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Master data management isn't one size fits all

Master data management has growing interest, but it's not meant for everyone. Use these tips to determine if it's right for your SMB.

Typically used in larger organizations, master data management (MDM) can also benefit small and medium-sized businesses (SMBs). While the MDM acronym may be new, the concept of managing comprehensive data in a strategic way has been around for decades in companies of all sizes. The recent growth of service-oriented architectures and systems integration, though, has brought back into focus the importance of MDM.

Master data management is not one size fits all, however. Here are four points to consider when deciding if MDM is right for your SMB:

1. MDM -- just what is it all about?

Data is located in remote parts of your organization. Mastering the management of that data means consolidating the information into one master file and leveraging it. In this sense, MDM is a concept, not a technology or product itself.

Data about who is buying your products -- customer information -- likely resides in myriad locations, for instance: marketing departments, sales departments, different sales channels, finance and even accounts payable. Information about the products themselves -- such as parts, parts vendors, inventory, costs and sales -- also likely resides in dozens of disparate places.

"MDM is a technological and cultural approach to managing all of this information in a centralized and holistic fashion. Just imagine the efficiency and value of tying the appropriate data points together from the service, product and customer records," said Lance Osborne, custom data integration solutions leader at Little Rock, Ark.-based Acxiom Corp.

2. MDM is not likely to work if your data is out of order.

Peter Aiken, an information systems professor at Virginia Commonwealth University and a researcher on enterprise data, notes that only one in three organizations are confident in their own data, and only 18% are confident in data received from other organizations, citing 2004 research from PricewaterhouseCoopers LLP in New York.

This lack of confidence is a death knell to a successful MDM implementation. Aiken contends that getting your house in order is essential before letting a master data management consultant in the door or purchasing a newfound product aimed at integrating all of your systems into one utopian, efficient enterprise tool.

Once you understand your data's architecture, you can identify where it's coming from, what it contains, how reliable it is and what you can do with it.

View your data as an asset, not a nuisance. Look at the condition and structure of your data, and you will be well positioned to understand how far you must go to leverage it.

3. Make your data accessible.

Within any organization, there are unwritten rules concerning data ownership. Failure to realize this could pose problems in managing data for long-term enterprise gain. Often, this is the biggest obstacle to implementing MDM.

"The technical challenge, of course, is in both integrating all of the different software applications that generate and house the information, and ensuring that the data is always effective, up-to-date and of value to the business," Osborne said.

For your data to be of the greatest possible use to the most number of people in your organization, departments and subcultures within the organization must be willing to share information. While it sounds like a no-brainer, it is often one of the more difficult obstacles to overcome in making a data management strategy work.

4. Know your end game before you rush to implement master data management.

Assessing your data architecture, improving its quality and using technology to link it, access it and spread it throughout your enterprise are essential to making your data a strategic asset. A comprehensive data strategy, however, also requires specific goals and objectives.

Ask yourself, "What is it I hope to achieve with master data arrangement and access?" Is it more accurate cost predictions? Zero defects? Better business intelligence? These are all viable objectives that MDM can help you achieve.

Remember, data is an asset. Using it to reach organizational objectives and fulfill strategies positions is what makes MDM such a valuable tool

Jim Romeo is a freelance writer who focuses on business and technology. Contact him through his website at www.jimromeo.net.


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