Master data management and data governance are among the most widely adopted IT strategies in recent years. This is due to the fact that both are critical for vital business outcomes such as 360-degree views of customers/products/suppliers, regulatory reporting and compliance, and in general treating data as an enterprise asset.
MDM is no longer a "fast follower" technology. It is now a mature solution providing tangible benefits for private and public sector organizations. The desired economic outcomes include new ways to drive down costs, enable better regulatory compliance, provide higher levels of customer satisfaction and to provide increased agility -- whether to add new channels or products or to prepare for and execute on mergers and acquisitions. Data governance is critical to achieving sustainable and effective MDM. Failure to execute data governance concurrently with an MDM program greatly decreases the probability of success and economic sustainability of MDM programs.
Why is 2012 a Pivotal Year for Your Career?
Now is the time that "type A" IT professionals are plotting out their next career moves. MDM and data governance remain hot career areas during 2012, but what about the next 12 to 18 months? Many IT pros have been trained in the major MDM solutions, and some already have a year or more project experience. If you stake your two-to-three-year career plan to a specific MDM platform you should do fine. However, if you spice your resume up via reference data management, cloud-enablement and integration, and big data analytics (particularly for social CRM/MDM data), you may have enhanced your compensation potential by 30 percent or more. However, you will also be a "data integration pioneer," and we all know that pioneers are risk-takers and often suffer. But you can still be a "fast follower" IT pro by monitoring such MDM-related areas and adding them to your skills portfolio – rather than risking your near term sanity and job prospects exclusively in such new areas!
MDM is both pervasive and pandemic. Over the past seven years as conference chairman for the global event series MDM & Data Governance Summit, I have observed hundreds of MDM implementations in almost every industry around the world ranging from very large, highly heterogeneous distributed enterprises to midsize, mostly homogeneous centralized/local enterprises. In this same time frame, more than 6,000 IT professionals have attended our workshops and tutorials in London, Frankfurt, Madrid, Moscow, New York, San Francisco, Singapore, Sydney, Tokyo and Toronto.
During the first quarter of 2012, analysts at the MDM Institute reviewed more than 750 MDM and data governance case studies as part of the process to arrive at 10 strategic planning assumptions. This 2012-13 “MDM & Data Governance Roadmap” should serve as a guide to help focus efforts for MDM programs.
The bottom line is that MDM is quickly broadening its attractiveness both as a key enabler of strategic business initiatives as well as tactical P&L initiatives. More so than service-oriented architecture or business process management experience, a very large number of IT pros are riding the cresting wave of MDM and data governance. Just check your job sources for these keywords and browse the number of people (and positions offered) for these two key areas in LinkedIn groups and you will have confirmation. As of 2012, MDM is no longer fast-follower technology strategy but is clearly a business strategy for the masses.
What do you think are the most important aspects of a career in master data management? Vote and join the discussion here in our LinkedIn discussion group.
The following summary trends should you give you some insights into how MDM and data governance overlay other trending IT areas such as big data, reference data, social CRM/MDM, etc.
1. Pervasive MDM (MDM as a Service)
During 2012, the vast majority of application providers will deploy en masse their next generation of MDM-innate (as opposed to MDM-aware) applications as SAP delivers SAP Master Data Governance for ECC/BBD, Oracle delivers Fusion applications with Fusion MDM, and Teradata ships Aprimo database marketing apps with their embedded MDM. Concurrently, SaaS vendors such Salesforce will struggle to provide integrated/native MDM capabilities to repatriate cloud-based data and services. Also, a good deal of departments in large firms and frugal IT organizations (government sector) will pick up Microsoft Master Data Services, open source (from vendors such as Talend) and even hosted MDM capability (such as Orchestra Networks) to take a lower-cost entry point into MDM and data governance. By 2014, the market for MDM-enabled applications (such as Oracle, SAP) will exceed that for discrete MDM software. However, MDM-innate apps will overwhelm MDM-enabled apps as the vendors successfully roll out this current generation.
2. Business Process Hubs
As market observers, it is clear that the "20 years war" between business process management and master data management has kept its ideological fires brightly burning by these two diverse camps of competing vendor technologies. Both camps admit that "process needs data" and "data needs process." (How hard was that for their marketing execs to figure out?) During 2012, MDM solution providers and BPM solution providers will increasingly collide in the market as the former acquire or build out BPM-centric MDM. Yet both camps will be challenged to unify these domains, because different business processes for CDI and PIM exist.
