The most popular and comprehensive Open Source ECM platform
Let us know more
Master Data Managment: Consistency Can Be Costly
Master Data Management (MDM) is a system of reference for organizations which centralizes the location of data so that multiple systems that rely on the same piece of data are always current with the state of the data. MDM seeks to solve the problem where data in one system is updated, but other systems that also rely on the same data aren’t aware of the update and still refer to stale data.
While MDM can save money and improve consistency, setting up and maintaining MDM can be an expensive operation. For some companies the implementation costs run into the millions of dollars. The median number for setting up a system at a large company is $3.5 million — and the average number was $7 million, implying that there are a few installations out there that were pretty costly.
There are two types of MDM: Analytic and Operational. Analytic MDM is concerned with the management of the master data items needed for use with aggregation and analysis. Operational MDM is all about distribution, synchronization and exchange of master data to ensure consistency in transactional operations. They’re not mutually exclusive. Some companies implement MDM to support both analytic and operational flavors, and doing so provides the most benefits. But many companies choose to implement either just one type, with the majority of MDM implementations being operational MDM, although there is no clear winner.
A recent survey found the breakdown of MDM implementations had this structure:
- 23 percent have implemented analytical MDM
- 37 percent have implemented operational MDM
- 33 percent have implemented both
A majority of the companies surveyed felt that their implentations were successes. Good news considering how expensive those implementations were.
