organizing approach to data management and increases the value of your analytics and the quality of your data. It connects information, people and processes to help you meet business objectives, as well as validates data, improving the quality and integrity of data.
A World Without MDM is a strange place indeed. A place where the things your customers order are not always what they get, where you’re often bombarded with the same offer multiple times and where sometimes there’s a mix up with your products …
The role of Master Data Management, is to remove silos and place, manage, share and correct your data from one place. The results include:
1.Launch products up to 4X faster.
2.Reduce refunds and customer service queries.
3.Slash your marketing costs by up to 50%.
4.Reduce supply chain complexity.
5.See all your customer information from every source at a glance.
6.Improve operational efficiency.
7.Target customers with more effective marketing and sales promotions.
8.Free up resources to focus on adding more value in other areas.
The more control you have over your data using MDM, the more power you have to meet your business objectives.
PIM, DAM, CDO, data enrichment, matching
Not quite sure what all those abbreviations, terms and hypes mean and how they relate to Master Data Management? Get your MDM facts straight in this A-Z of MDM.
You may be experiencing a number of scenarios that spur you to consider an MDM solution.
Your data is scattered across multiple geographies, departments
You want to identify inaccurate data and clean it to gain a single view.
You want to store your clean master data in a data warehouse so it can be interrogated by business intelligence tools.
Your data related processes are slow and very resource demanding.
Take the below scenario encountered recently by Kraft-Heinz.
They needed to ensure their internal systems and external websites had the same detailed product information, which was a challenge, given they had 22,000 products, more than 23,000 images, and over 200 brands. In addition, new produts or data had to be added automatically to multiple systems.
They implemented an MDM solution to integrate their product and nutrition information, including images and marketing materials, and gain a timely, complete and reliable source of information. The MDM-based single information source is now used by all Kraft Heinz's internal business systems and external websites, as well as by third parties such as Amazon, Walmart
“Excellent knowledge of Master Data systems, including PIM, and able to amplify the benefits for our company.”
- Wayne Phillips,
Master data is a single source of common data, but there are many distinct data types, and often they are duplicated across the business and stored with little agreement on standard definition. According to The Informations Difference's MDM Landscape report, 25% of organizations have 15 or more data repositories. MDM resolves disparate and duplicate data issues, allowing you to manage and govern multiple data types.
Perhaps the most common type of master data is customer records, which include names, email, postal addresses, and customer preferences.
Customer data fuels the creation of amazing experiences, which have the potential to increase customer satisfaction by as much as 20%.
Description, cost, unit of measure and image are examples of product data that help your customers make informed buying decisions.
Studies show that giving people better product information boosts online sales from 17% to 56%.
Recording party data allows you to create the relationships that are vital to gain an accurate understanding of the value of each of your records. It gives you a significant competitive advantage.
Location information is essential for analyzing customer purchasing habits based on geography, gaining a deeper understanding of product, store, and competitor locations, as well as improving the management of your chain of physical stores.
Keeping reference data fields such as country, currency and conversions up-to-date is critical because to making key business decisions, undestanding their impact on the performance of your systems and meeting regulatory compliance.
If you want results from your MDM implementation, carry out these activities to build your strategy:
Start with the end goal in mind. This will help you define and follow a roadmap that will keep your project team focused and aligned.
The roadmap typically ties together the business case actions:
Identify the issues that need to be solved.
Create the project plan that includes the vision, benefits, and timeframe.
List the gaps and gap-closure strategies.
Create a high-level blueprint that extends years beyond implementation.
Your first step to deploying MDM involves identifying the master data domain(s) you should target. It will define the direction, focus and ownership of the project moving forward, and help you reach the end objective in less time, with minimal disruption and at lower costs.
You may need to identify different data owners within your organization to include the MDM project. Consider the roles of each in your new single and central data world.
Establish a collaborative stakeholder team to assign data ownership.
