What is Master Data Management?
In this article, we will discuss Master Data Management in detail.
Master Data Management Program – A brief introduction
Master data management (MDM) is a method that helps businesses to manage their important data well, by enabling them to link this data from multiple systems to a common reference point. When an organization implements master data management programs well, it sees a noticeable improvement in enterprise data quality.
An effective MDM implementation also enables various stakeholders in an organization to share data seamlessly. This overall improvement in an organization’s data quality and ease of sharing results in improved enterprise data management and processing in their IT systems. You can read more about MDM in “master data management (MDM)”.
Why does Master Data Management matter?
Businesses typically use the term “Master data” to refer to the following data elements:
- Reference data, i.e., permissible values in other data;
- Customer data;
- Product data;
- Employee information;
- Tickets for tracking problems or customer interactions;
- Analytical data.
You can read more about this in “7 examples of master data”.
The importance of MDM is best understood by reviewing what happens when an organization doesn‘t have effective solutions and practices to manage master data. The lack of accurate master data entity results in the following:
- Crucial data belonging to the organization remain in different systems like ERP, CRM, etc., and no effective sharing is possible.
- Different departments and IT systems view critical business information differently, therefore, it‘s practically impossible to gain organization-wide insights from this data.
- Businesses can‘t find answers to important questions like “Who are the most profitable customers?” without proper customer data integration, and “Which products deliver the best profit to us?”.
- Sub-optimal data quality results in a lack of confidence in the IT systems.
The global market for MDM
Estimates for the global MDM market vary, however, they all project a significant growth, as the following reports show:
- MarketsandMarkets estimates that the global MDM market will reach $22 billion by 2023, from $9.5 billion in 2018, with a CAGR of 18.3%.
- Transparency Market Research has projected that the MDM market will reach $17.339 billion by 2026, accompanied by a CAGR of 15.7% between 2018 and 2026.
- A Persistence Market Research report states that the market for MDM will have a CAGR of 11.7% between 2017 and 2022, and this market will be worth $8.6 billion by 2022.
- BusinessWire estimates that the global MDM market will grow from $1.6 billion in 2018 to $3.4 billion by 20204.
What should a robust MDM solution offer?
When shopping for a robust MDM solution, you should look for the following capabilities:
- The solution should enable master data matching and linking.
- Data consolidation is a key feature of any good MDM solution.
- A robust MDM solution should enable the mass processing of data.
- Such a solution should make the data easily sharable.
- Data security is important, therefore, a good MDM solution should secure data.
- Data enrichment is another key capability of a robust MDM solution.
You can read about these capabilities in “Top 17 master data management software”.
Key MDM players and offerings in the market
The following players dominate the global MDM market:
- Stibo Systems;
- TIBCO Software;
- Riversand Technologies;
- Orchestra Networks;
- Teradata Corporation;
- Software AG.
This is not an exhaustive list of prominent MDM providers, and you can find more MDM players in this Industryarc report.
Popular MDM offerings in the market are as follows:
- Informatica MDM;
- Orchestra Networks EBX;
- SAP Master Data Governance;
- IBM MDM Solutions;
- Reltio Cloud;
- TIBCO MDM;
- Riversand MDM;
- Stibo Systems Master Data Management;
You can read more about these offerings in “Top 10 master data management solutions”.
Master Data Management implementation challenges
MDM can add significant value to your business in the form of customer master data management, product master data management, etc., however, you will likely face various challenges while implementing it. These challenges are as follows:
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- Your business has various kinds of data, e.g., demographic, transactional, interaction, etc. The first step is to scope out your MDM implementation after analyzing these different kinds of data, and that can be hard!
- Many businesses have data in silos since they have operated in silos for long.
- Data quality issues slow down MDM implementation.
- Most enterprises use various software packages for different functions like CRM, ERP, BI, etc. Key data elements reside in these packages, and arriving at a uniform view of master data can be hard.
- Businesses are seeing an explosion of unstructured data, e.g., emails, documents, etc.
- Mergers and acquisitions are common in the business world, and these pose challenges for MDM implementation since two different businesses often store master data differently.
You can read more about these challenges in “MDM primer: the challenges, systems and success factors involved in delivering the ultimate customer experience”.
Planning to Implement Master Data Management
As the statistics mentioned above show that master data management is widely being adopted by businesses for better data storage and streamlining of business processes. If you, as a business CTO, are planning to invest in master data management solution, you are making a sound business decision.
To implement MDM successfully, you will need a skilled team of software developers who are able to understand your technology stack and frameworks.
Read our guide on implementing an MDM solution using blockchain technology.
If you do not have such skilled software developers in your MDM project team, we advise that you partner with a field-expert software development company.
DevTeam.Space can also help you with MDM implementation via its experienced software developers community. You can write to us your initial MDM development specifications via this form and one of our technical managers will get back to you to discuss further details.
Frequently Asked Questions
MDM involves the management of the enterprise’s master data assets. It helps businesses achieve improved uniformity, consistency, and value from the business data.
MDM provides a unified and consistent view of the entire shared business data. This helps analytical and operational processes as MDM collects, transforms, and improves data to build a coherent data view.
Different master data management implementations include consolidation, registry, centralized, and coexistence. Read more detail here.