Companies Say MDM Can Improve Business Process, Performance

Loraine Lawson
Slide Show

10 Critical Myths and Realities of Master Data Management

Prevalent myths surrounding MDM alongside an explanation of the realities.

When organizations talk about the benefits of master data management, the focus is usually on the data and improved business intelligence.

 

But now, organizations are starting to cite a different reason for investing in MDM: improved business processes and better performance management. In a recent Gartner survey of 300 end-user organizations attending the research firm's MDM Summit, 49 percent said process improvements are the key business priority driving interest in MDM.

 

It can be a bit tricky to understand the connection between MDM and business process management (BPM), which is what is really being discussed here. The TechTarget article covering the Gartner findings provides this example:

Suppose that HealthNow decided to outsource its claims processing business but still wanted to maintain complete control of its data for security and regulatory compliance purposes. A comprehensive MDM program would make it easier for the company to make business process changes around the claims processing operation.

The piece further complicates the discussion by adding how MDM and BPM impact CPM - corporate performance management - which I'm 95 percent sure used to be called business performance management. That's a lot of expensive, heady, three-letter acronyms.


 

To be fair, this is cutting-edge stuff, here. So if you read all that and think, "Wow, we're nowhere near that point," you're not alone. Few organizations have mature solutions in either MDM, BPM or CPM and even fewer organizations have all three in place, Gartner notes.

 

In fact, as BPM expert and Column 2.0 blogger Sandy Kemsley pointed out in an interview last fall, vendors are just now exploring how to support integration between MDM and BPM.

 

Still, you can see how it might work. After all, it's bound to be easier to change and manipulate the processes once you've pulled out and secured the data in MDM's separate "safe" house. Plus, on the technology side, MDM encourages consistent data models, which makes BPM easier in the long run.

 

For more on how BPM and MDM work together, and how that impacts data integration, check out my October interviews with Kemsley:

 



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Jul 22, 2011 11:16 AM Jim Walker Jim Walker  says:

Hello Lorraine, 

This is a great post.  I would add that MDM as a technology stack or as a solution redefines itself every year and a half. 

I have seen MDM over the past six year snowball technologies. When I first heard of BPM about three years ago, it was the year after Data Governance became the big word in MDM. How natural?  If I knew these BPM technologies existed and I was a betting man, perhaps I could have prophesized and monetized the adoption of BPM as part of a MDM practice.

Data Governance has become the cornerstone of any successful MDM practice.  It defines the people, process and technology of the MDM project.  Successful orchestration of these key aspects requires enforcement and guidelines for the critical processes that govern the data.  Hence, BPM is a key enabler of data governance and in turn... MDM.

Ultimately, MDM provides the master data and BPM provides the master process. A complete MDM practice will use data integration and modeling.  It will augment and improve the quality of the data and will allow you to model and master multiple domains.  These requirements are now extended to provide the guidelines for the process around your master data through BPM.  They share a responsibility and in certain context can no longer be considered separate practices.

No wonder people think MDM is such a huge project.  Well, it doesn't have to be.  The technology doesn't have to be so complex and every MDM vendor is pushing integration of the entire functional stack. Careful what you buy however, it might just be the emperors new clothes.

-Jim Walker, Talend

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Jul 22, 2011 12:22 PM Mark Troester Mark Troester  says:

Hello Lorraine -

It's also interesting to think about BI and analytics in the context of BPM and MDM (or the greater data management discipline).

We are finding numerous use cases where customers are integrating analytics into their operational systems. For example, hospitality scenarios where guest service systems are leveraging rich analytics in real-time can greatly enhance  the customer experience and drive more revenue. The organizations can analyze customer behavior in real-time and provide highly relevant offers as the guest leverages the various hotel properties. From a data management perspective, some of these organizations are using master data management to provide a consistent view of a patron to tie together the multiple patron touch points.

On the financial services side, operational systems that relate to trade activities, credit card swipes, loan approval processes, etc., have been integrated into the analytics system in real-time, greatly reducing fraudulent transactions and risk.

We are also seeing data management and process initiatives positively impacted by rich analytics. Instead of using standalone data management tools, data management capabilities that leverage advanced analytics to analyze the data to help drive and automate data quality, data integration and MDM work, greatly simplifying the data management effort. On the process management side, leveraging rich analytics to optimize complex business processes in real-time is an interesting trend.

Thanks for addressing this topic!

Mark Troester

SAS Institute

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