Through 2012-13, however, BPM-centric MDM will suffer from BPM’s traditional focus on modeling and not executing MDM rules. By 2014-15, all mega MDM and BPM vendors will have overcome this dogmatic bias as enterprise BPM needs to execute within governance and vice versa be able to execute MDM workflows within BPM. From the enterprise perspective, a complete MDM solution requires both rules and reference data to be applied across domains. In short, MDM hubs have become "business process hubs." SAP Master Data Governance and IBM Master Data Policy Hub are leading market examples.
3. Big Data
Operational MDM systems are not designed to store "all" transactional data, let alone "big data." But there a large number of use cases that require MDM to integrate with big data technologies. In many cases, an MDM system must identify social CRM individuals (or groups of influencers) and relate them to customers or products in the MDM world. By mining and managing such info, an MDM system is enabled to feed big data analytical apps with relevant master data and links back to the big data. Just as vital is MDM's capability to store (share/publish) the key analytical findings from big data such as likelihood to attrite/recommend/defraud, next best offer, intent to purchase, etc.
Through 2012-13, big data will repatriate itself into the MDM fabric via registry overlays as yet another source. Mining of big data to populate social MDM and to perform entity matching on big data stores will help provision a 360-degree view of entity from public, subscription and enterprise data. Through 2012, registry-style MDM solutions will find favor in industries where data is legally or physically too difficult to consolidate into a physical hub, especially government and U.S. health care. During 2012-13, mega MDM vendors will apply the powerful hierarchy management capabilities of native registry solutions to integrate legacy MDM hubs, enterprise content management and big data.
4. Social MDM (Cloud-Enablement, Architecture and Integration)
During 2012, cloud-enabled MDM will attract small- and mid-sized businesses as a means to engage in MDM without committing to long-term project and major expense while offering an enticing entry point for large enterprises (particularly for opex versus capex, geographically distributed organizations, POCs). Through 2013-14, cloud-integrated and MDM-enabled apps will arrive via Salesforce, SAP BBD, and others; however, enterprises will wrestle with data integration issues between on-premise and cloud with majority of organizations unwilling to house master data about customers, products and suppliers in public cloud.
By 2014-15, very large enterprises (e.g., financial services, large government agencies) will look to real-time MDM flows and scaling of MDM solutions via elasticity of cloud-based solutions, in-memory databases and next-generation ETL/MDM, while acknowledging that big data innately requires both MDM and data governance to be effective and sustainable. By 2014-15, cloud-innate services for data quality and data governance will be more prevalent than full social MDM. However, enterprise MDM will remain “on premise” with increasing integration to public cloud applications. Concurrently, MDM-enabled applications will migrate to public cloud, especially for decentralized/geographically distributed organizations. Mega vendors will adapt matching algorithms of registry MDM hubs to bolster the performance and accuracy of their operational/transactional hubs matching throughput. As an example, look to SAP's recent announcement of HANA-enabled SAP Master Data Services to provide its "real-time customer data integration" capability. This will be critical to the success of social MDM.
5. Reference Data Management
Reference data management, or RDM, is often rightfully characterized as a subset of MDM -- albeit with other requirements and workflows layered on. Such non-volatile lookup tables (such as metrics and measurements, ISO country tables, asset locations, etc.) can be implemented by leveraging the flexible models found in the current crop of MDM platforms or via specialized variants of the major/mega vendor MDM systems. In any case, through 2012-13, reference data will emerge as a key entry point for enterprises and in turn unduly influence their choice of MDM for Customer, Product and other domains.
Concurrently, MDM vendors will rush to market RDM solutions to apply an MDM approach for centralized governance, stewardship and control. By 2014-15, pervasive, low-cost RDM will be commoditized via the efforts of Microsoft and others. Managing “simple” reference data will prove to be a key sales entry point for MDM vendors, and each vendor must provide such packaged offerings to effectively compete at this level.
Bottom Line Redux
MDM and data governance are codependent/interdependent. Savvy organizations must invest upfront in data governance for MDM sustainability and ROI. Savvy individuals will look to leverage the related trends of big data, social CRM/MDM and reference data management.
“Go early, go governance” clearly provides the best possible resume for an IT professional when combining both MDM and data governance program experience to the top of your resume credits, but you should also spike your resume this year with training and experience in big data, social CRM/MDM, and reference data management.
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