Best Practices in MDM, OAUG COLLABORATE 09

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In this presentation, we'll help you better understand Master Data Management (MDM) and data governance, present some useful MDM and data governance best practices, talk about what works and what doesn’t, cover the importance of a holistic approach, and discuss how to get the political aspects right.

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  • What if we have E-Business Suite – can we take advantage of the MDM features in Oracle Customer Data Hub? In a word, yes!
  • What are the five essential elements of a successful MDM initiative?   (1) The MDM Hub itself . There are three major types. A Persistent Hub stores all of the critical data from each source system into the central hub. A Registry Hub stores only the identity information and foreign keys required for matching in the hub. A Hybrid Hub uses a mix of both styles, giving you the ability to fine-tune how much transactional data is synchronized into the hub, in order to optimize performance or reduce political issues around data ownership.
  • (2) Data integration or middleware . It’s important to be able to dynamically synchronize data into and out of the hub. The synchronization doesn’t have to be real-time, although a lot of organizations are heading that way (or at least to “near real-time”). Since the whole point of these projects is to build a “Single Source of Truth” for a particular domain like customers or products (or for multiple domains), having out-of-date information in the hub, or not synchronizing the data quality improvements you make back to the original source systems, can defeat the whole purpose of the project.
  • (3) Data Quality . Most companies quickly realize (through data profiling, which we strongly encourage, of course) or just through looking at their data manually, that their information almost always starts off with a much lower level of data quality than they expected. So a robust data quality tool can be very helpful in standardizing information (changing “Massachusetts” to “MA” where needed), correcting information (when someone types “Zerox” instead of “Xerox”), and filling in missing information (when someone doesn’t provide a value). A good data quality tool can make the difference between a failed project and a successful project.
  • (4) External Content (also known as enrichment) . Having formerly worked for D&B, one of the leading providers of information on businesses, I consistently saw the value to clients of providing information they didn’t already have. It could be something as straightforward as SIC codes, or as complex as corporate family trees and credit ratings. But when you “don’t know what you don’t know”, having an external content provider can be a big help.
  • (5) data governance . I listed this last, but it’s actually the most important. Without the people and processes that you’ll develop around your central hub, the technology is (at best) going to be “a solution in search of a problem”. The business won’t accept the solution unless they’re driving it, and resolving difficult questions of data ownership or quality is going to take some type of cross-functional group in the business, with an executive sponsor, business data stewards, IT support, etc.   Bringing together the various elements of an MDM initiative is hard enough - don’t try to do it without the support of a data governance council to own the solution and the data as it is developed and deployed.
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  • MDM Best Practices   Here are ten MDM best practices that I’ve picked up, based on years of being a management & technology consultant in this area, and on managing a strategic alliance between two of the largest players in the MDM marketplace.   1. Active, involved executive sponsorship: this is true for many types of enterprise technology projects, but even more so for MDM. Most organizations are quite comfortable with their “islands of data” and with technology implemented in silos. For someone to come along and suggest changing the status quo, that you need to start managing critical information centrally and treating it as a true corporate asset, is going to mean some significant cultural changes. In most enterprises, that type of change can only be driven "top down". This doesn’t mean your CEO has to personally be involved in every aspect of your MDM initiative. But when the rubber meets the road, you will need the “corner office” in your corner.
  • 2. The business should own the data governance process and the MDM project: As tempting as it can be to start and finish with the technology alone, that road doesn’t lead to success. We’ve seen a number of companies where the MDM initiative was driven by the IT organization, but where the business either didn’t understand or didn’t buy into the program. These projects ended up being perceived by the business as a “solution in search of a problem”. As hard as it is to do, you need to start building enthusiasm, interest and demand for new capabilities in managing and utilizing data within the business. Otherwise, business people won’t be committed to the project and funding will be hard to obtain. The nature of MDM (as ongoing programs rather than “once and done” projects) will mean that even if the initial project is approved, funded and completed, the business will not pick it up and run with it in Years 2, 3 and beyond.
  • 4. Use a holistic approach – people, process, technology and information: This may be the most important best practice of all. You’ve got to start with the people, the politics, the culture, and then make sure you spend at least as much time on the business processes involved in data governance and data stewardship, which really deserve a separate presentation. But you’ll succeed if you invest the time in creating a fairly small Data Stewardship Team (or whatever you call it); recruiting the right senior executive(s) to sponsor the initiative; creating or redesigning your processes for adding new master data records, modifying existing records, cleansing / standardizing / matching, resolving anomalies, reporting data quality metrics, reporting exactly where and how the MDM initiative has met helped the enterprise achieve its strategic objectives. The technology aspect is not a given, but you should start with “people” and “process” and let those guide your technology decisions.
