Best Practices in MDM with Dan Power


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This presentation covers the definition of Master Data Management, outlines 5 essential elements of MDM, and describe 10 real-world best practices for MDM and data governance and 4 advanced topic areas, based on years of experience in the field.

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Best Practices in MDM with Dan Power

  1. 1. > Hub H b Solution Designs D i Best Practices in MDM and Data Governance May 21, 2010 Dan Power, Hub Solution Designs Inc Designs, Inc. Copyright © 2010 by Hub Solution Designs, Inc.
  2. 2. > MDM = Change (and Change is Difficult) Hub Solution Designs “Never d bt th t a small group “N doubt that ll of thoughtful, committed people can change th world. I d d h the ld Indeed, it is the only thing that ever has.” h ” Margaret Mead g But, as M. Scott Peck’s book “The Road Less T L Traveled” b i l d” begins, “Lif i diffi l ” “Life is difficult.” For many companies, it's not “if” they'll implement y p y p MDM, it's “when”. But how (and why) you do it is critical Page 2
  3. 3. > What Is Master Data Management? Hub Solution Designs My d fi iti M definition • MDM is a set of disciplines, processes and technologies • for ensuring the accuracy, completeness, completeness timeliness and consistency • of multiple domains of enterprise data - across applications, To succeed with systems and databases, and MDM, MDM start with • across multiple business processes, functional areas, data governance organizations, geographies and i ti hi d channels Page 3
  4. 4. > MDM 101 – Five Essential Elements Hub Solution Designs 1. The 1 Th MDM H b it lf Hub itself There are three major types: Registry Hub (stores only the identity information and foreign keys required for matching in the hub) Persistent or Transactional Hub (stores all of the critical data from each source system into the central hub) Coexistence or Hybrid Hub (uses a mix of both styles) Now it s common for vendors to have several different hubs it’s due to recent market consolidation (Oracle, IBM, Informatica) Page 4
  5. 5. > MDM 101 – Five Essential Elements Hub Solution Designs 2. Data integration or middleware 2 D t i t ti iddl Important to be able to synchronize data into and out of the hub Doesn’t have to be real-time but “near real-time” is becoming more common Whole point is to build a “Single Source of Truth” for a given domain Truth or domains Having out-of-date information in your hub – or not synchronizing data quality improvements back to your source systems – can defeat the whole purpose of your MDM program Page 5
  6. 6. > MDM 101 – Five Essential Elements Hub Solution Designs 3. Data Quality 3 D t Q lit Most companies quickly realize that they re they’re starting off with a much lower level of data quality than they expected So a robust data quality tool can be vital in standardizing and correcting data, data plus filling in some missing information A good data quality tool can make the difference between a dd t lit t l k th diff b t failed project and a successful project Profile your data early and profile often! Include regular profiling in your governance program … Page 6
  7. 7. > MDM 101 – Five Essential Elements Hub Solution Designs 4 E t lC t t 4. External Content Having worked for D&B, I constantly saw the value of providing information you don’t already have It could be something as straightforward as SIC codes, or as complex as corporate family trees and credit ratings When you “don’t know what you don t know”, working with don t don’t know an external content provider can be a big help Page 7
  8. 8. > MDM 101 – Five Essential Elements Hub Solution Designs 5. 5 Data Go ernance Governance This is actually the most important Without the people & p p p processes around your hub, the technology will (at best) be “a solution in search of a problem problem” The business won’t accept the solution unless they’re driving it, and resolving diffi lt questions of l i difficult ti f ownership is going to take some type of cross-functional group, with an executive sponsor, business data stewards, IT support, etc. Bringing together all of these elements is hard enough – don’t try to do it without a data governance organization Page 8
  9. 9. > So Why Are Companies Doing MDM? Hub Solution Designs • T solve specific b i To l ifi business problems • Compelling external events like Basel II or HIPAA • Overall competitive advantage p g globally • Three classic “drivers” – Increase revenues – Reduce costs – Improve compliance and decision making For a lot of companies, it’s not “if” they’ll do MDM and data governance, it’s “when” & “how” & “in what order” Page 9
