Getting a 360-degree view (or single view) of your customers has been a quest in data management as long as I can remember.
This has been the (unfulfilled) promise of CRM applications since they emerged 25 years ago. Data quality tools has been very much about deduplication of customer records. Customer Data Integration (CDI) and the first Master Data Management (MDM) platforms were aimed at that conundrum. Now we see the notion of a Customer Data Platform (CDP) getting traction.
There are three basic steps in getting a 360-degree view of those parties that have a customer role within your organization – and these steps are not at all easy ones:
Step 1 is identifying those customer records that typically are scattered around in the multiple systems that make up your system landscape. You can do that (endlessly) by hand, using the very different deduplication functionality that comes with ERP, CRM and other applications, using a best-of-breed data quality tool or the data matching capabilities built into MDM platforms. Doing this with adequate results takes a lot as pondered in the post Data Matching and Real-World Alignment.
Step 2 is finding out which data records and data elements that survives as the single source of truth. This is something a data quality tool can help with but best done within an MDM platform. The three main options for that are examined in the post Three Master Data Survivorship Approaches.
Step 3 is gathering all data besides the master data and relate those data to the master data entity that identifies and describes the real-world entity with a customer role. Today we see both CRM solution vendors and MDM solution vendors offering the technology to enable that as told in the post CDP: Is that part of CRM or MDM?
When searching for information about Master Data Management (MDM) solutions you will stumble on a lot of alternative facts.
Here are three more or less grave examples:
The MDM news is filled with yet a new market research report at sale for a few thousand US dollars. These reports look at first hand to be very thorough and information rich. But usually with a closer look you will become suspicious. It may be the mention of key players where often some are missing and a few actually mentioned will be companies more known from other trades. And the structure and content, as in the below example, seems to be a copy paste from other trades. Hmmm… “Production”, “Gross Margin” …. Seems to be more about the global cement market.
Finally, on the pedantic side, even the recognized analyst firms can make a mistake (or a copy paste from earlier years). Forrester places Informatica as a German company. Well, it is the Product Information Management (PIM) wave and Informatica got into PIM (now Product 360 MDM) by buying the German PIM vendor Heiler in 2012.
Nope, there is no such thing as a single version of the truth.
Having been in and around the IT business for nearly 40 years I have seen, and admittedly not seen, a lot. Inflated hype has always been there, and a lot of technologies, companies and gurus did not make it, but came out naked.
What will you say are the emperor’s new clothes within data management today. Here are some suggestions:
Social MDM (Social Master Data Management): The idea that master data management will embrace social profiles and social data streams. If not anything else, did GDPR kill that one?
Single source of truth: The vision that we can have one single source that encompasses everything we need to know about a business entity. This has been a long time running question. Will it ever be answered?
Until now, much of the methodology and technology in the Master Data Management (MDM) world has been about how to optimize the use of what can be called first party master data. This is master data already collected within your organization and the approaches to MDM and the MDM solutions offered has revolved around federating internal silos and obtain a single source of truth within the corporate walls.
Besides that third-party data has been around for many years as described in the post Third-Party Data and MDM. Use of third party data in MDM has mainly been about enriching customer and supplier master data from business directories and in some degree utilizing standardized pools of product data in various solutions.
Using third party data for customer and supplier master data seems to be a very good idea as exemplified in the post Using a Business Entity Identifier from Day One. This is because customer and supplier master looks pretty much the same to every organization. With product master data this is not case and that is why third party sources for product master data may not be fully effective.
Second party data is data you get directly from the external source. With customer and supplier master data we see that approach in self-registration services. My recommendation is to combine self-registration and third party data in customer and supplier on-boarding processes. With product master data I think leaning mostly to second party connections in business ecosystems seems like the best way forward. There is more on that in a discussion on the LinkedIn MDM – Master Data Management Group.
This week I had the pleasure of speaking in Copenhagen at an event about The Evolution of MDM. The best speaking experiences is when there are questions and responses from the attendees. At this event, such lovely interuptions took us around some of the tough questions about Master Data Management (MDM), like
Is the single source of truth really achievable?
Does MDM belong within IT in the organization?
Is blockchain technology useful within MDM?
Single source of truth
Many seasoned MDM practitioners has experienced attempts to implement a single source of truth for a given MDM domain within a given organization and seen the attempt failed miserably. The obstacles are plentiful including business units with different goals and IT landscapes with heterogenic capabilities.
I think there is a common sentiment in the data management realm about to lower that bar a bit. Perhaps a single place of trust is a more realistic goal as examined in the post Three Stages of MDM Maturity.