  • Conclusion   Master Data Management, in all of its various forms, is an exciting area of technology and offers companies a real competitive advantage in terms of how they can use corporate information to make better decisions, increase revenue, avoid regulatory snafus, and provide better customer service.
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  • Best Practices in MDM, OAUG COLLABORATE 09

    1. 1. Best Practices in Master Data Management and Data Governance May 5, 2009 Dan Power, Hub Solution Designs, Inc. > Hub Solution Designs
    2. 2. MDM can be tough (especially in this economy) but … <ul><li>“ When the going gets tough, the tough get going.” </li></ul><ul><li>Joseph P. Kennedy </li></ul>MDM is definitely worth it – you can save your company a lot of money, make compliance easier, even increase revenue …
    3. 3. Executive Summary <ul><li>In today’s discussion, we will: </li></ul><ul><li>help you better understand Master Data Management (MDM) and data governance </li></ul><ul><li>present some useful MDM and data governance best practices </li></ul><ul><li>talk about what works and what doesn’t </li></ul><ul><li>cover the importance of a holistic approach </li></ul><ul><li>discuss how to get the political aspects right </li></ul>
    4. 4. Speaker’s Background <ul><li>Founder of Hub Solution Designs, a consulting firm that specializes in Master Data Management & data governance </li></ul><ul><li>Previously, was general manager for D&B’s strategic alliance with Oracle </li></ul><ul><li>Have worked with Oracle's enterprise applications since 1995 </li></ul><ul><li>Write a widely-read blog and newsletter, as well as a column for Information Management magazine </li></ul><ul><li>Regularly advise clients on developing & implementing high impact MDM and data governance strategies </li></ul>
    5. 5. So what is Master Data Management? <ul><li>My definition </li></ul><ul><ul><li>MDM is a set of disciplines, processes and technologies </li></ul></ul><ul><ul><li>for ensuring the accuracy, completeness, timeliness and consistency </li></ul></ul><ul><ul><li>of multiple domains of enterprise data - across applications, systems and databases , and </li></ul></ul><ul><ul><li>across multiple business processes, functional areas, organizations, geographies and channels </li></ul></ul>
    6. 6. What is MDM? (continued) <ul><li>Some definitions from Gartner </li></ul><ul><ul><li>Master Data: consistent, official set of identifiers, attributes and hierarchies for core entities </li></ul></ul><ul><ul><li>Master Data Management (MDM): a discipline used by business and IT to ensure uniformity, accuracy, stewardship and accountability of the organization's shared master data assets </li></ul></ul><ul><ul><li>Customer Data Integration (CDI): since 2003, the term has been used by software vendors. CDI = MDM for Customer Data. </li></ul></ul><ul><ul><li>Product Information Management (PIM): an accurate and single view of the product. PIM = MDM for Product Data. </li></ul></ul>
    7. 7. What is MDM? (continued) <ul><li>Definitions from The MDM Institute: </li></ul><ul><ul><li>Master Data Management: “The authoritative, reliable foundation for data used across many applications & constituencies with the goal to provide a single view of the truth no matter where it lies.” </li></ul></ul><ul><ul><li>Data Governance: “Formal orchestration of people, process, & technology to enable an organization to leverage data as an enterprise asset.” </li></ul></ul>
    8. 8. E-Business Suite vs. Customer Data Hub <ul><li>If you have E-Business Suite , you have the underlying foundation of Customer Data Hub (the Trading Community Architecture or TCA) and the Customers Online “front end” to the TCA Registry of parties and accounts </li></ul><ul><li>There are some differences in the “embedded Hub” vs. a separate Hub instance but a lot of the MDM best practices we’ll discuss today still apply </li></ul><ul><li>Ironically, lots of EBS sites use TCA & Customers Online very little or not at all </li></ul>
    9. 9. MDM 101 – Five essential elements <ul><li>The MDM Hub itself </li></ul><ul><li>There are three major types: </li></ul><ul><li>Registry Hub (stores only the identity information and foreign keys required for matching in the hub) </li></ul><ul><li>Persistent or Transactional Hub (stores all of the critical data from each source system into the central hub) </li></ul><ul><li>Coexistence or Hybrid Hub (uses a mix of both styles) </li></ul>
    10. 10. MDM 101 – Five essential elements <ul><li>Data integration or middleware </li></ul><ul><li>Important to be able to synchronize data into and out of the hub </li></ul><ul><li>Doesn’t have to be real-time </li></ul><ul><li>Whole point is to build a “Single Source of Truth” for a given domain </li></ul><ul><li>So having out-of-date information in your hub – or not synchronizing data quality improvements back to your source systems – can defeat the whole purpose of the program </li></ul>
    11. 11. MDM 101 – Five essential elements <ul><li>Data Quality </li></ul><ul><li>Most companies quickly realize that they’re starting off with a much lower level of data quality than they expected </li></ul><ul><li>So a robust data quality tool can be vital in standardizing and correcting data, plus supplying missing information </li></ul>A good data quality tool can make the difference between a failed project and a successful project Profile early and profile often!
