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the latest reports shows that the global master data management (MDM) market is expected to reach $27.9 billion by 2025. Given the huge amount of data being generated — 1.145 trillion MB per day — The growth of the MDM market is inevitable. Supported by new data-intensive technologies such as artificial intelligence (AI), machine learning (ML), internet of things (IoT), robotic process automation (RPA), augmented reality (AR), virtual reality (VR) and social media platforms, this market is ahead of the curve. It will continue to grow at an unimaginable rate these days.
Why is a successful MDM strategy critical to your business?
Organizations need robust data management capabilities to make better business decisions, increase operational efficiency and deliver superior customer experience (CX). This is where MDM comes in — creating a single, consistent and reliable master data source that you can use to your advantage — accurate reporting, lower costs, increased productivity, faster time to market (GTM) and more sales and revenue.
What does a successful MDM strategy look like?
Simply put, a solid MDM strategy is the hallmark of success for businesses across industries. So let’s take a look at the five pillars of a successful MDM strategy:
- data management: Provides a framework for defining rules regarding data governance, data quality, access controls, regulations, and privacy policies, which are the foundation of all successful MDM strategies. Governance also helps determine who is responsible for ensuring the availability, availability, security and integrity of data within your organization.
- data management: Building on governance, it is important to involve the right stakeholders and ensure that regulations and policies are enforced throughout the organization. This is essential to ensure that business users always have access to clean and accurate data.
- Process: The success of data management relies on establishing well-defined processes to monitor compliance and increase the value of data. An effective MDM strategy should outline the data consolidation, management, and diffusion process.
- Standards: Once processes are defined, guardrails or standards – both internal and external – must be created around them. While external standards are required to ensure regulatory compliance, internal standards help maintain clean, accurate and consistent data throughout the organization.
- technology: The fifth pillar of a successful MDM strategy, technology has transformed from being a mere facilitator to a game changer for organizations seeking to realize the total value of data in driving their business goals. Besides strategy, other key considerations such as organizational culture, data maturity, stakeholder consensus, and internal skills influence the selection of the right MDM technology.
How does MDM make a difference?
Measure improvement of data quality or data silos issues
Studies It reveals that poor data quality causes at least 19% of businesses to lose customers. Inaccurate and substandard data not only cause job losses, but also increases risks and lowers return on investment, says Gartner. The challenge with low quality data can be effectively overcome by implementing a robust MDM solution that checks the data for completeness, accuracy, repetition, integrity, consistency and relevance and improves data portability in the process.
An effective MDM strategy is built around solving one of the inherent problems businesses face: eliminating corporate data silos. Data locked in different databases can cause operational inefficiencies and 20-30% loss of annual income. Implementing an efficient MDM system can close this revenue leak by removing data silos, facilitating data consolidation, reducing data retrieval time, and making data available for collaboration between internal business functions and external partners.
Evaluate how your team uses data better
MDM helps reduce data errors, duplication, and inconsistencies by breaking down data silos and increases productivity by providing a single source of truth that enables your team to better use data. IT owners can optimize applications and systems with a unified view of enterprise infrastructure, while marketing and sales teams leverage a 360-degree view of customer data to run more targeted campaigns for cross-sell and upsell.
Using a centralized system and a common enterprise-wide set of methods to retrieve and analyze data leads to performance improvements. Studies show that 80% By leveraging a single unified master data source, some of the managers can improve their performance and exceed their business goals. Using MDM not only improves data quality (65%) and portability (62%), also helps better data usage, which results in faster delivery of information (62%).
Analyze before and after operational efficiency improvement
Despite increasing demands for business insights based on near real-time data, many organizations still use manual processes and rely heavily on emails, spreadsheets and calls to collect and share various types of data across business functions. This lengthens consensus cycles and results in skewed and unreliable data reporting. Without access to a centrally managed and trusted standard reference, it is difficult to maintain consistent data across the enterprise.
Therefore 68% Percentage of business leaders invest in data management solutions, according to Dun & Bradstreet. MDM improves performance agility by improving collaboration between people, applications, and systems, and integrating disconnected processes to better manage workflows. It ensures that business applications within an organization are fully aligned with each other to ensure a clean and usable flow of data between multiple applications. 28% reduction in operating costs from year to year (Annual).
Track improvement in customer experience
Dealing with “rogue” customer data such as siled, duplicate and asynchronous customer information is one of the biggest challenges facing global brands today. Studies tell us that an organization will likely have 20% to 40% of duplicate customer records, resulting in millions of dollars in annual losses. Also, such inaccurate, fuzzy customer data inevitably results in loss of sales and marketing efforts, poor customer service, and large numbers of dissatisfied customers – a CX nightmare.
As 73% Data management emerges as an important differentiator as customers make purchasing decisions based on experience. MDM allows sales teams to access clean, non-duplicated, holistic customer data that helps rationalize account planning, improve sales, and increase customer profitability. MDM allows marketing to drive highly personalized and targeted CX initiatives to improve customer satisfaction (CSAT) scores. With trusted customer records, brands can also explore cross-sell and upsell opportunities to improve customer lifetime value (CLV).
Measure the impact on ROI and business growth
In a world where businesses thrive with data-driven insights, there is little room for error. Unfortunately, incorrect data hurts return on investment (ROI) – the cost of bad data is worrying. 15% to 25% While it is sometimes difficult to measure the exact return on investment for most organizations, studies Prove that best-in-class organizations leverage relevant and accurate data-driven insights to create real business impact and drive revenue growth (YoY) of 28%.
Analyzing business metrics associated with financial results before and after an MDM implementation helps you determine the value of managing data in realizing return on investment. To realize this value – and the competitive advantage it brings – organizations must overcome existing data management challenges by investing in a robust MDM strategy that includes data quality standards, data governance and validation rules to reduce business performance risks and drive revenue growth.
Long-term MDM strategy
Reliable master data is the lifeblood of any successful business today. Most organizations are actively seeking opportunities to combine more data to support key decisions. They demand increased data availability and fewer barriers to data sharing. Here, a long-term MDM strategy aligned with business growth goals separates leaders from those who lag behind.
Vandana Singal is director of solutions consulting at Pimcore Global Services
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