Master Data Management (MDM) is a discipline which aims to deliver consistency and accuracy of an organisation’s shared data sources. As a discipline it has two aspects: technology and governance. Whilst these two aspects are intrinsically linked, in order to clearly answer the question “What is MDM”, we will first look at them in isolation. Always remember, you require both aspects, tech’ and governance, to practice good MDM.
Before we start, let’s first establish what is meant by ‘data’. Data means many things to many people. At rascal we specialise in MDM for retail, so ‘data’ for us can be split into three broad categories:
- Master data: The key unique identifiers that relate to the object in question. In retail this might be a product SKU code, or item barcode. These data points create a unified single view of the object.
- Reference data: The associated attributes that describe the object in question, such as product dimensions, VAT rate, etc.
- Transactional data: The data that relates to the business-critical activities associated with the object in question. In retail this might be price adjustments, promotional activity, margin integrity.
In retail the most common application of these data sets relates to the Product, and is referred to as Product Data Management (PDM). However, an over-arching MDM strategy seeks to cast the net wider and blend this product data with other data sets the organisation holds, such as customer data (CRM; Customer Relationship Management) or supplier data (SIM; Supplier Information Management).
Every organisation holds data in one way or another, but it is seldom held in one central location. Often, the data is physically and digitally scattered around in various applications, spreadsheets, and even physical media such as storage devices and paper. Sound familiar? MDMs first objective is to provide technology that allows the organisation to pull these scattered data sources into a single shared framework. Once in a single location an organisation can identify which data points it trusts to be the most accurate; creating the Golden Record, or Single-Source Of Truth (SSOT) from which all related data points can be set.
However, remember this is only half the picture, we still need governance. Investing in MDM without governance is like buying a car and never having a service or MOT. It will fail. Good data governance sets the standard across an organisation for how data is handled, implemented, maintained and managed. Technology can help with this: MDM solutions such as rascal’s allow organisations to set automated rules and error identifiers that prevent inaccuracies in the Golden Record. Poor governance increases risk and the likelihood of errors which can be costly, especially if it compromises the data being used to make business decisions.
With both technology and governance in place, an organisation can place trust in its internal data sets, in turn this can be passed on to partners, suppliers and customers. In today’s world is there anything more reassuring than a supplier you can trust, or a customer you know is loyal? MDM is the cornerstone of these relationships.
This article is part of a series aimed at demystifying the sometimes-complex world of Master Data Management. At rascal we work hard to avoid jargon and make our approach as clear as possible. To discuss how we do this, or to suggest a topic you think needs clearing-up, please click here to get in touch.