In today’s always-on, hyperconnected, hyper-personalized world, data has become the epicenter of digital transformation. It is the fuel that not only accelerates the adoption of digital technologies but also enables their optimized application to swiftly reach the targeted digital-native by ensuring minimum roadblocks.
As a result, nimble data-driven businesses that are modernizing digitally with high-end data practices, are invariably steering with a larger competitive advantage. One of their secret sauce isa well-articulated and executed Master Data Management (MDM) strategy. That is because, all the elements of digital transformation such as preventing data hoarding by departments, creating interaction between systems, lowering costs of data management, diffusing discord between teams over data collaboration are the basic building blocks for effective MDM implementation.
What does it entail? Or in other words, what is Master Data?
Master data is the data that matters or the core data for any business. It pertains to all the entities of a business including customers, products, services, vendors, partners, brands and sub-brands. It is often widely shared across multiple systems, applications, and processes. An MDM system not only enables the streamlining and sharing of this master data but also lays the foundation for future technological advancements by truly delivering measurable data-led benefits.
Here’s how MDM paves the way for digital transformation for your enterprise:
- Preparing an Environment for Digital Transformation – Digital transformation requires all systems to communicate seamlessly. That means, the data used by the production team should be accessible to the sales team to innovate and develop new collaterals. Processes should run in parallel with different teams working under the same data umbrella and using APIs as a language to communicate with no space for disparity. To enable that, an environment is needed to supplement digital transformation with more data, advanced analytics, streamlined processes, and intricate architecture. An MDM implementation can create that exact environment with a ‘golden record’ – a single source of truth for different collaborators to access, manipulate, and leverage data efficiently.
- Improving Data Quality – Being crucial for intelligent decision-making and being the input to all business operations, the quality of data cannot be compromised in the digital transformation journey. To ensure there is no ‘dirty data’, MDM gets all the systems on the same page. It creates data consistency and mobility and ensures that the enterprise has a sound enterprise architecture. This is even more crucial for rapidly growing enterprises since more silos are formed and more application stacks are piled up as the business grows. These multiple silos inevitably create disparate data as the unwanted side-effects of the progress. Without a master data strategy, there is no way to tame the disparate data across the enterprises. And since your key data is in a central location, you’ll have a better understanding of your overall inventory.
- Introducing Data Governance – Digitizing, in its most basic form, provides a wealth of information. Be it for customer services, human resources, marketing, sales, or product development, digital transformation tends to open the flood gates and data pours in from every nook and corner. But handling this sudden data-stream cannot be a reactive process. Businesses need to prepare beforehand with purpose-built canals to govern the flow and ensure optimum consumption without overwhelming people, tools, and processes. MDM can lay the foundation for this flood control by stewarding data access with policies to access, secure, and take advantage of information as an enterprise asset. It can help businesses handle new and complex data types with standardization, computational power, and analytical infrastructure.
- Inculcating Data Literacy and Ethics – As the physical world merges with the digital world and data is generated by every appliance from traffic sensors to heart rate monitors, enabling rich data ethics and literacy is a business imperative. Data handling needs to be agnostic and consistent to avoid biasness, discrepancies, and limitations in its application. Businesses must be able to do an apples-to-apples comparison of information across geographies, subsidiaries, and software systems to truly embark on the digital journey. A sound MDM strategy can build the perfect enterprise architecture to tackle this ever-increasing data speed and complexity. Acting as a centralized hub, it eliminates the need for point-to-point interfaces and allows systems to communicate with only the hub instead of numerous siloed systems. This provides more control and protection for vital information while bringing together data providers, aggregators, and consumers in a seamless mechanism to share and consume data with governance, security, efficiency, and trust.
- Laying the Foundation of Data Analytics – Data architectures play an important role in enabling analytics with access to clean, formatted, and secure data. While data analytics build insights from pattern recognition, historical data manipulation, reverse engineering from use cases, and other algorithms, it is dependent on data references like entity-relationship diagrams and dashboard representation of inventories. Since MDM includes complex hierarchical and multi-dimensional data categorizing core objects of the business – it acts as the perfect setup for analytical or reporting purposes. The dynamic view of master data can enable probabilistic inference of data characteristics, which leads to profiles rather than records. It can help extract actionable information and improve critical decision-making. For example, MDM-powered analytics can help customer-facing brands get a richer view of a customer’s product portfolio for mass personalization and pricing.
The Best Route For A Digital Transformation Journey
To get to a better, more productive, and more connected state, enterprises not only need to transform digitally but do that in the best way possible. Implementing a well-thought Master Data Management (MDM) is the first step in that direction. It provides a 360º vantage point for a horizontal view of all the relationships across the entire enterprise. From overcoming internal roadblocks to sharing data systematically to smoothening the creases in legacy infrastructure for future changes – MDM is the key to leverage data, new applications, and data sources. It is the critical component of a modernized data strategy required for digital transformation.