Consistent, complete, and valid data is what most articles about master data management (MDM) consider as the result of a proper master data governance in place. But Synopps master data management program’s outcomes show that it’s only a start, just the most obvious benefits for business. There are also not-so-obvious positive sides to implementing a well-designed and coherent master data strategy. Below we’ve listed five of them.
First, a couple of words about what a master data program looks like and how it brings those — the obvious ones — results.
In brief, it does master data cleansing to remove duplicates and outdated records and enrich data to make them complete. Then it organizes them in a way to make it easy to input, delete, transfer, store, and renew the records. And, finally, it structures them in a fashion to reflect a company’s strategy and specifics — business unit, operations, geography, etc. Eventually, you end up with an information system that contains valid and applicable master data as opposed to having a massive amount of overlapped records distributed across many domains in different formats, often non-convertible.
This well-organized data is of value in itself. But further, it brings a lot of pleasant surprises by transforming various aspects of the company’s practices.Also read: What Is Gaming In Metaverse? 7 Best Metaverse Games To Try (#1 is played by millions of YouTubers)
Sometimes the benefits of MDM are rather subtle and not always tracked and measured, but do exist.
Increased customer loyalty. The better you know your clients, the more value you can give them. Refining master data from duplicates helps you understand the exact number of customers the company has. Securing completeness and consistency of this data helps uncover who the customers are, where they live, and what and when they bought or continue to buy. The rest — we mean how to use this data in the best manner — is up to the company’s marketing staff.
Increased employee loyalty. Messy data is an emotionally exhausting thing just like any disorder that wastes time when you try to find or do something. Preparing even a simple report requires data. But what if you need to spend a lot of extra time to collect this data, then refine it from duplicates and verify — with limited success as you cannot be completely sure that what you have got is right? For example, are Mr. James Stockton and J. Stockton from two different databases the same person or not?
MDM saves staff the reasons to get nervous when handling master data, let alone savings in time.
Reduced reputation risks. When we write “inconsistency” we mean that different databases of a company’s units may have different records about the same object (see the example of Mr. Stockton(s) above). It’s OK if both or three of four versions of data are right, just written differently. But what if only one of them is right? And what if the wrong one would find its way into a corporate report to be submitted to a regulator? A check by the regulator would uncover the error which could lead to a fine and damage to reputation in case the failures would be reflected in mass media headlines.
Save money. Cost cutting comes through a clear picture of purchases. Messy data can only provide a distorted picture as the same item of purchased supply is registered numerous times across multiple domains. For instance, information on a piece of equipment is contained in production, logistics, maintenance, and financial departments. If the production is divided into a few units and each unit has its own database and budget for purchases then monitoring and analysis are even more difficult to do.
But how can a clear view achieved through a master data program help here? Yes, it will not automatically reduce costs, and further actions are needed. Typically, there are two ways to enhance cost efficiency. The first is through getting a discount in exchange for volume. That’s where MDM is of assistance as it gives an exact volume of purchased supplies. The second is through the elimination of excessive stocks. In the example above, different production units buy the same goods or services and don’t coordinate their efforts. As each unit seeks a bit excessive stock to prevent a possible shortage thereof, the accumulated stock turns out to be too much for current operational tasks. Getting a saving here seems to be a rather easy challenge to tackle.
Industry leadership. Of course, even a superb architecture of master data and well-written and well-accomplished instructions doesn’t instantly make a company a leader in its industry in terms of turnover, market share, and profitability. But regarding transparency of business, it’s really possible to lead the hit parade and get applause from the stock market, investors, and potential partners. Just one (and big) plus to the reputation.
These are five factors that lie on the surface. The practice of Synopps says you can achieve even more depending on the specifics of your business.
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