Final article in a six-part series on the “New Age of Master Data Management”
by Julie Hunt
For years, there have been industry professionals and analysts who seemingly find pleasure in declaring some type of technology “dead”. This compulsion has been a constant in the software industry. Master data management (MDM) is no exception. Some have been convinced that MDM was DOA practically from the day it emerged as a distinct form of data management and data governance. Making such a declaration attempts to make the case that MDM no longer serves a purpose or that it never succeeded in its ‘mission’.
The proof of what MDM can do to transform an Organization is easy to find. Numerous case studies show how MDM successfully improved data management and data quality, took companies to greater use of data, and contributed to real value in support of goals and desired outcomes. Beyond case studies, the vendor landscape for MDM software solutions continues to grow and evolve. Both traditional and newer MDM software vendors have developed innovative solutions and approaches to master data management that offer improved alignment with business requirements and objectives, and faster paths to realizing value.
If MDM is so useless, why do we have all this activity over these many years? Why would new and innovative technologies continue to emerge if organizations weren’t finding that MDM helps them meet many data, process and business challenges?
If not MDM, Then What?
I’d hope by now that most organizations understand that they live and breathe data for just about every aspect of the business. And if these organizations want to at least ensure competent use of their data, they should also understand that data management is a must-have. But today, companies have to do a great deal more with the avalanche of data that flows into, through and out of the organization. Data management moves several levels higher for meeting business needs when MDM and data governance initiatives are implemented. MDM practices and Processes coupled with the right-fit technologies enable many business-critical objectives and contribute to competitive edge.
Those who denigrate MDM seem to imply that MDM serves no purpose. Without MDM, an organization will likely lapse into a sort of ‘data anarchy’ where there is no common standard for data and definitions, no confidence in the reliability and timeliness of data, no optimization of the systems and processes that run through every business function and activity. Such ‘anarchy’ can even infect the selection of technologies to handle data, due to the lack of an overarching framework based on corporate data strategies that would have been developed through MDM initiatives.
Organizations will always have to manage business data. But that’s not enough. MDM introduces higher quality processes that are clearly aligned with business needs and objectives. Organizations benefit from master data that provides context for other sources of data to be able to achieve optimal results from comprehensive analytics, insights and improved decision-making. Master data processes can help identify missing data, inaccuracies and redundancies that will likely skew analytics results with potentially harmful consequences.
Unrealistic Expectations for MDM
If organizations have weak or no strategies around data usage for business, MDM initiatives and technologies can’t fix what’s already broken in organizations. MDM practices and processes combined with technologies do not deliver a ‘magic wand’ that will conquer all organizational ills. So-called MDM ‘failures’ have much more to do with difficulties and obstacles emanating from the politics and people aspects that are so critical to successful implementations of MDM and data governance initiatives.
For MDM to deliver value and benefits, management (often including the C-level) must have good comprehension of the important role that MDM plays across the organization. And management must deliver full backing of what it will take to successfully implement comprehensive MDM. There is now extensive guidance available through publications, blogs, consultants, and many other resources that show how to connect MDM to business value through means such as strategic business cases, and metrics that link MDM activities to desired business outcomes.
A well-implemented MDM initiative actually strengthens the strategic nature of organizations since such an initiative is clearly connected to business-drivers and to helping to achieve goals and objectives. The primary leaders of MDM-related activities should work to align managers across the organization as supporters of MDM. The benefits to each functional area should be clearly communicated, along with the strategic vision of how MDM contributes to specific business impact.
Why MDM Has Persisted
MDM provides a core platform of advanced data management and data governance capabilities that are essential for organizations building strategies around data and analytics. After all, master data comprises the consistent business-ready data that runs through many (if not all) processes, systems and applications. As data-focused organizations continue to evolve the use of data and analytics, MDM grows in significance and innovative substance. Master data has become the “rosetta stone” for highly disparate sources of data. When big data is connected to master data that provides context and relationships, organizations can now derive value and usability from big data.
