Today’s business world craves information. Data has become the lifeblood of most organizations. With the right information at the fingertips of the right people, more informed business decisions are made and competitive advantages increase. However, as information sources and technology continue to advance at a rapid pace, the amount of data organizations require also continues to grow. For many companies, the mounds of data have become unmanageable, creating operational, data quality and regulatory compliance challenges.


With disparate silos of operational and analytical systems across their organizations, most companies are presented with numerous data management challenges. Redundant and inconsistent data, lack of data integrity and reporting discrepancies are a few examples of these challenges that can cause significant inefficiencies within an organization.


How do the life science, financial and health care companies, especially larger ones that are inundated with data, overcome this immense challenge? The answer is master data management (MDM). The basic premise behind MDM is that it provides one, trusted and unique “version” of important enterprise data (i.e., customer, product, employee, asset, material, location) and eliminates the confusion imposed by multiple, inconsistent versions of data being used across the organization.


The MDM solution can serve as a hub of critical enterprise information with a well-established set of governance policies and procedures to assist in quality and control of information. It also serves as the home of the cross-reference information that enables application-to-application integration and real-time Web services without the need to pull out all the wiring in the walls of your legacy applications.


MDM solutions by themselves provide little value, and a fully implemented solution can be quite costly in terms of implementation, organizational change and ongoing support and governance. However, by using the MDM framework as the foundation of the information used within functional business processes (sales, marketing, finance, distribution, support, etc.), direct benefits to employees, customers, partners or other relevant stakeholders within an organization can be realized. Because of these benefits, MDM is being put on the short list of initiatives for companies attempting to effectively and efficiently manage data across their organizations.


Buy-In Challenges

From IT’s point of view, MDM simplifies information management and relieves many associated headaches. On the business side, managers often fear anything that will change the way they operate on a daily basis. Over the years, MDM projects have gained the reputation of being long, drawn out and unsuccessful. Two major reasons for this reputation are that organizations have bitten off more than they can chew and have not aligned their project with their organization’s key business objectives. Hence, there has been apprehension among management teams when MDM is discussed, and it has made getting management buy-in the first major hurdle of MDM projects.


MDM projects may seem overwhelming and expensive, but if a strategic plan for a project is developed that addresses specific business objectives of the organization, getting management buy-in becomes a much easier task.

Successful implementations have been a result of a well-defined long-term strategy coupled with tactical short-term deliverables, integrating MDM solutions with other key four-to-six month initiatives.


For example, if an MDM solution is designed specifically for medical affairs, it can provide accurate notification of product updates, improve clinical trial and recruitment communication and drive thought-leadership communication and solicitation. Management would find significant value in having this ability. Also, if an MDM solution is implemented for contract/rebate management, the organization can reduce rebate payments and improve compliance to contracts and rebates, while more efficiently managing contracting relationships. Again, managers identify with these benefits.


Similar ROI can be realized for regulatory compliance. An MDM solution can help a pharmaceutical company, for example, track and adhere to state and federal regulations, minimize compliance costs, reduce regulatory exposure and avoid penalties. Also, for sales and marketing operations, an MDM solution can be developed to improve territory alignment and compensation management, guide new market penetration and proper customer segmentation as well as increase marketing campaign ROI. Additionally, MDM solutions can help companies with product categorization by accurately correlating products to price, contract and customer as well as helping understand product distribution relationships and designing better pricing models and procurement efforts.


Best Practices


Successful MDM strategies start with addressing business problems and engaging a business sponsor as a champion for the effort upfront. Whether the goal is to enable more accurate customer targeting and campaigns, improve product portfolio performance or reduce data management costs, winning strategies align business processes, governance and technology aspects with these goals.


Successfully executing these initiatives results in consistent, reliable integration, distribution and maintenance of master data entities (such as customers, products, pricing, employees and locations), allowing master data to be utilized within the context of business processes and applications.


Rather than falling victim to mega-project promises, companies are now opting for a more prudent, phased approach that focuses on a specific initiative, such as a regulatory or customer segment-based need, while building the foundation for an enterprise-wide MDM platform. This enables quicker ROI to be realized in as little as three months.



The following are six best practices companies have used to ensure the success of their MDM initiatives.

