What Is an Example of an MDM?

Master data is the core information that is essential for running every company’s business operations. A company’s master data examples might include customers, prospects, suppliers, physical sites, organizational hierarchies, and basic accounting principles. Master data stands apart from transactional data, which is a company’s daily activities such as sales, accounts payable, banking transactions, and more. While transactional data changes regularly, master data tends to remain more constant.

Typically, master data is maintained in a partnership between the business and its IT department to ensure accuracy and uniformity in data governance topics. Master data governance is the glossary by which terms are defined for consistency: the definition of “customer,” for example, or the rules by which an organization’s accountancy is structured. These governance rules reduce the chances of confusion, misinterpretation, misuse, and errors in doing business, particularly in exceptionally large and global organizations with geographically distributed operations.

What Is a Master Data Management System?

Because consistency of master data is important for business operations, many companies choose to use Master Data Management tools, which are part of a software solution that enables companies to maintain a single view of all master data across the organization for better decision-making and business consistency. Most MDM tools are designed to be integrated with other third-party software solutions that may store some master data: operations rules, for example, or accounting practices.

What Is An Example of an MDM, and Do We Need One?

If your company is categorized as an enterprise, you certainly need an MDM solution, since data management in these large multinational organizations is extremely complex and requires significant oversight by the IT department. For very large organizations, a confusing set of international laws apply to operations, making centralized management of master data critical.

For small to mid-sized organizations, an MDM solution is not always necessary to effectively manage key business data. For a majority of companies that fall into the SMB category, point solutions such as Product Information Management (PIM) tools, Customer Relationship Management (CRM) platforms, and Product Lifecycle Management (PLM) platforms provide more than enough functionality to effectively manage the company’s master data.

This isn’t to say that your organization does not need the benefits of master data management. Proper organization and management of your company’s master data allows you to make better decisions quickly and efficiently. For example, effective master data management will help you speed product development, target your marketing efforts more effectively and provide better and more personalized customer service. Chances are, however, that you can accomplish this without a dedicated master data management system.

What Are the Five Core Functions of Master Data Management?

The process of effective master data management (MDM) provides a variety of benefits, particularly for extremely large enterprises that implement an MDM process and related MDM solutions.

Of course, while there are various ways to implement MDM — with or without a dedicated solution, or with an adjacent solution such as a Product Information Management (PIM) system — the actual process of MDM typically involves five core functions, as outlined below.

A single view of all master data. When all master data is available in the same place within the enterprise, it eliminates data silos, which reduces confusion, results in fewer errors, and increases productivity. With an MDM all employees are working from the same source of information, which leads to consistency in policies and operations as well as customer support. Data management areas can be defined in advance by an organization, with rules built to ensure compliance.

Faster start-up. The process of MDM typically establishes a company’s data governance policies and procedures, which need to be in place before a company begins doing business (or very early in the process).

Improved data quality across the business. Without centralized master data storage, different “versions” of company data may exist across the enterprise. Some of these versions may not be current, and employees are at risk of using outdated or incorrect information to make decisions on business processes or customer interactions.

Easier and more accurate data analysis. As the old business adage goes, “If you can’t measure it, you can’t manage it.” Centralizing critical master data allows companies to uncover opportunities and weak spots, and improve business processes and worker efficiency.

The potential for machine learning or artificial intelligence. These newer data analysis techniques mentioned above often include machine learning (ML) or artificial intelligence (AI). AI can go a long way toward automating master data collection by identifying data fields and field types and simplifying search and navigation processes. The result is a boost in the efficiency of business processes that rely on master data accessibility.

What Is a Master Data Management Example?

There are a variety of Master Data Management companies offering solutions to the marketplace today. A current MDM tools list includes Stibo Systems, Informatica, PiLog MDRM, TIBCO, Profisee, SAP, IBM, Reltio, Oracle, Microsoft, and others. These solutions tend to be large, complex, and expensive and are often unnecessary for master data management for all but the largest multinational corporations.

Smaller organizations are well suited to solutions that keep track of both master data and product information, offering both a place to centralize product data and select Master Data Management fields and tools. While Master Data Management tracks and centralizes all of a company’s important data, a Product Information Management (PIM) solution centralizes product data. Since the functionality is similar, a PIM solution can serve as an MDM in many cases.

In fact, some Product Information Management (PIM) solutions also offer MDM functionality as a feature, including Pimcore and Syndigo. Point solutions such as Product Information Management (PIM) tools, Customer Relationship Management (CRM) solutions, and Product Lifecycle Management (PLM) platforms will provide enough functionality to effectively manage small to medium-sized companies' data.

PIM solutions such as those from Lumavate are already designed to centralize product data into a single source of truth, so it’s easy to use them as the same single source for master data: Lumavate’s PIM solution allows for unlimited custom data fields. And because PIM solutions are business-led solutions rather than IT department-led solutions (unlike MDMs), they are usually more cost-effective and user-friendly. In short, PIM solutions like Lumavate’s are faster to deploy than MDM solutions, require fewer resources to maintain, and deliver business insights faster.

For more information on Lumavate’s PIM solution, take a tour of its functionality or book a demo.