wp_iway_mdm
TRANSCRIPT
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A White Paper
Boost the Value of Information With Master
Data Management
by J.T. Taylor
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J.T. Taylor is the chief technology officer of iWay Software, an innovator
of enterprise integration solutions. Mr. Taylor brings more than 25 years
of experience in information technology to his position, with 14 years in
the commercial software industry developing and marketing enterprise
products. Strategically focused and internationally experienced, Mr. Taylor
is a recognized industry leader with extensive experience in the application
integration, systems management, and Internet e-commerce markets.
Prior to joining iWay Software, Mr. Taylor was the founder and CEO of
Semantic Solutions, an independent software vendor and reseller targeting
the application development market. Previously, he held the position of
senior director of Global Product Marketing and chief sof tware architect
at Software AG, a $2 billion independent software vendor in the database,
application development, and application integration markets. Prior to
Software AG, Mr. Taylor was vice president and chief technology officer of
SingleShop, an Internet e-commerce startup, responsible for development
and support of the companys innovative software as a service (SaaS)
e-commerce products. Mr. Taylor is a decorated veteran of the U.S. Army.
J.T. Taylor
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Master Data Management: What It Is and Why You Need It
How Master Data Management Works
The Primary Business Drivers and Requirements Behind MDM
Synchronization: One of MDMs Greatest Challenges
Data Quality Management and MDM: What Is the Correlation?
Master Data Management: A Real-World Scenario
iWay Master Data Center
Conclusion
Table of Contents
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Information Builders1
Master Data Management: What It Is and Why You Need It
Master data management (MDM) is a comprehensive, enterprise-wide technique that comprises
data governance, distribution, and administration. It is designed to improve accuracy and
streamline sharing by seamlessly linking together and synchronizing the disparate information
that exists across a business. With MDM, universally accepted values for key data elements are
created, providing all users throughout an organization with a single, correct, up-to-date version of
vital business information that can be instantly retrieved and leveraged at any time.
As companies expand, merge, and/or globalize, corporate technology environments continue
to become more and more sophisticated. They contain a larger and more complex network of
diverse applications and databases than ever before systems that are frequently housed in
geographically dispersed locations, maintained by dif ferent teams, and seldom well-integrated or
synchronized. The results of this can be disastrous. Information thats outdated or inaccurate will
be used to make critical business decisions or develop important corporate strategies. Users wontbe able to access the data they need, when they need it, to perform their day-to-day business
activities. Cross-department collaboration will be nearly impossible due to inconsistent versions of
the same information (multiple versions of the truth).
An effective MDM plan can change all that. Companies who define and implement broad-
reaching master data management strategies can realize significant benefits, including greater
visibility into core operations, improved information accuracy and consistency, increased
productivity (particularly for those processes that are highly information-centric), and enhanced
data exchange within and beyond the company. Perhaps the most important advantage of MDM
is its ability to mitigate corporate risk, increasing the success of compliance initiatives by ensuring
the quality of information delivered in response to regulatory reporting guidelines.
Master Data Defined
There are many vague and unclear definitions of master data available from a variety of sources,
leaving companies unsure exactly what constitutes master data. In the simplest terms, master data
is a single set of information elements and all related metadata and attributes (definitions, roles,
taxonomies, etc.) that have been synchronized from similar records located in various systems
and applications across a business. Once master data is generated, it is closely governed to ensure
consistency among all sources where equivalent data is stored.
Master data objects should be created for those common data sets that exist in some form
or another within numerous databases and sources. For example, client information is often
stored in customer relationship management (CRM) systems, as well as accounting and billing
applications, help desk systems, etc. The creation of a master data object for each customer would
help ensure that the information about that customer is correct and consistent across those
multiple sources.
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Boost the Value of Information With Master Data Manageme2
In addition to clients/customers, most companies maintain the following data in multiple disparate
sources, and should create master data objects for each related record:
Products. Product data often exists in systems, such as engineering, production, sales, and
inventory management
Parts/materials. Information about the countless components used in the manufacturing
process or the office supplies a company keeps on hand to support day-to-day activities can
typically be found in inventory, production, and procurement systems
Suppliers/vendors. Accounting teams, as well as engineering and production departments,
often keep data about suppliers and vendors in their various business applications
Employees. Employee data is stored in human resource management applications, IT help desk
systems, payroll packages, and other disparate databases
Branches/stores/locations. Data about the various offices and branches a company
operates may exist in sales, shipping and distribution, human resource management, and
accounting applications
These items are ideal candidates for master data and can typically be found in virtually any
organization. However, master data strategies are flexible and can be easily made to conform
to any unique or specific business need. In fact, nearly any item, person, or process described in
corporate information sets can be incorporated into a master data plan.
