Over the last few weeks (more like months), I have been noticing a trend, which some of you may regard as a Bart Simpson “Duh!” moment, but give me some latitude to explain nevertheless. The global trend that I am talking about is the emerging need for master data definition, acquisition, and management in industries beyond the typical ones of financial services and retail.
Many of these new industries tackling MDM projects(e.g., travel & transportation, heavy industry (i.e., steel, mining), CPG/distribution, pharmaceutical, telecommunications & media, and upstream oil & gas) always knew they had a data problem, but for the first time, it is not just one or two market leaders tackling this challenge, but a vast majority. Also, it is interesting to note that they are not just implementing a single domain (typically product) but are taking on two or more domains, like location, channel, supplier, and even HR (i.e., employee, contractor). This makes sense as many of these industries are B2B-focused, so the need to obtain a single view of their customer is less of a priority, since there customers are well known and do not fluctuate much.
Many of the B2C industries like hospitality, air travel, telecommunications, and a few others, have already implemented MDM programs although they did not call it MDM. For example, telecommunication operators called it “Subscriber Data Management”, which had a slew of limitations as I indicated in one of my older postsThe hospitality and travel industries typically rolled their MDM projects into a customer loyalty index program associated with data warehouse-centric functions such as segmentation for campaigns. In oil & gas or mineral exploration, the ERP system was typically the home of production quotas and delivery commitments and acted as the MDM application. Overall, these were all very narrowly focused on a couple of business processes and typically a single domain or an underlying application.
The B2B industries that I mentioned above are focused on mastering data other than customer such as new products, service items (i.e., warranties, production commitments, SLAs) and equipment based on a location, project, and human resource view. To do this successfully, they need deep hierarchy and relationship management capabilities as well as flexibility, as these areas change frequently. With a flexible MDM approach, you can quickly create new projects or tasks, add a new product or part derivative from an internal or 3rd party managed inventory, link it to regulatory oversight standards (often unstructured submissions to the FDA and alike), relate an employee or contractor based on availability, proximity, or skill set, and associate locations for customer-centric billing, internal, or regulatory accounting roll-ups, or repair operations. A product(ion) centric use of MDM enables you to allocate capital assets, parts inventory, and staff more efficiently while ensuring financial roll-ups are in line with business and accounting standards.
Why did this wave of non-traditional MDM industries suddenly become interested in MDM? Nobody knows, but I suspect that MDM has become mainstream because of the amount of coverage from analysts, trade magazines and because IT staff change industries and bring with them the lessons learned from their banking, insurance, and retail employers. I also believe that software vendors have improved their messaging and delivery capabilities to cater to industry-specific use cases and common objections to new technologies. Lastly, with the economy picking up and the need to digest recent waves of acquisitions and break down resulting data silos, CIOs want to be more prepared for the next round of takeovers. As some economies are still struggling to get out of the “Great Recession”, others may be poised to generate organizations outfitted with cash and an appetite to expand overseas.
As you expand your business and assess your current use of this important corporate asset – your data – do you see a need to make it more productive instead of allowing it to become stale information? Big Data will certainly play a part in this massive expansion of internal and external data (on the cloud or on premise), but its linkage to MDM will give it the needed structure and rigor to be efficiently put into productive use.
I would love to get your thoughts on where we are going next in terms of new use cases and industry focus in MDM. What do you think?