Which master data management software package should a business purchase? A recently released Gartner Magic Quadrant tries to answer this question.
As companies of all stripes move to adopt digital business strategies and derive greater value from their data, choosing the right MDM solution can play a pivotal role.
MDM provides a framework for business and IT managers working together to ensure uniformity, accuracy and accountability for their organization’s most important data assets, such as customer, sales and financial records. MDM software solutions bring together a range of technologies to create and maintain a single "golden record" of that data.
In its Magic Quadrant report, industry researcher Gartner evaluated MDM solutions from 11 leading vendors. Here we summarize the report’s assessment of the top five of those vendors by revenue, which accounted for over 80% of the MDM solution market in 2016.
SAP’s Master Data Governance v.9.0 entered general availability in September 2016, and SAP’s Hybris Product Content Management v.6.4 followed suit in May 2017. With an estimated 975 customers, SAP's total estimated MDM software revenue was $267.6 million in 2016.
--SAP has held the largest share of the MDM market for four years running now and posted year-over-year growth of 15 percent for 2016.
--The German software developer continues to demonstrate market leadership across a range of industries and is estimated to have the most customers managing multiple domains. SAP’s partners have developed MDG-based solutions for custom data domains, such as retail and oil and gas.
--SAP continues to invest in integration capabilities across its portfolio of offerings, and SAP MDG and SAP Hybris PCM can be deployed in Hana environments.
--End-user reference customer scores indicate that SAP's MDM execution lags behind the other leading vendors. Also, lack of penetration in the B2C customer data use case remains a challenge for the company.
--SAP uses a proprietary procedural programming language called Advanced Business Application Programming. Unless customers have already invested in other SAP products and have access to ABAP-literate resources, this represents a barrier to MDG adoption, but not to Hybris, which is built on a Java-based platform.
--SAP received average to below-average scores from reference customers across a variety of industries. Respondents noted specific weaknesses regarding TCO, solution pricing and information quality.
IBM’s InfoSphere Master Data Management version 220.127.116.11 entered general availability in May 2017. With an estimated 290 customers, IBM's total estimated MDM software revenue was $212.8 million in 2016.
--IBM provides an information integration and governance platform that can broadly support an organization's information management strategy. The vendor sells its MDM offerings both on a stand-alone basis and as bundles of workflow, stewardship and information governance capabilities and has an extensive network of implementation partners.
--Its solutions offer deep, discrete solution capabilities in support of the customer/citizen and product/thing master data domains, including workflow, data quality and data integration capabilities. IBM also has a best-in-class data-matching engine.
--The vendor offers monthly subscription pricing for its on-premises licenses, as well as a privately hosted cloud option with simplified tiered pricing.
--Gartner estimates that, following several years of double-digit revenue growth, IBM's 2016 MDM revenue grew just slightly above the market average, whereas smaller vendors regularly report double-digit growth.
--The proportion of Gartner's MDM client interactions that relate to IBM has declined over the past year in favor of smaller vendors.
--The company maintains a product roadmap for on-premises MDM, but intends to develop a "cloud-native" MDM capability with more SaaS-like characteristics, despite low demand for cloud deployment capabilities. Also, it still relies on a volume-based pricing model for on-premises MDM licensing, which is unpopular with customers.
Oracle has a large family of MDM-related products. These include: Oracle Product Hub, Oracle Supplier Hub, Oracle Customer Hub and Oracle Site Hub (E-Business Suite) v.R12.2.5, which all entered GA in September 2015; Oracle Product Hub Cloud Service and Oracle Customer Data Management Cloud Service v.R12, which entered GA in March 2017; Oracle Customer Hub (Siebel UCM) v.IP2017, which entered GA in June 2017, and Oracle Data Relationship Management (DRM) v.R18.104.22.168.340, which entered GA in April 2016. For 2016, the software giant’s total estimated MDM software revenue was $196.0 million.
--Oracle has deep solution expertise and capabilities in support of the major master data domains, which it developed for its E-Business Suite ERP application, Siebel CRM offering and, more recently, to support Oracle Cloud and its spectrum of MDM and application data management (ADM) suite and application offerings.