MDM in IT
We all know that MDM should belong to the business part of the organization and anchoring MDM (and BI and CRM and so many other disciplines) in the IT part of the organization is a misunderstanding. However, we often see that MDM is placed in the IT department because IT already spans the needs of marketing, sales, logistics, finance and so on.
My take is that the actual vision, goals and holistic business involvement trumps the formal organizational anchoring. Currently I work with two MDM programmes, one anchored in IT and one in finance. As an MDM practitioner, you have to deal with business and IT anyway.
Blockchain is a new technology disrupting business these days. Recently Andrew White of Gartner blogged about how blockchain thinking could go where traditional single view of master data approaches haven’t been able to go. The blog post is called Why not Blockchain Data Synchronization? As Andrew states: “The next year could be very interesting, and very disrupted.”
A natural consequence of the concept of Data Quality 3.0 is something we may call Master Data Management (MDM) 3.0.
Master Data Management has in a large degree until now been about how to manage master data internally within organizations. The goal has often been to merge different data silos within the organization into one trusted source of master data. But any organization in itself manages a master data silo too. The master data kept by any organization is in a large degree a description of real world entities that also is digitalized by business partners and other third party entities.
The possibility of sharing customer, or rather party, master data as well as product and location master data was examined in the post Third Party Data and MDM.
But how do popular MDM solutions facilitate the enormous potential of looking outside the implementing organization when it comes to achieving high value master data? Very poor, in general, I’m afraid. From my experience MDM vendors stops at the point of creating more or less readymade interfaces to popular data pools and for product data some kind of supplier portals. While the professional MDM vendor have viable methodologies for internal MDM processes there is an open door to the blue sky when it comes to external collaboration.
Data matching has increasingly become a component of Master Data Management (MDM) solutions. This has mostly been the case for MDM of customer data solutions, but it is also a component of MDM of product data solutions not at least when these solutions are emerging into the multi-domain MDM space.
While MDM solutions since then have been picking up on the share of the data matching being done around it is still a fairly small proportion of data matching that is performed within MDM solutions. Even if you have a MDM solution with data matching capabilities, you might still consider where data matching should be done. Some considerations I have come across are:
Acquisition and silo consolidation circumstances
A common use case for data matching is as part of an acquisition or internal consolidation of data silos where two or more populations of party master data, product master data and other important entities are to be merged into a single version of truth (or trust) in terms of uniqueness, consistency and other data quality dimensions.
While the MDM hub must be the end goal for storing that truth (or trust) there may be good reasons for doing the data matching before the actual on-boarding of the master data.
The actual matching effectiveness as explored in the post 3 out of 10
The point of entry
The MDM solution isn’t for many good reasons not always the system of entry. To do the data matching at the stage of data being put into the MDM hub may be too late. Expanding the data matching capabilities as Service Oriented Architecture component may be a better way as pondered in the post Service Oriented Data Quality.
When we talk about multi-domain Master Data Management (MDM) we often focus on the two dominant MDM domains being customer (or rather party) MDM and product (or maybe things) MDM.
The location domain is the third bigger domain within MDM. Location management can be more or less complex depending on the industry vertical we are looking at. In the utility and telco sectors location management is a big thing. Handling installations, assets and networks is typically supported by a Geographical Information System (GIS).
Master Data Management is much about supporting that different applications can have a unified view of the same core business entities. Therefore, in the utility and telco sectors a challenge is to bring the GIS application portfolio into the beat with other applications that also uses locations as explained in the post Sharing Big Location Reference Data.
The last couple of days I enjoyed taking part in the Nordic user conference for a leading GIS solution in the utility and telco sector. This solution is called Smallword.
It is good to see that at least one forward looking organization in the utility and telco sector is working with how location master data management can be shared between business functions and applications and aligned with party master data management and product master data management.
Location data are handled for different purposes using different kinds of systems. Customer data may be data quality checked by using address validation tools and services, which also serves as prerequisite for better utilization of these data in a Geographical Information System (GIS) and in using internal customer master data in marketing research for example by utilizing demographic classifications for current and prospective customers.
Often additional external location data are used for enrichment and for supplementing internal master data downstream in these specialized systems. It may very well be that the external location reference data used at different points does not agree in terms of precision, timeliness, conformity and other data quality dimensions.
A desired “to be” picture could be this:
In this set-up everything that can be shared across different purposes are kept as common (big) reference data and/or are accessible within a data-as-a-service environment maintained by third party data providers.