Journeys with enterprise master data management

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Companies planning a master data management (MDM) implementation tend to have important questions regarding vendors, strategies and ensuring success and ROI. Fortunately, these companies can learn and benefit from the experiences of organizations that have pioneered MDM and organize their efforts around a common set of principles.  

Some first-generation MDM adopters have been able to build on their initial implementations to address other important business problems. Observing these efforts, certain IT analysts and industry observers laying out models for MDM implementations advocate an incremental approach, usually based on a particular data type or within a single system. Others advocate targeting a single architectural style and then building on that implementation to address other styles.

This type of approach follows a conservative technology maturity curve to keep data governance requirements in check and the overall risk of failure as low as possible. These are legitimate concerns and many organizations have been able to realize modest gains in solving their master data problems by following these precepts. However, limiting the scope of your initial MDM implementation is also likely to constrict the potential for greater success and return on investment down the road.

The true promise of MDM is that it enables the organization to create a single, clean and correct version of its most important reference data and eliminate the business process inefficiencies that arise from conflicts in various data sources. This is why it is far more effective to organize MDM implementations around specific business problems such as compliance objectives, business process optimization, customer on-boarding or financial risk management.

In fact, MDM implementations targeted to specific business problems, rather than around narrow technological concerns, put the organization in a far better position to expand and build on its early successes. With a business-focused approach to MDM, the organization can deploy a complete solution rather than an incremental one. It is still an incremental approach — where the focus is aimed at solving a circumscribed business problem — but one in which you are putting in place the complete set of tools needed to solve larger master data issues. It also enables your data stewards and other stakeholders to gain crucial knowledge and experience with MDM tools and best practices.  

When an MDM initiative is launched to first solve one of the critical business problems within the company, it becomes far easier to turn the solution toward addressing the next critical business problem. For instance, a pharmaceutical company that used MDM initially to improve compliance reporting could easily refocus on solving issues in optimizing the allocation and alignment of marketing and sales resources. Had the same company initially focused on solving master data issues within a single data warehouse, this ability to quickly change focus would depend entirely on the compatibility of the underlying technological resources.

Moreover, with a business-centric approach, the next business problem to be solved could be handled within the same line of business or in a different one. How the company expands its initial MDM solution to solve subsequent business problems within or across multiple lines of business depends upon the centralized or decentralized operational culture of the organization.  As more business problems are solved using MDM, more business processes are streamlined, yielding even more benefits for the organization.

No two MDM journeys are the same.  Companies within the same industry might approach MDM strategy quite differently – some may use a single, enterprise-wide MDM system to solve all of their business problems while others may use local MDM solutions for each of their organizations and roll them up to a global enterprise-level MDM system. An approach that might work for one company might not necessarily work for another.  

Whatever the approach may be, or even if you do not plan to evolve the solution beyond the initial deployment for now, the best insurance is to have a flexible MDM technology capable of supporting the company's current and future requirements. Achieving a successful MDM journey will reap many rewards provided they are well thought out and due diligence is performed right from the start.

Ravi Shankar is the senior director of product marketing for Siperian Inc. You may reach him at rshankar@siperian.com.

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