  10. 10. > Some Best Practices Hub Solution Designs “90% of the game is half mental.” Yogi Berra So what works and what doesn’t work in the real world? Page 10
  11. 11. > MDM Best Practice #1 Hub Solution Designs • St t with th need, pain or Start ith the d i problem (not “the solution”) – The “build it and they will come” build come approach really doesn’t work for MDM – Make sure MDM solves some key business problems – How to get funding: find the pain points, and quantify the benefits (and cost) of fixing them In particular, look at the data-related components of other in-flight p , p g projects, then see how a centralized data hub can save money Page 11
  12. 12. > MDM Best Practice #2 Hub Solution Designs • A ti Active, i involved executive l d ti sponsorship – This is true for many projects, but projects especially so for MDM – To champion a change (towards managing master data as a true corporate asset) is going to mean significant cultural disruption – In most companies, that type of p , yp change is best driven “top down” Don t Don’t try to start until this is in place – when the rubber meets the road, you’ll need the “corner office” in your corner Page 12
  13. 13. > MDM Best Practice #3 Hub Solution Designs • E h i the organizational Emphasize th i ti l change management aspect – Critical to the success of large transformation projects like MDM – Outside perspective can be very helpful here – Your company’s culture is Courtesy: Michael Heiss probably not conducive to data quality or proactive master data management (or you wouldn’t need them) MDM projects can be very political, so figure out how to do organizational change management early, have a communications strategy and then communicate, communicate, communicate! Page 13
  14. 14. > MDM Best Practice #4 Hub Solution Designs • Th business h t own MDM The b i has to and data governance – As tempting as it is to start & finish s te pt g t s sta t s with the technology, it doesn’t work – When MDM is driven by IT, the business may not understand or buy in (or even realize it’s there) – It’s hard, but start by building interest and demand (recruiting) in the business – Otherwise, the business won’t be committed and getting f di will b itt d d tti funding ill be tough MDM’s nature (an ongoing program, not a “once & done” project) means that even if the initial project is funded, the business may not pick it up in Year 2 & beyond – unless the business owns it Page 14
  15. 15. > MDM Best Practice #5 Hub Solution Designs • P t your b t project manager(s) Put best j t ( ) and people on this – Make sure you can’t be derailed by can t opponents pointing to avoidable project management or organizational issues – Focus on controlling scope, getting the requirements right, managing risks, and communicating effectively & often – You cannot afford to have this type of project fail … Focus on delivering value, on time and on budget, and you ll you’ll silence the critics and deliver the expected ROI Page 15
  16. 16. > MDM Best Practice #6 Hub Solution Designs • U a h li ti approach – Use holistic h MDM Vision people, process, technology MDM Strategy and information MDM Metrics – This may be the most important best practice of all MDM MDM Governance Organization – Start with the people, politics & culture, then move on to the data MDM Processes governance and stewardship MDM T h l Technology Infrastructure I f t t processes, then the technology A Business-Driven, Holistic Approach to MDM Courtesy: Gartner 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 then communicate how the MDM processes, initiative helped the company achieve its strategic objectives Page 16
  17. 17. > MDM Best Practice #7 Hub Solution Designs • Thi k of MDM as a l Think f long term program, not a short term project p j – Define your “to be” state and break the project up into a se es o d sc ete, a ageab e series of discrete, manageable phases – An architectural assessment and a well defined strategy are good early deliverables – Spend some quality time planning the initiative – the time you invest will be repaid many times over! Plan for Pl f an MDM “ “way of lif ” not a project th t “goes live” f life”, t j t that “ li ” and then is over … Page 17
  18. 18. > MDM Best Practice #8 Hub Solution Designs • C Create a d t governance t data organization and processes – If there s no dedicated data there’s governance function, then no one lives & dies with the accuracy, completeness, accuracy completeness timeliness and consistency of the critical information the business uses b i – Before you start, convince management of the need for a g small data governance team There’s not much point in doing master data management if p g g you’re not going to govern the data … Page 18