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Information Builders3
Master data management is a combination of processes and technologies that enable the
creation of a single system of record. A golden record that provides a set of validated, universally
recognized values, derived from the various sources that house similar information, and that
has been reconciled and stored in a centralized hub to be used as a primary frame of reference
by all enterprise users and systems. It will feed complete, consistent, and correct data back to
applications and databases across an entire business.
For example, a healthcare organization may create a golden record for each patient, which would
then feed all correct, consistent contact details and insurance information back to billing, clinical,
and other systems. A manufacturing firm may need one golden record for each product, including
components, design and engineering specifications, and pricing, which would be seamlessly
shared among sales, inventory, procurement, production, and other related applications.
Before we continue discussing how it works, it is important to stress the importance of
maintaining the integrity of golden records once they are created. Keep in mind that a single error
in master data, no matter how small or seemingly insignificant, will multiply exponentially, causing
errors in every system that uses it.
Once golden records have been created, there are five primary ways to manage master data
throughout a business:
Consolidation
A single, physical instance of master data is created and maintained. Updates to master data are
made at source systems, then transferred back to the central repository.
How Master Data Management Works
Source
Master
Source
Source Source
Master is single version of truth
Data quality management at master
Updates occur at sources
Updates propagated to master
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Boost the Value of Information With Master Data Manageme4
Registry
All master data resides in its original databases, while a virtual repository of keys is maintained to
aid in the synchronization of MDM records across different information assets. When an update is
made to master data at its source, it is harmonized with the associated key and then redistributed
among other related back-end systems.
Coexistence
All master data attributes are stored in a central repository, but the master data itself can be
generated, stored, and updated either in the MDM database or within the individual applications
and back-end systems. Changes, regardless of where they are made, are dynamically disseminated
among related sources.
Master
Source Source
Source Source
Multiple versions of truth
Data quality management is ongoing
Updates occur at sources
Keys and metadata updated in registry
Updates propagated to other sources (optional)
Master
Source Source
Source Source
Master is single version of truth
Data quality management is ongoing
Updates occur at sources or master
Updates propagated to other sources
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Information Builders5
Transaction
Master data is read and written to a central repository in its transactional context, in real time uponevent execution. Updates are also managed at the source and propagated to the MDM database.
Data Synchronization
Asynchronous harmonization of master data dynamically occurs, in batch, among systems across
the entire infrastructure. Updates are recorded at the source, then shared with other sources at
pre-determined intervals.
There is no right method when it comes to master data management. What will work best for one
company may be the wrong approach for another. In order to choose, according to renowned
industry blog BeyeNETWORK,1 firms need to carefully evaluate their unique and specific master
data management needs, such as:
Timeliness: the speed at which new master data must be available within the environment
Latency: the desired time for master data to be delivered when requested
Currency: the frequency at which master data should be refreshed
Consistency: the degree to which each applications view is like others across the enterprise,
and/or the ability of the environment to return the same results each time data is requested, no
matter which sources are queried
No matter which style of MDM an organization chooses, a common, standardized master data
model is a crucial element. Although it will serve different purposes in different strategies, an
MDM model ensures seamless synchronization of all master data among the countless operational
systems that use it. For example, when the consolidation method is used, the master data
model acts as the hub database, which shares its information with various back-end systems. In
the registry approach, the master data model is used for building queries that will collect and
transform related application data. For companies that choose the coexistence model, the MDM
model will serve as a hub for storing common information attributes. Unique data characteristics
are mapped and transformed back to the data model, much in the same way that queries gather
source data in the registry approach.
1 Loshin, David. Master Data Synchronization Assessing Requirements, BeyeNETWORK, January 2008.
Master
Source Source
Source Source
Master is single version of truth
Data quality management at master
Updates occur at master
Updates propagated to sources
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Boost the Value of Information With Master Data Manageme6
A recent analyst survey ranked the top business drivers behind the adoption of master data
management. Respondents cited cost optimization and ef ficiencies, compliance and risk
management, and revenue and profit growth as the key reasons behind their MDM strategies.2
A similar report by the Aberdeen Group cites the following as the primary reasons behind many of
todays MDM initiatives: 3
Competitive growth and profitability
Increasing customer demands
High data management costs
Regulatory compliance
Low sales conversions
Customer defections
The requirements that create a true urgency for MDM across an organization can be viewed from
three distinct perspectives business, IT, and data.
