When managing a business entity, you most likely use several separate systems and applications. All the data you receive across divisions, departments, and organizations are shared in these applications. It is very easy for the data shared to be duplicated, out of date, and even fragmented due to these systems.
In moments like these, you’ll find it difficult to answer what could be the most basic questions about your business and its growth. This is when master data management comes in. In this article, you’ll learn more about master data management, what it is, and how it is done.
What is master data management?
As there isn’t a fixed master data management definition, it’s best to describe it as a concept. Every company has its set of rules, which are made to cater to its marketing, sales, and operational strategies. With master data management, you’re able to manage, organize, centralize, categorize, synchronize, and enrich all the data produced from these sectors for higher productivity.
Many companies have adopted MDM because of how supportive it is for all business initiatives, as the identification, linking, and syndication of information through MDM help eliminate all data silos.
How does MDM work?
There are three major phases in the MDM process: the creation, synchronization, and syndication phases. To implement a great MDM program, you’ll have to do more than create and run the needed applications.
The creation phase is iterative, and it begins with an analysis of the structure of all reference data. Based on the analysis, the application then designs and builds an accurate master data index application, which helps in the organization and matching of all data.
The synchronization phase involves propagating all data collected during the creation phase in external systems. These systems must be configured to accept your data. Thus, they can involve some methods such as web services like Java clients and JMS topics. In this phase, all data kept is up to date and consistently updated automatically.
In the syndication phase, your MDM application is already running, and this means you can decide who gets to see the information and how what they seek should be presented. The last phase removes any complexity of data searches by providing a single access point.
What are the benefits of master data management?
There are many benefits of master data management, with some of them described below.
It helps improve data quality.
Data becomes usable with MDM because the application doesn’t only streamline data, it eliminates all bad data. Users of MDM deal with data that’s up to date and of higher quality, making it highly usable.
It helps prevent data duplication.
One of the biggest issues related to decentralized data applications is redundancy. With redundancy comes data duplication, which creates a lot of confusion in operations, resulting in many errors. With MDM solutions, your master data is compiled into a single data source, which increases the efficiency of your business processes while eliminating all duplicated data.
It helps reduce time and cost.
Technology has evolved over the years, which ultimately means an increase in the volume of data. Without MDM, managing all the data can be challenging for the companies and will demand a lot of time and monetary resources to process accurately. MDM applications are automated, which means all data management processes are done in record time. The speed of data automation reduces data management and processing costs, which means there are more resources for other business needs.
All in all, master data caters to all information sources that feed your business and could take the form of a supplier, product, customer, location, or even an asset, provided you receive the needed information to keep your business entity running and highly profitable.