By considering common impediments to large-scale IT projects before implementation, you ensure a fast, efficient path to success.
there’s a risk of MDM being seen by users as purely an IT initiative. Educate your business stakeholders on the benefits of MDM for their work.
MDM involves considerable change, therefore securing support through quick wins is paramount.
you must become a champion for a data-driven business culture. Articulate the importance of MDM to individual stakeholders, the company and customers.
while gathering MDM requirements, remove unnecessary requests to avoid bad design decisions that could be difficult to reverse.
with every discovery that occurs during the implementation phase, immediately assess the budgetary impact and what the change means for the business.
as with any enterprisewide IT project, things change. It’s essential to keep your plan flexible and adaptable by communicating with stakeholders regularly.
MDM extends the value of your IT investments because it integrates and scales with your other systems. MDM covers different data domains relevant to all of your business challenges.
For example, a Customer Master Data Management (CMDM) platform will help you engage with your customers and build unique one-to-one experiences. If your challenge is to get products to market faster or improve omnichannel efforts, a Product Master Data Management (PMDM) approach will work for you. For a comprehensive, holistic approach, you’ll deploy a Multidomain MDM setup. Today many of the world’s largest and most companies select this approach because it gives them the most significant insight and ROI.
You can fuel your digital business and IT initiatives—and deliver experiences customers crave—by gaining a single, unified view of customers. It allows you to:
With Customer Master Data Management (CMDM), you can boost your personalization and customer-centric targeting by using a reliable customer data foundation for segmentation and more. According to Accenture, knowing a customer’s purchase history makes them 65% more likely to choose you. Research also confirms that they’re more likely to pay a premium for an exceptional experience from a brand they trust.BLOG: EXPLORING THE BUSINESS VALUE OF CUSTOMER MASTER DATA MANAGEMENT
Product Master Data Management (PMDM) brings all your data into one place to create a single approved source.
For example, the approach worked with Marks and Spencer, a British retailer, which had 585 different product attributes and eight international websites using five languages. With PMDM in place, M&S was able to:
MDM delivers core data capabilities that connect and provide information to every point in the business. You can truly transform your business strategies because you have high-quality data dispersed enterprisewide.
MDM capabilities allow you to:
combine data from isolated systems to produce a complete picture.
generate accurate, well-structured data that is easy to use in other systems.
link entities to create new information.
collaborate to reduce inconsistencies and improve integration.
know where your data is to make it easier to secure.
There are two things worth noting when it comes to data governance:
1. Data governance policies free you up to focus on achieving business outcomes.
2. A Ventana Research survey indicated that 50% of companies consider the establishment of data governance as a vital capability for product information management.
Without adequate data governance, an MDM project is less likely to succeed.
Whether your organization is investigating MDM or just starting with MDM, there’s a need to understand the fundamental building blocks for success.
Many of these factors will define the elements of the MDM solution you select:
Will the solution solve your particular business challenges?
Do you have a CAPEX budget dedicated (choose on-premise), or would you rather fund through OPEX (choose MDM in the cloud)?
Are you focused on product, customer or multidomain MDM?
Is the scope of the project local or global?
Can the MDM solution scale and futureproof your data requirements?
Is the MDM solution flexible and does it have a broad set of data integrators?
After you’ve built your strategy, but before you embark on your MDM journey, take into account four considerations:
since there are many stakeholders and factors involved in any large-scale IT project, the below guide will help you build the business case.
consider how your plan aligns with the purpose of your business. You should also develop your roadmap to highlight the obstacles you need to overcome.
consider the available delivery options. For example, you could take a linear path that moves through phases or an agile approach that’s more iterative.
consider what success looks like to you and establish clear, attainable metrics to track and measure results.
Working towards the below trends will help you improve the level of control and insight you have over your master data, allowing you to serve customers better, improve business output, remain compliant and increase revenue.
1. Create a seamless customer journey however they engage with you
2. Prepare your business processes for the GDPR
3. Personalize customer experiences, products
4. Use IoT to drive innovation
5. Use of AI to support business decisions