    12. 12. MDM 101 – Five essential elements <ul><li>External Content (also known as enrichment) </li></ul><ul><li>Having worked for D&B, I constantly saw the value of providing information you don’t already have </li></ul><ul><li>It could be something as straightforward as SIC codes, or as complex as corporate family trees and credit ratings </li></ul>When you “don’t know what you don’t know”, working with an external content provider can be a big help
    13. 13. MDM 101 – Five essential elements <ul><li>Data Governance </li></ul><ul><li>This is actually the most important </li></ul><ul><li>Without the people & processes around your hub, the technology will (at best) be “a solution in search of a problem” </li></ul><ul><li>The business won’t accept the solution unless they’re driving it, and resolving difficult questions of ownership or quality is going to take some type of cross-functional group, with an executive sponsor, business data stewards, IT support, etc. </li></ul>Bringing together all of these elements is hard enough – don’t try to do it without a data governance organization Courtesy: Rhapsody Technologies, Inc.
    14. 14. Stages in Typical MDM Lifecycle <ul><li>Education, Strategy and Evaluation </li></ul><ul><ul><li>Education, Vision and Strategy </li></ul></ul><ul><ul><li>Business Case and ROI Analysis </li></ul></ul><ul><ul><li>Technology Evaluation </li></ul></ul><ul><li>Execution </li></ul><ul><ul><li>Definition / Planning </li></ul></ul><ul><ul><li>Design </li></ul></ul><ul><ul><li>Development </li></ul></ul><ul><ul><li>Deployment </li></ul></ul><ul><li>Ongoing Data Governance & Stewardship (in parallel with 1 & 2) </li></ul><ul><ul><li>Defining Metrics </li></ul></ul><ul><ul><li>Creating Organization </li></ul></ul><ul><ul><li>Developing Governance Processes </li></ul></ul>
    15. 15. Why Does All This Matter? <ul><li>So why are companies doing MDM initiatives? </li></ul><ul><ul><li>Most frequently, it’s to solve a specific business problem </li></ul></ul><ul><ul><li>Certain industries have had compelling external “compliance events” ( like Basel II or HIPAA) </li></ul></ul><ul><ul><li>But companies in every industry are looking to increase revenues , reduce costs , improve compliance & decision making , and get more ROI from their technology investments </li></ul></ul>
    16. 16. Some best practices we’ve observed <ul><li>“ 90% of the game is half mental.” </li></ul><ul><li>Yogi Berra </li></ul>So what works and what doesn’t work?
    17. 17. MDM Best Practice #1 <ul><li>Start with the need, pain or problem (not “the solution”) </li></ul><ul><ul><li>The “build it and they will come” approach really doesn’t work for MDM </li></ul></ul><ul><ul><li>Make sure MDM solves some key business problems </li></ul></ul><ul><ul><li>How to get funding: find the pain points, and quantify the benefits (and cost) of fixing them </li></ul></ul>In particular, look at the data-related components of other in-flight projects, then see how a centralized data hub can save money Courtesy: sel
    18. 18. MDM Best Practice #2 <ul><li>Active, involved executive sponsorship </li></ul><ul><ul><li>This is true for many projects, but especially so for MDM </li></ul></ul><ul><ul><li>To champion a change, towards managing master data as a true corporate asset, is going to mean significant cultural disruption </li></ul></ul><ul><ul><li>In most companies, that type of change is best driven “top down” </li></ul></ul>Your executive sponsor doesn’t have to be involved in everything, but when the rubber meets the road, you need the “corner office” in your corner
    19. 19. MDM Best Practice #3 <ul><li>Emphasize the organizational change management aspect </li></ul><ul><ul><li>Critical to the success of large transformation projects like MDM </li></ul></ul><ul><ul><li>Outside perspective can be very helpful here </li></ul></ul><ul><ul><li>Your company’s culture is probably not conducive to data quality or proactive master data management (or you wouldn’t need MDM) </li></ul></ul>MDM projects can be very political, so figure out how to do organizational change management early on and communicate, communicate, communicate! Courtesy: Michael Heiss
    20. 20. MDM Best Practice #4 <ul><li>The business should own MDM and data governance </li></ul><ul><ul><li>As tempting as it is to start & finish with the technology, it doesn’t work </li></ul></ul><ul><ul><li>When MDM is driven by IT, the business may not understand or buy in </li></ul></ul><ul><ul><li>It’s hard, but start by building interest and demand (recruiting) in the business </li></ul></ul><ul><ul><li>Otherwise, the business won’t be committed and getting funding will be tough </li></ul></ul>MDM’s nature (an ongoing program, rather than a “once & done” project) means that even if the initial project is funded, the business may not pick it up in Year 2 & beyond