--Oracle has a wide range of solutions aimed at specific industries, such as communications, consumer goods, financial services, high tech, manufacturing, higher education, hospitality and utilities. These are both on-premise and cloud-based, and incorporate Oracle’s data management capabilities—including MDM.
--Oracle effectively positions its domain-specific MDM offerings as part of its larger business application ecosystem, particularly in the areas of customer experience (CX), supply chain management (SCM) and financial performance management (ERP). Coupled with its industry-oriented efforts, this positioning conveys a strong understanding of the business uses of MDM.
--Oracle’s current MDM strategy is tightly aligned with Oracle Cloud, and the company is shifting from an on-premise, perpetually licensed pricing model to cloud-based, subscription pricing. This resulted in a 17.9% drop in revenue in 2016—although it still commanded the third-largest market share among the top five MDM vendors.
--Oracle's cloud-based MDM offerings are integral to the Oracle Cloud Platform. Although they are licensed separately, they can be delivered on a stand-alone basis or as an embedded capability within various applications. But this amounts to an ADM approach to MDM, as the MDM functionality will likely be procured as an element of a suite or industry solution.
--Oracle’s reference customers' scores came predominantly from customers using its cloud-based MDM solutions and were average to below average. Its lowest scores clustered around product roadmap, end-user requests for new features, the sales process, as well as technical implementation and support.
Informatica’s MDM v.10.2, Product 360 v.8.0.6 and Supplier 360 v. 10.2 HF all entered general availability between October and December 2016. With an estimated 538 customers, Informatica's total estimated MDM software revenue was $158.1 million in 2016.
--Informatica was the most referenced vendor during the research for the MDM Magic Quadrant, with double the number mentions of the next most referenced vendor. Reference customers also indicated that Informatica was the vendor they included most frequently during competitive evaluations.
--Informatica is rationalizing its various MDM offerings, while integrating them with a new intelligent metadata discovery capability. It acquired Diaku and its Axon product to provide a robust data governance capability for both master and nonmaster data at the enterprise level.
--The company continues to invest substantially in its core multidomain MDM platform and industry solution accelerators. Informatica has also added "master-data-fueled applications"—Supplier 360, Procurement 360 and Relate 360—to Customer 360 and Product 360, enabling clients to govern master and non-master data across more domains and business contexts.
--Based on Informatica's messaging, many Gartner clients believe that the IDP is a physical product, when it is in fact a strategy involving multiple products. Informatica has attempted to mitigate this confusion, but it persists.
--Informatica's MDM-centric portfolio is expanding faster than its integration efforts. An enterprise-wide "solution" still requires more than one physical installation, and the company has yet to unify the existing stewardship and governance capabilities across its MDM portfolio.
--The software vendor’s estimated year-over-year revenue growth from MDM licenses decreased for the second consecutive year, from 5.3 percent in 2015 to 0.1 percent in 2016—underperforming the overall MDM market's growth. Although Informatica announced subscription pricing in May 2016, Gartner's contract reviews and interactions with reference customers suggest that this has yet to gain traction.
Stibo’s Enterprise Platform (STEP) Trailblazer v. 8.2 entered GA in August 2017. With an estimated 89 customers, the Danish developer’s total estimated MDM software revenue was $77.7 million in 2016.
--Stibo's STEP Trailblazer has proven itself a solid MDM platform, with in-memory capability, strong multichannel e-commerce features and improving multidomain functions. The software maker is also expanding its offerings with a stand-alone Salesforce-centric data quality product that runs on the Salesforce App Cloud.
--Stibo has invested in a "partner-led" sales and implementation strategy and the majority of its new implementations stem directly from its partners' efforts.
--In prior reference customer surveys, Stibo received some of the lowest scores for pricing transparency, but it has turned this around and this year it received some of the highest scores in this category.
--Stibo's revenue growth has declined significantly over the past three years, slowing to 2.1% in 2016, below the market average. Although still among the top five vendors for MDM revenue, the developer’s market share has been shrinking.
--Stibo scored the lowest of all vendors for product roadmap communication and visibility. This is likely to impede Stibo's strategy for expanding its product capabilities and migrating its customer base into multidomain MDM.
--Reference customer feedback has historically been strong for Stibo, but this year it only earned average overall satisfaction scores for both the company and its product.
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