Master data is defined as the key business data such as customer, product, supplier which are needed for day to day operations. Master data is shared across many business domains. Transactional data does not alter Master data definitions, and Transactions such as Order Creation, Invoicing and Billing cannot be performed without master data. The definition of Master data is subjective. Each enterprise should be free to define master data depending upon their Industry, division and nature of their operations. For example: Product may be considered the master data of a Manufacturing enterprise, but to a Service Consulting Firm, Employee Skillset may be their definition of master data.
Why enterprises need MDM – the Top reasons
No single source of truth. Master data is updated by different source applications such as CRM,
ERP, Billing and so forth, whereby multiple versions of same data are stored across different
silos by different business units Duplicate versions of the same data are stored by enterprises. According to TDWI, data duplication costs enterprises US$ 600 billion annually. In fact 20% to 30% of enterprise data records are duplicates. Inconsistent customer and product hierarchy- this affects financial reports, loss in upsell and cross sell opportunities, derails targeted sales campaigns Inconsistent reporting and analytics resulting in poor business reports, affecting financial
projections, directly affecting key business decisions Sales and finance data do not reconcile, impacts closure of books, increases risks of violating compliance and missing opportunities Numerous applications perform the same operations across different Business Units, burdening the IT infrastructure team Multiple powerful and expensive servers with high capital and maintenance cost are needed without Cloud MDM Compliance and governance rules are unable to be enforced Master data is not secure, data is accessible and editable by any one Uniform Data standards are unable to be enforced Information management is lacking Unable to use social media analytics and trend about a customer due to bad data
Types of data
There are many kinds of data such as: Transactional data
Reference data and
Master data acts as the foundation upon which all the above types of data and their many sub-divisions depend upon.
Master data is essentially the information asset of an enterprise
Out of all the above kinds of data, master data is the key. It is the foundation without which a business cannot operate. Other types of data depend upon master data. If master data is inaccurate it has a domino effect and taints the data in every domain that it touches. Without Master data, transactions are not possible. Master data is essentially the information asset of an enterprise. Therefore in order to create and maintain its business edge, a business needs to successfully manage its master data. In my next paper, I will talk about the common causes for MDM project failures and how iClassic MDM is specifically designed to overcome them.
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