    21. 21. MDM Best Practice #5 <ul><li>Put your best project manager(s) and people on this </li></ul><ul><ul><li>Make sure you can’t be derailed by opponents pointing to avoidable project management or organizational issues </li></ul></ul><ul><ul><li>Focus on controlling scope, getting the requirements right, managing risks, and communicating effectively & often </li></ul></ul><ul><ul><li>You cannot afford to have this type of project fail … </li></ul></ul>Focus on delivering value, on time and on budget, and you’ll achieve the expected ROI
    22. 22. MDM Best Practice #6 <ul><li>Use a holistic approach – people, process, technology and information </li></ul><ul><ul><li>This may be the most important best practice of all </li></ul></ul><ul><ul><li>Start with the people, politics & culture, then move on to the data governance and stewardship processes, then the technology </li></ul></ul>You’ll succeed if you recruit the right executives as sponsors; invest the time to create a data governance team; design your governance processes, and communicate how the MDM initiative helped the company achieve its strategic objectives Courtesy: Gartner
    23. 23. MDM Best Practice #7 <ul><li>Think of MDM as a long term program, not a short term project </li></ul><ul><ul><li>Define your “to be” state and break the project up into a series of discrete, manageable phases </li></ul></ul><ul><ul><li>An architectural assessment and a well defined strategy are good early deliverables </li></ul></ul><ul><ul><li>Spend some quality time planning the initiative – the time you invest will be repaid many times over! </li></ul></ul>Plan for a “MDM way of life”, not a project that “goes live” and then is over … Courtesy: basi_16816
    24. 24. MDM Best Practice #8 <ul><li>Create a data governance organization and processes </li></ul><ul><ul><li>If there’s no dedicated data governance function, then no one lives & dies with the accuracy, completeness, timeliness and consistency of the critical information the business uses </li></ul></ul><ul><ul><li>Before you start, convince management of the need for a small data governance team </li></ul></ul>There’s no point in doing master data management if you’re not going to govern the data …
    25. 25. MDM Best Practice #9 <ul><li>Resist the urge to customize </li></ul><ul><ul><li>As the hubs mature, it's easier to resist the temptation to customize </li></ul></ul><ul><ul><li>Sometimes pushing the vendor to improve future releases is a better strategy than customization </li></ul></ul><ul><ul><li>When you do customize, do it carefully; make sure your changes are “upgrade-friendly” and documented </li></ul></ul>Most vendors are still revving their products once or twice a year, so you don’t want to get “rev locked” on an older version
    26. 26. MDM Best Practice #10 <ul><li>Don’t underestimate the complexity </li></ul><ul><ul><li>Not uncommon for companies to have 20-30 source systems that have to be integrated with the hub </li></ul></ul><ul><ul><li>Tackling other things at the same time (like service-oriented architecture or major upgrades) – MDM can help with those but it does increase degree of difficulty </li></ul></ul><ul><ul><li>If you underestimate, you’ll be under pressure to cut functionality </li></ul></ul>MDM and data governance can be disruptive to the business unless the business is driving the effort and it’s been well-planned
    27. 27. MDM Best Practice #11 <ul><li>Test, test, test and then test again </li></ul><ul><ul><li>Your MDM hub is going to be different from every other hub in the world </li></ul></ul><ul><ul><li>You’ve got a unique variety of source systems - and some of those may be custom and won’t exist anywhere else </li></ul></ul><ul><ul><li>Most vendors are doing much better at testing and QA, but the burden of testing remains squarely on the implementing company and the project team </li></ul></ul>Don’t assume that just because something’s in general release, that it will work perfectly at your site
    28. 28. MDM is a journey, not a sprint <ul><li>“ Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful people with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent.” </li></ul><ul><li>Calvin Coolidge, 30 th U.S. President </li></ul>
    29. 29. <ul><li>Questions? </li></ul>
    30. 30. Contact Info. <ul><li>Dan Power [email_address] Hub Solution Designs, Inc. www.hubdesigns.com (781) 749-8910 office blog.hubdesigns.com (781) 735-0318 fax twitter.com/dan_power </li></ul><ul><li>Download this presentation: </li></ul><ul><li>www.hubdesigns.com/ conferences.html </li></ul><ul><li>Subscribe to our newsletter: </li></ul><ul><li>www.hubdesigns.com/ newsletter .html </li></ul><ul><li>Join the MDM Community: </li></ul><ul><li>http://mdmcommunity.ning.com </li></ul>

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