Master data can be defined as data that will be used across several business units in an enterprise and needs consistent definition such as customer and product data. MDM is the process of identifying, acquiring, integrating, and utilizing master data. MDM is often implemented through programs such as Customer data integration (CDI) or product information management (PIM). It relies heavily on ability to address data quality and matching, which technology tools can help automate and on active data stewardship and governance. The two most common drivers for MDM are:
• Reducing cost of business by improving the quality of the data used by the various business units and their systems. For example a telecom company may provide its customer several services such as cable, internet, and phone. If the customer information is synchronized across all business units using MDM the company can reduce costs by sending the customer one bill instead of one for each service. In addition since all customer records are centralized it is easier to address any quality issues and thus reducing the cost.
• Aiding sales and marketing by providing a single, full spectrum view of important business entities such as customer and products. Full spectrum of 360 degree view of an entity means that all details about the entity gathered and used across the various business units in the enterprise are centralized, standardized, cleansed, and made available to all business units. For example it is extremely useful for marketing campaigns to know which customer has which products and based on customer characteristics identify cross-sell and up-sell opportunities.
MDM is typically implemented as a data hub which is maintained real-time or near real-time. All applications in the enterprise interact with the MDM hub to feed and utilize master data. The success of an MDM program requires not just technology but also a strong, robust, and mature data governance process and commitment from the business and IT leadership