Breakthrough Master Data
Master data is usually defined as the set of core entities within an organization, depending on the industry it may include customers, prospects, suppliers, sites, hierarchies etc.
The purpose of managing this data is to assure a consistent definition of these business entities and data about them across the organization’s multiple systems, establishing a standard definition for business-critical data that represents a single source of truth.
Master Data Adventure
Deploying master data management can sometimes provide us an experience like when our quiet hike turns into quite an adventure as we enter uncharted territory.
Struggling through all the challenges in an MDM project is not for the faint-hearted.
It doesn’t have to be that way.
There’s a huge number of reasons that lead to failure:
Data silos,
Volume of data,
Incompatible systems,
Integration cost,
Data redundancies and inaccuracies,
Poorly defined use cases,
High data maintenance,
and more.
Most organizations are like an ecosystem, where different business areas or lines of business are run with a certain degree of independence, each pursuing its own objectives. This reflects on the way data is managed, collected, stored, and used – The famous data silos.
Data silos were born out of an organization’s growth, the result of years of initiatives driven by business problems, years of different business strategies, multiple technological options, and even resulting from mergers or acquisitions.
From the master data perspective, data silos are a nightmare, they impact data sharing, data quality, the costs of data acquisition and preparation, with different data definitions, incompatible formats, redundancies, duplications, different levels of data quality, etc.
These ecosystems lead to a serious of issues:
Reduced cooperation across lines of business,
Data siloed within lines of business,
No systematic approach to data quality,
Weak KYC and due diligence standards,
Limited information on customers
All these reasons put master data as a critical driver that enables organizations to exploit the vast amounts of data they gather in an efficient way.
Master data is the heart of the most valuable information that an organization owns, helping every line of business to deliver value.
Master Data Journey
“The journey of a thousand miles begins with a single step.”
Lao Tzu
There is no single approach to starting an MDM project.
Even within the same organization we can find different approaches on how data is handled, this will lead to different levels of maturity, different approaches on how and what data is collected and used.
A good rule of thumb is to start with a business area where we can identify clearly business value to be generated (grounded on business cases) and that has the best conditions to work as a seed for master data. Maximizing the chances for a success story.
This success story demonstrates the value generated, acting as a powerful driver for the incremental integration of other business areas and systems.
A master data management initiative can’t be a stand-alone initiative.
It is a disruptive process, and its success relies heavily on a strong executive sponsorship and on data governance policies and processes.
It’s critical to have an incremental, focused approach, choosing a business case that can bring visibility to the initiative within a reasonable time-frame and budget, to get the stakeholders buy-in and organizational awareness.