Managing product information across a large organization consists of much more than making sure prices and descriptions are accurate and consistent. Large manufacturers and retailers employ teams of people tasked with the job of cross checking product data. While the deployment of these teams is a good idea in theory, the process is loaded with inefficiency and errors are all but guaranteed.
Collating massive amounts of product information is undoubtedly a daunting task – multiple departments are involved and manually managing the process is an administrative nightmare. Yet the consequences of flimsy data management are too large to ignore. The lack of a single, unified view of product data leads to unreliable, inefficient and time-consuming processes at best. At worst, it puts the company at risk to lose customers, increases more customer inquiries and product returns and leaves companies open to regulatory fines and lost revenues. When organizations fail to incorporate a cohesive data management strategy, inefficiency becomes the standard. Organizations – especially manufacturers and retailers – need to re-evaluate their product data management practices and incorporate master data management into their long-term IT and business strategy.
For example, manual data management processes can hamper an organization’s growth and seriously affect potential revenue. For large companies, manually cross-referencing data wastes valuable time and resources. Failure to ensure consistency among product information can force companies to sell their products at much lower prices, affect a company’s ability to accurately track inventory or even result in the delivery of incorrect products. This kind of error results in costly product returns and leaves the company with inventory that cannot be resold along with a significant dent in the revenue – not to mention the impact on customer satisfaction.
Customer expectations are high in retail – customers demand accuracy and speed. A flawed or incorrect product will immediately tarnish the brand in the eyes of a customer. Organizations should not accept partial accuracy as a standard and remain vulnerable to errors that waste time and resources while damaging the bottom line and a company’s reputation.
Money is not the only resource wasted because of a poor data management strategy. Manually collecting and maintaining accurate information across multiple product lines requires a significant amount of time. Let’s consider a major retailer planning to roll out a new product line. If the retailer manages its data manually, it must hire a team of people to cross-check data. In the time the team spends ensuring data accuracy, the retailer’s competitors can beat the company to market by announcing a similar product. Inconsistencies are not an option because a retailer’s success depends on the ability to constantly innovate and introduce new products in a quick and timely manner. Implementing an automated data management system ensures valuable time is not wasted and organizations can maintain their competitive edge.
Apart from saving resources, MDM enables accurate information to be centralized and shared among multiple systems and applications. In most organizations, master data is duplicated and evolves independently – resulting in faulty information and potentially leading to costly inefficiencies. Rather than keep critical information siloed across the enterprise, organizations stand to gain in efficiency when they centralize all master data. Streamlined data governance and controls lead to increased data availability, integrity and security as well as improved regulatory compliance. With a single view of all product, supplier, location and other types of master data, organizations can see how sets of information impact each other and can make better-informed decisions. In a turbulent economic environment, simplification and quick capitalization of opportunities are crucial. MDM empowers organizations to use their existing data as an asset rather than risking loss of valuable opportunities by mismanaging information.
Ultimately, MDM allows organizations to gain a global and comprehensive view of their customers. Regardless of how a company defines its customers, it is imperative to centrally manage customer data and distribute that information to the systems that need it. For instance, organizations inevitably accumulate enormous amounts of information that need to be used for CRM purposes. Customer relationship management is the system at the front of an organization’s master data and requires accurate information to reach its potential. Although data is housed within the CRM system, many changes may not be communicated to other systems. MDM serves as a critical element of success for any CRM system. In order for customer data to be efficiently maintained and integrated, companies need a singular system to focus on managing the master data.
Reaching the customer base through multiple channels is expected of large businesses. Ensuring data accuracy across one region is a challenge in itself. Managing customer data across the globe can easily become a nightmare without the information centralized in one system. For retailers, if product information remains in separate silos across the enterprise, there will be extra work and duplication, not only wasting millions of dollars, but also preventing efficient marketing. Centralizing and consolidating data will help organizations tailor marketing campaigns and special offers quickly and efficiently across global markets and throughout every channel.
Customers have extremely high expectations, and a minor data error in one channel has the potential to be magnified and scrutinized, affecting the company’s credibility. For an example of this, look no further than Best Buy, which took a significant public relations hit when it was unable to honor a low price for flatscreen TVs that appeared on its Web site due to a data error. Risking customer dissatisfaction should never be an option. Successful multichannel integration wholly depends on a single repository of data.
The value and efficiency provided by a centralized system are too great to ignore. As businesses continue to look for ways to better target their customers and increase revenue, MDM must be kept top of mind. Organizations can no longer view MDM as a luxury but must see it as a necessary system to streamline existing data, optimize valuable IT assets and improve operational agility. Manually devoting personnel and resources to manage data and identify valuable relationships has proven to be tremendously wasteful, inefficient and inaccurate. In an unstable economic environment, businesses cannot ignore the risk and costs associated with data mismanagement. Companies must realize their innovation and competitive advantage relies on accurate, consistent data. Accepting inefficiency can no longer be an option.
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