  1. Establish awareness. The first step in any major corporate initiative is establishing awareness among all parties that will be affected in one way or another. Holding management workshops to outline the roles of each individual or department and their responsibilities during the project is an excellent place to begin. It will get everyone up to speed and working from the same starting point. In these workshops, it is important to begin by discussing the values that the MDM project will offer to stakeholders and to the company as a whole. Emphasizing the expected ROI will garner support for the project and motivate stakeholders as the project moves forward.
  2. Be Strategic. As organizations investigate opportunities to improve overall information management, the key issue becomes how to prioritize initiatives to build the necessary foundation and determine the next steps in delivering the best value-add and advantages. First, look at the big picture, conceptualize your success and define your MDM vision. The foundation for your organization’s data management structure, will need a well-thought-out strategic plan for implementation and management of the solution and the involved processes. Begin by developing an MDM solution that answers one specific business need, and bring in a business “sponsor” to support the project. From there, build onto that solution, adding other business areas and constantly communicate both successes and opportunities.
  3. Develop a Roadmap. Once you have your MDM strategy defined, the next step is to develop a roadmap of prioritized initiatives that will improve data governance, quality and information delivery. Create a multiyear, phased roadmap that clearly lays out the objectives and actions for the first three to six months. The roadmap should describe projects, sequence and high-level activities, timelines and cost estimates. Taking a phased, step-by-step approach will enable you to continually measure your success as you build an MDM solution. Start with an MDM strategy, define business needs and values, conduct vendor and services evaluations, establish governance process, implement in phases and communicate successes and continuous process improvement. The roadmap will ensure a smooth transition from phase to phase based on the conceptual end state.
  4. Separate MDM from operational and analytical applications. Although the MDM is tied to specific business objectives, it is a separate work stream and typically best implemented as a separate application. While developed separately, they need to be tightly integrated into operational and analytical applications, such as customer relationship management (CRM) and business intelligence (BI) applications. Using business drivers to trigger and build pieces of MDM will enable an organization to gradually build a soup-to-nuts MDM solution and not get bogged down in the MDM ROI challenges.
  5. Implementation cycles. If you’ve done your homework by developing a strategy and roadmap as well as choosing the correct partners, the first implementation should be reasonably painless and the foundation for next steps. During the implementation process, take advantage of the resources within your organization because they will be needed for ongoing growth and support, as well as leveraging subject matter experts to help with initial phases and strategies to minimize rework. Most organizations have untapped skills and technologies that can help ease the implementation. Ongoing knowledge transfer is an essential requirement for multiyear, phased IT projects, such as MDM initiatives that use external resources for implementation. Additionally, continually involve the business stakeholders in the project, because they know the processes best and will be affected by the changes the most.
  6. Change management/governance. MDM is as much a process as it is a technology - if not more. Therefore, change management is an essential element of any MDM project. As the way in which existing processes and individuals create and manage master data changes, there is a high probability you will have resistance. You need to anticipate these types of challenges, ensure a clear transition plan has been put in place and communicate the changes, as well as the reasons for the changes and the benefits they will provide.

Defining and designing processes and technologies to enable improved data stewardship and governance for more timely, consistent and accurate delivery as well as reliability of information is critical. Typical governance issues that might arise are determining:

  • Which organization “owns” the shared service of maintaining the master data,
  • What is the scope of the MDM initiative is,
  • How conflicting priorities and timelines are managed,
  • What levels of service and data quality are required,
  • What the responsibilities of the data steward are and
  • How to ensure on going commitment and usage.

As part of the data governance aspect, you will need to:

  • Identify key information entities,
  • Define business owners and stewards,
  • Define new roles and responsibilities of governance,
  • Establish clear and measurable objectives and
  • Communicate effectively to all stakeholders.

Just as with the technical components, a specific governance roadmap focusing on the business processes and ownership should be created as a parallel initiative to MDM implementation.


Suggested governance activities include:

  • Aligning stakeholders,
  • Conducting governance workshops and as-is analyses,
  • Defining business processes and
  • Generating a governance model and applying it in phases.

All business processes require the ability to create use or update some components of master data. If you have a strategic plan and follow these best practices, you’ll be able to lay an MDM foundation with your first phase and continue to grow. Each step in your strategic plan will strengthen your company’s data quality and expand enterprise information management and business intelligence abilities.

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