  19. 19. > MDM Best Practice #9 Hub Solution Designs • R i t the urge to customize Resist th t t i – As the hubs mature, it's easier to resist the temptation to p customize – Sometimes pushing the vendor to improve future releases is a better strategy than customization – When you do customize, do it carefully; make sure your changes are “upgrade-friendly” upgrade friendly and documented Vendors are still revving their products once or twice a year, g p y so you don’t want to get “rev locked” on an older version Page 19
  20. 20. > MDM Best Practice #10 Hub Solution Designs • D ’t underestimate the complexity Don’t d ti t th l it – Einstein said “Everything should be made as simple as p p possible, but not simpler.” p – Not uncommon to have 20-30 source systems (or more) that have to be integrated with the hub – Tackling other things at the same time (like SOA or major upgrades) – MDM can help with those but it may increase degree of difficulty – If you underestimate, you’ll be under pressure to cut f functionality MDM and data governance can be disruptive to the business unless the business is driving the effort and it’s been well-planned Page 20
  21. 21. > Advanced Topic #1 Hub Solution Designs • Diff Differences b t between customer MDM t and product MDM – Product data is usually more complex, less structured and with more attributes – Product data quality more challenging (Oracle (O l acquired Silver C k S t i d Sil Creek Systems, a leading Product Data Quality solution) – Product data volumes tend to be higher,g , while initial data quality levels tend to be lower – Product data usually has more difficult categorization and hierarchy management It s It’s possible to make the leap from customer MDM to product MDM, but keep in mind the differences between the two Page 21
  22. 22. > Advanced Topic #2 Hub Solution Designs • Proacti e vs. reacti e data Proactive s reactive governance – Reactive uses CRM and ERP applications as “systems of entry” – Proactive uses the MDM hub itself as “system of entry”, then synchronizes new records or updates to CRM and ERP systems • Initial data quality levels much higher this way • More “real time” – eliminates time lags g • Reduces perception of “data governance as bureaucracy” It’s ti It’ 5 times cheaper to enter the data right in the first place than to h t t th d t i ht i th fi t l th t fix it later, and a good MDM hub can enforce data quality up front Page 22
  23. 23. > Advanced Topic #3 Hub Solution Designs • F t i b tt ! Faster is better! – Time to value, time to value, time to value; like the saying ‘location, ; y g , location, location’ in the real estate business – The cost savings in 6 12 months can 6-12 pay for a targeted project, vs. waiting 2 years or more to get value from the “ultimate” project “ ” – Can really hurt your ROI by increasing costs & postponing benefits Ask the business what it really wants – the elegant solution with the latest ‘whiz bang’ technology, or to get their master g gy, g data pain points resolved and to start getting value from MDM & data governance Page 23
  24. 24. > Advanced Topic #4 Hub Solution Designs • Don’t forget to do a b siness case! business – You’ll need a business case to understand the benefits, predict the direct and indirect costs and sell the program internally – Look for the big wins first; 80% of your benefits will probably come from 20% of your results – Don’t try to ‘tin cup’ your way into MDM – tackle the ‘800 pound g p gorillas’ in the room – Don’t file the business case away after ROI getting funding – use it as a tool to see how you re you’re doing relative to expectations, and to expectations manage throughout the life cycle – Use marketing & communications skill set Gartner research indicates that doing a business case for a project raises its odds for success to over 75% Page 24
  25. 25. > MDM is a Long Term Journey … Hub Solution Designs “Nothing in this “N thi i thi world can t k the ld take th 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 d t P i t d determination alone i ti l are omnipotent.” Calvin Coolidge 30th U S President Coolidge, U.S. If you’re persistent, you can help your company manage master data as an enterprise-wide asset – and transform itself enterprise wide in the process ... Page 25
  26. 26. > Hub Solution Designs Questions? Page 26
  27. 27. > Contact Info. Hub Solution Designs Hub Solution Designs Inc H b Sol tion Designs, Inc. 188 Whiting Street, Suite 3 Hingham, MA 02043-3844 office: (781) 749-8910 web: Dan Power,, _p Subscribe to our newsletter: g Today’s slides will be posted at: Page 27