As the economy recovers, companies are focusing investment on software and systems that enable them to “scale-up” to meet rising customer demand. Master Data Management is often at the heart of these investments because of its pervasive and comprehensive impact on business processes. Data touches everything. Therefore, it becomes difficult to improve systems, service and revenue without high-quality, easily accessible data.
Master Data Management, like other business tools, is evolving in response to the improving economy, and several trends are emerging:
1. MDM will be critical to integrating new businesses as mergers and acquisitions increase.
Mergers and acquisitions create significant challenges for IT departments. Often the systems being used by the newly acquired company are mission critical or even superior to the parent-company’s solution. As a result, IT is burden with simultaneously integrating data and communication while planning and implementing consistent software across the organization. And, as the economy picks up, the frequency and complexity of M&A activity will also pick up.
A strong MDM solution that communicates with disparate ERP, supplier and even CRM systems can bridge the gap during a merger. The MDM can help the parent company:
- Gain visibility of all suppliers, customers and items
- Consolidate and cross-reference data, like supplier prices, to find opportunities for savings
- Eliminate inefficient processes and coordinate the customer experience
- Apply advanced analytics to identify revenue and cost saving opportunities
Your MDM solution should expedite the integration of new businesses and helps you identify where to focus IT improvements.
2. Shallow MDM implementation will drive additional investment in MDM.
Listening to the analysts, you would think that everyone has adopted an MDM solution by now. And it’s true that many companies have some level of master data management. However, many of these implementation do not leverage the full benefits of MDM, for a number of reasons:
- The implementation cycle was too long – exhausting investment before all the functionality was implemented
- MDM strategies and tools have improved – allowing for better taxonomy of data and easier integration to 3rd party data sources
- Older MDM solutions were difficult to monitor and update
Without a clear picture of what is happening within your MDM solution your investment is not fully utilized. Here are some simple ways to tell if your company isn’t leveraging the full functionality that MDM offers:
- Are there large numbers of unclassified items?
- How many companies have an invalid ZIP code or postal code?
- Can you tell which providing systems supply the most error prone records?
3. ERP is no longer the central source of data, as specialized MDM providers expand their functionality.
When you implemented Enterprise resource planning (ERP), you expected that data quality across your organization would improve. The reality is that the ERP system offers the promise of standard, consistent data available across your network. The typical ERP system falls short in several key areas:
- ERP can rarely handle the volume and complexity of aftermarket data
- ERP requires tremendous investment to integrate to multiple suppliers and dealers
- Implementation of a robust MDM using your ERP system, can take years
As a result, many companies don’t have a true view of their customers, products, and suppliers. MDM is complex. A good MDM implementation requires vendor specialization. When selecting an MDM vendor, like Syncron, you need to consider the vendor’s capabilities across data domain, industry, use case, organization and implementation style.
As your business grows, it’s important to consider how the quality of your data will impact cost, efficiency and customer experience. If you haven’t looked at your MDM solution lately, it may be time to review its integration with other solutions, depth of data and ability to specialize to suite your company’s needs.