MDM practices and technologies, and the development of reliable master data, are not the end objective, but are the means to enable organizations to realize strategic vision and achieve key objectives. MDM initiatives achieve success because they focus on specific business drivers and business-led initiatives, and are set up to change as organizations change. Such MDM success translates into organizations that continuously benefit from faster utilization of timely, reliable data.
MDM anchors many significant, even critical, functions:
- Real-time analytics / BI processes
- Big data analytics
- Automated processes for information and data processing applications
- AI and machine learning efforts
- Compliance and risk management
- Improving customer experiences and interactions
- Cost reductions
- Ability to anticipate, analyze and adapt to market changes
- Agile responses to change for competitive edge
MDM has persisted because of what it tackles. MDM jumps into many of the messiest aspects of an organization: data silos, unconnected systems and processes, management turf wars, politics, and the organizational roadblocks to disparate people working together effectively for common purpose. What MDM takes on to achieve business-usable master data and better processes reflect many of the problems that organizations must solve to survive, adapt, compete, and achieve desired outcomes.
So it’s about time for master data management to enjoy a ‘New Age’. The creation and use of master data for business purposes has always been a good idea. The goal has been to make sense of all data that touches the organization: clean it up, add context, enrich it, and put it to work strategically as well as operationally.
Organizational Resilience in the Face of Business and Market Volatility
Many organizations continue to encounter increasingly volatile markets that have given rise to more complex business environments. Such volatility can become a hurdle for achieving financial success and often translates to significant risk. Organizations need more sophisticated analytics and decision-making processes to assess market conditions and to determine whether “risk” means opportunity, danger, or even both. Master data is an important component of essential processes for insight into market conditions, supporting functions like real-time continuous analytics and responsive decision-making.
While more senior executives do see the value of data analytics and MDM, many organizations are still making critical decisions based on spreadsheets. These organizations aren’t able to respond to market volatility with comprehensive intelligence rooted in the right data and analytics. Since MDM is tightly bound to business drivers and functions, it’s already positioned correctly as the right partner for real-time analytics that support critical business decisions.
Organizational agility and adaptability are defining facets of competitive edge, particularly in the face of market volatility. The agile business requires continuous processing of data from many disparate sources that must be transformed into consistent and trustworthy data with relevant context. Speed to decisions and to actions of change is improved and better grounded in the right information when MDM processes are involved.
MDM can provide pathways to help ‘future-proof’ organizations. Being future–proof means harmonizing technology, people, and processes to tackle the challenges ahead. When implemented effectively, MDM greatly improves methods used to address the challenges that organizations face every day. MDM practices, approaches and technologies continue to evolve to help solve complex business problems.
The New Age of MDM
Master data management and data governance have indeed entered the ‘New Age of MDM’. The practice of MDM has become stronger through building on common cause with business, rather than a sole focus on technology. Technology vendors have made advancements with MDM software solutions by understanding the critical nature of MDM aligned with business needs, objectives, optimal processes, and involved business users.
MDM provides the greatest benefits when practitioners embrace the strategic aspects of an organization and help to enact them through processes, practices, policies, and organizational changes. Strategic use of MDM also gives rise to cross-functional and cross-organization integrations of people and systems. A successful MDM initiative comprises a holistic endeavor to provide strategic organizational and infrastructure change, as well as manage complex data processing. Part of MDM holism is the intertwining of business, people and technology in the most effective mix possible.
On the software solution side, MDM is the “poster child” of the critical need for business strategy to ‘meet and mingle’ with technology strategy. In a sense MDM technology is a conundrum. The technology should take a back seat to all of the non-technical activities, objectives and requirements for MDM implementations. But technology can also be a game-changing component of MDM initiatives.
Now, on to the ‘Next Age of MDM’!
Image source: nicholaspetrie.com
Julie Hunt is the editor of Hub Designs Magazine and co-founder of the Hub Designs MDM Think Tank. Her “day job” is as an independent B2B software industry solution strategist and analyst. She provides consulting services for vendors to help develop successful strategies for buyers, customer and user experiences, solutions, go-to-market, and future direction.