What is Master Data Management?

• Master Data is consolidated data about customers, partners, suppliers, products, locations, and other business-critical entities referenced by multiple IT systems

• Master Data Management (MDM) is a set of processes and technologies aimed at creating, maintaining and continuously updating a reliable and governed “single version of truth” for these business-critical entities

• Customer Master Data Management models and governs data through the entire customer lifecycle, including data about leads, prospects, current and past customers, and accounts. It is applicable and useful in both B2B and B2C contexts, and is typically the first type of MDM that an Enterprise pursues to better understand and interact with its customers.

MDM - Business Value Map

The business value map (BVM) shows how each of the capabilities that is part of a typical customer master data management project aligns to business value, including revenue growth (improved go-to-market) and cost reduction (operational efficiency).

Typical Challenges of not having a Customer MDM

Nearly every business process is improved by customer MDM and the resulting reductions in accurate and outdated data

Below are some challenges that enterprises encounter in the absence of customer MDM:

• Inaccurate and incomplete account assignments to sales teams. Account duplication, territory assignment re-work and other inefficiencies.
• Incorrect ead assignments and follow-up. In correct territory/location information, poor address quality, incorrect association between accounts and contacts.
• Lack of accurate and complete account segmentation, hierarchy, and industry Classification Issues. Results in inappropriate sales and marketing treatments and campaign targeting.
• Ineffective marketing campaigns with reduced effectiveness and unwanted “whitespace” (non-contacted customers) Incorrect or out-of-date email and other contact info.
• Manual, error-prone processes for critical activities. Inability to generate reliable unique customer counts for external (“Wall Street”) reporting, insufficient ability to audit critical data driving financial reporting. Slow process to generate and update accurate marketing campaign lists.
• Data Integration Challenges (inaccurate and slow)
  • # Of Customers not in synch across critical transactional systems (ERP, CRM, Customer-support …)
  • Segmentation/classification mismatch between various systems
  • Different Customer Names across systems
  • Inaccurate parent-child relationships across systems

Key Capabilities of a Customer Master initiative

Enterprise Definition of a Customer (Accuracy and Uniqueness):

A consistent and accurate definition of a customer, and associated attributes and activities, drives effective and efficient customer interaction, sales, marketing, operations and financial activities vis-à-vis these customers. The MDM “golden record” is where this consistent definition of customers and associated attributes and activities resides, available to IT systems across all of these business functions.

Customer Hierarchies & Relationships

In a B2B customer context, it is important to not just have accurate data about a given customer, but also how this customer relates to other customers – e.g. subsidiary to parent company relationships. Different hierarchies are important to different business functions – e.g. the sales team needs to have accurate and up-todate data about the organizations they are interacting with in a pre-sales and post-sales context, the marketing teams needs to understand which people are appropriate to communicate with within an organization, and the finance team needs accurate “bill-to” information. Hierarchies can be defined internally and/or via external data (e.g. Dunn and Bradstreet data re: global organizations) and need to be kept refreshed in the face of mergers and acquisition activity as well as divestitures.

Customer data completeness & enrichment

A well-governed customer master and associated orchestration activities facilitates the availability of enriched data. Attributes formerly only available to one business function now become available to all business functions. External data acquisition (e.g. D&B, Acxiom) becomes more efficient and cost-effective because it only needs to be done once for the organization, rather than by multiple teams and IT Systems. A unified, common format reduces error and misinterpretation of the data.

Security, compliance & financial reporting

By organizing your data in a professional, centralized and consistent way it is easier to keep a catalogue of all the information you have and ensure appropriate data audits. This facilitates security, compliance and enterprise reporting.

Benefits of having MDM

Lower Total Cost of Ownership (TCO) and Faster time-to-market:

With a Customer Master in place, adoption and implementation, along with existing maintenance and management costs, come down significantly. MDM’s ability to centralize, standardize, enrich, validate, and link master data records, along with automated workflows to deliver data consistently and quickly across any downstream applications and business use cases, reduces IT costs and accelerates revenue-driving business activities (GTM).

Improve Enterprise-wide Efficiency and Higher ROI

MDM helps enterprises to function with amplified acceleration and agility. It boosts the association between applications, systems, and people by integrating disconnected processes to drive performance, manage workflows better, promote collaboration, and reduce risks. It converts duplicate, inconsistent, contradictory data into a single, authoritative form of truth—a golden repository of data. Efficient master data management has a direct bearing on a company’s ROI, as all the data-oriented activities depend on the quality of your data and strong collaboration. Organizations can support customers and employees with streamlined processes, saving time and resources; marketing and sales teams can target and serve customers in the best possible way, maximizing ROI.

Enhance Decision-making and Great Customer Experience (CX)

MDM enables improved reporting, compliance, and monitoring to drive optimal assessment of risk and opportunities. With a 360-degree view of the customer across all interactions with the enterprise, decision-makers and process owners can swiftly detect and remedy glitches in processes thereby optimizing productivity, market performance, and customer service. MDM helps an enterprise offer a personalized, connected, consistent, and optimized customer experience and engagement. Enhanced visibility into customer preferences through profiling, behavioral data analysis and Predictive analytics drive customer retention, growth and loyalty.