Just the Stats: Master Data Management

Loraine Lawson
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Six Steps to MDM Success

Steps you should take before embarking on a master data management initiative.

Master data management (MDM) is quickly becoming a must-have, particularly in regulated industries. That's in large part because MDM is tied to effective information governance.


MDM is a way to create a clean version of data by bringing it into one hub and reconciling any differences you find. It's usually used for key data like customer, product or financial data.


The goal is to create a "golden record" of this data, which can then feed all your business systems, from ERP to analytics. Ideally, MDM is an enterprise-wide discipline or program that includes data quality and data governance.


"An MDM program is not a project but a commitment by the business to leverage information for reuse in order to improve business process outcomes," Andrew White, research vice president at Gartner, said in a press release.


But how well are organizations really doing with MDM? Let's look at the stats on MDM.


The Good News:

Most organizations already have some form of MDM. TDWI recently surveyed 369 companies about their MDM use. Of those, only 8 percent said they don't practice MDM anywhere and have no plans to do so. Another 2 percent just said, "don't know." The rest?


29 percent. Are planning to start MDM.

17 percent. Practice MDM as an enterprise-wide, unified discipline.


Also, more companies are moving forward with MDM in a variety of data domains.

47 percent. MDM professionals out of 274 surveyed by Forrester Research who said the scope of their MDM programs include more than two data domains to master.

9 percent. MDM pros who say they're focused on dual-domain solutions (e.g, customer and product).

37 percent. Organizations were serving multiple data domains with one MDM solution, according to the TDWI survey.


It related good news, it seems organizations will be investing in MDM, big time, over the next three years.


$1.9 billion. What software revenue from master data management (MDM) is expected to be in 2012, according to Gartner's predictions. If the research firm is right, that will be a 21 percent increase over last year.

$3.2 billion. What Gartner believes MDM software revenue will be in three years.


The Not-So-Good News:

I mentioned the good news that most companies practice MDM. But the not-so-good news is that even though they're doing it, they're doing MDM in silos, which kind of defeats the point.


44 percent. Out of the 369 surveyed, most have an MDM, but it's done in silos per department, data domain or application, according to TDWI.


The stats aren't so sunny when it comes to how effective organizations are at MDM, either, which brings us to


The Bad News.

75 percent. Enterprises that don't have an effective master data management strategy, according to Jane Thomson, executive director of EOH.

33 percent. The few organizations that Gartner predicts will manage, from now until 2016, to initiate an MDM program AND demonstrate the value of information governance - which leaves a lot of organizations on the flip side of that prediction.

20 percent. How many CIOs in regulated industries Gartner predicts will lose their jobs by 2016 because they failed to succeed at information governance.


So, there's progress when it comes to MDM, but it looks like a hard road, with a lot of mistakes and consequences if organizations don't get serious about approaching MDM as a program, rather than simply a technology. Remember what White said about MDM? Here's the critical rest of that quote:

The real barriers to MDM adoption remain ones of change management, governance process, organizational change and measurement of business value. The creation of effective governance organizations, policies and processes that focus on the master data life cycle is key to success with MDM.

Sure, that sounds like a major headache and a ton of work, but the stakes are high. Good luck.

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