Master Data Management (MDM) is a key foundation for trusted data and core business processes, says Johan Jurd, MD of InfoBuild, representing Information Builders in SA.
It covers almost every important activity in a company.Using this data strategically can differentiate companies from their competitors.
Overall, how well an enterprise manages their master data is areflection of how well it operates and achieves its objectives, and how quickly it can respond to change.
Executive sponsor missing in action
The worst possible way to start a master data management (MDM) initiative is failing to recruit a senior executive from the business to act as the champion or sponsor.
The programme will require a sponsor who is actively involved in its progress. MDM changes howdata is managed and business processes and practices. This type of change can be disruptive and filled with political landmines. Therefore, involvement from the top will help ensure the project will preserve its momentum.
Lower and mid-level managers don’t have the clout or political standing to bring about large-scale organisational changes over a sustained period of time. Another temptation is to think that MDM and data governance are technology problems, best handled by IT. This is incorrect. The business must be the “navigator” that charts the course of IT.
Skipping the business case
Firstly, you need to answer the question “why are we doing this?”. The business case should tackle the company’s bigger problems. By solving significant issues and achieving positive impact, it will open the door for expanding master data management into the future. It will be easier to connect master data projects to corporate strategies, goals and objectives.
Business users know how data is used in company processes. It is important to spend some quality time talking with them. If the most urgent problems and user needs are knot known, or how to quantify the benefits of MDM, follow the “Five Whys” approach.
This means that when your users complain about a data quality issue, ask “why”. Listen to the answer and ask “why” again. Continue until you’ve drilled all the way down to the root causes. Then, ask questions about how much the issue is costing the business.
Don’t forget to involve IT when building the business case to make sure that the solutions being proposed are well grounded.
Setting up MDM as a “big bang” initiative
A successful MDM initiative is a continuous balancing act between strategic and tactical levels. The first MDM project shouldn’t be started with a scope so large that it cannot be completed quickly and effectively. An impossible-to-achieve scope will make it difficult to show timely value.
Start the project with initial objectives aligned with near-term goals. The initiative should be designed to adapt and meet future needs that may be anticipated right now. If a master data programme is created, solely as a short-term project and only covering the starting point, it will not have the correct elements to support strategic business value or future initiatives.
Don’t ignore the complexity of the MDM programme. The project will involve data and businessanalysis, consultations with business domain experts, data profiling and remediation processes, data integration, entity resolution, third-party data enrichment, and related processes and technologies.
Data governance policies and procedures will need to be created and set into motion. Also don’t underestimate the project’s complexity. The correct resources need to be introduced at the right time.
MDM planning should include many what-if scenarios, including possibilities for future corporate directions and scalability, potential new markets, strategic acquisitions, new customer segments and new and unexpected data sources.
Failing to plan for organisational and cultural change
The project will quickly be in trouble if no preparation is made to handle cultural and organisational changes and the inevitable corporate politics that stem from master data projects.
Part of master data management involves reducing business and data silos while consolidating and standardising master data. Addressing data silos requires examining cross-functional processes and data ownership, which introduces new organisational and departmental challenges.
Stakeholders, constituents and influencers are all critical to the success of an MDM project. Communicating with each group and providing the necessary education will prove invaluable over the long-term, since this can make or break the initiative. As part of the MDM programme, also conduct a marketing and communications programme that targets customers and partners.
Categorise stakeholders and constituents in order to understand what communications each should receive and the best way to deliver that information. Identify the people that are impacted byspecific aspects of the MDM project, as well as who might be a problem. A well-constructed communications strategy, with continuous engagement, can improve transparency and organisational change.
It may be human nature to resist change but don’t make the mistake of discounting that resistance. In many cases, there are real reasons behind the fear of change. It is important to discover, understand and correct the real problems related to concerns about the MDM initiative.
Taking a one-dimensional approach
If a one-dimensional approach is taken, such as stressing technology improvements over organisational change and redesigning business processes, the point has been missed. A successful MDM initiative is a balanced endeavour to provide key infrastructure and organisational change for the data-competitive enterprise. To do anything less can spell disaster.
A one-dimensional approach may be the result of thinking that MDM is all about the technologyplatform. But, the technology cannot be introduced until there is an understanding of the people, practices, processes and politics, as they relate to the MDMproject.
Without that understanding there will be a lack an integrated vision of the impact of master data across the enterprise. Leaning solely on technology ensures the needs and requirements of the business will not be met. The master data programme also has to involve cross-functional teams and requires solid collaboration between the business and IT.
Underrating the importance of a data governance group
A business cannot become a data-savvy organisation that relies on timely and reliable data without implementing data governance responsibilities, practices and processes. Managing master data and data quality are dynamic processes that require constant monitoring and change to reflect the challenges and goals of the enterprise.
Any master data initiative must keep up with business change if it is to provide the right value now and in the future. If a plan for establishing data governance is not created early on, be prepared to face serious obstacles as the project progresses.
The lack of a data governance plan will also impede the growth of MDM initiatives. Data governance aligns the important elements of people, practices and processes that make or break MDM projects. It is the pathway that connects these elements to business strategies, goals and objectives, and to the technologies that support master data processes.
Lack of planning, preparation and establishment of data governance also makes the MDM initiative vulnerable to organisational politics that could hinder or even stop the initiative. Data governance is instrumental for setting up and managing business-IT partnerships. These are critical to MDM’s success and to the cross-functional collaboration that underpins master data processes.
No metrics for measuring success
Without agreed-upon performance metrics, the question, “Are we there yet?” will never be answered. There needs to be a measure of return on investment (ROI). Corporate management and stakeholders expect to see quantifiable results quickly.
The metrics should measure how well goals are being achieved. If the goal is to provide reliable customer data relating to sales data, then the metrics should be based on customer retention improvements or the successful completion of cross-selling opportunities.
A lack of ROI indicators will likely dry up the business sponsorship. There needs to be clear measurements to evaluate whether the initiative has been successful, was itcost-effective and was the expected value delivered. If it cannot be measured, it cannot be managed. Stakeholders need to see value.
Relying on the wrong technologies
There are so many ways to get off track when it comes to choosing the technologies needed to support an MDM initiative. You may think the technologies you already have in place are enough, without really knowing if you have the tools you need to be successful. You might decide to select tools on a piecemeal basis.
But if you do, you could end up with a stitched together patchwork of poorly integrated technologies.