Business
Master data management can solve many business challenges and goals. By enhancing the
consistency and correctness of information as it f lows across and beyond a business, organizations
can dramatically improve:
Risk and fraud mitigation
Compliance with Sarbanes-Oxley, Basel II, and other regulations
Functional initiatives, like sales and marketing programs
Corporate-wide performance management
Mergers, consolidations, and acquisitions
IT
Master data management can play a crucial role in a variety of mission-critical IT initiatives. In fact,
many companies deploy their MDM solutions in conjunction with important technology projects,
including:
Infrastructure overhauls such as the creation of service-oriented architectures (SOAs) or
the implementation of enterprise resource planning (ERP) packages and other front-end
applications. Analysts predict that by 2012, 70 percent of complex SOA projects will compromise
business goals unless MDM is implemented
Consolidation of disparate architectures as a result of mergers and acquisitions
Systems integration efforts
The Primary Business Drivers and Requirements Behind MDM
2 Master Data Management Business Drivers, All Things Data, May 2009.
3 Master Data Management: The Approach Determines the Results, Aberdeen Group, May 2008.
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Information Builders7
DataCompanies who embark on master data management plans will realize more significant return on
many data-related initiatives, such as:
Governance
Quality management
Data enrichment and extension via third-party sources
Single view of customer, patient, etc.
Application migrations
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Boost the Value of Information With Master Data Manageme8
Effective data management doesnt end once a golden record is created. One of the most
important aspects of MDM and one of the biggest issues companies face when it comes to
implementing their policies and associated framework is finding the best way to maintain those
golden records on a continuous basis and synchronize them with the various systems that exist
across the business.
To achieve enterprise-wide coordination and propagation of correct and consistent information,
formal policies for making changes to existing master data as well as adding new master data to
the environment, then distributing those updates across the countless sources that likely exist,
must be well-defined and implemented.
Two of the key processes that must be addressed include:
Changes and Updates to Records
Information environments are highly dynamic and changes and updates are frequently made to
master data as well as to data contained in back-end applications. Companies must determine
exactly how those modifications will impact the rest of the infrastructure. For example, which
system is considered the system of record for all others to be validated against, or updated as
needed, for the purposes of synchronization? How will changes to master data be propagated
across source databases? Or, how will alterations made by end users directly in transactional
applications be verified against master data and shared among master data repositories and other
enterprise systems?
Rules that address these questions must be outlined as part of the overall master data strategy.
Additionally, the technologies chosen to support the MDM plan must automate the definition
and invocation of these rules the instant information is modified, to ensure ongoing accuracy and
integrity, even as enterprise information continuously changes.
Synchronization: One of MDMs Greatest Challenges
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Information Builders9
Splitting RecordsIn many scenarios, duplicate records are uncovered during the course of master data management
efforts and are then joined together for the sake of consistency. For example, various systems that
house customer information may contain records for a John W. Smith. If these records contain
similar details, it may be determined that they are, indeed, the same client. The golden record will
then be created, unifying the information that existed in the separate records, and distributing it
among all enterprise source systems.
However, as new information enters the environment, it may become clear that there are, in fact,two separate and distinct customers named John W. Smith. Supporting technologies must then
be able to split these records back up, using a full data lineage to determine where each portion of
the joined record came from, so the right information makes its way back into the right systems.
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Boost the Value of Information With Master Data Manageme10
Few companies incorporate data quality management into their MDM strategies. What they dont
realize is that while the efficiency in which master data is generated and maintained is important,
it is the quality of that master data that will make or break an MDM initiative. In fact, in a recent
article, Rob Karel, a principal analyst at Forrester Research, claimed that data quality is core to
delivering effective master data.4 Therefore, in order to succeed with MDM, companies need to
include data quality and validation techniques as a key part of their overall plan.
Data quality is so important to master data management because so many disparate sources and
types of data will be involved. Application data from back-end systems, transaction data collected
during the course of live events, and even the metadata and reference data used to describe the
attributes of all this information, will play a huge role in the creation and administration of a single
set of data values across the business. If the source data is bad, the master data generated from
it will be too. This, in turn, will negate the benefits of MDM, causing problems throughout thebusiness as incorrect or outdated information is leveraged during the course of core operations.
BeyeNETWORK stresses the importance of data quality in MDM efforts, citing the maturity of a
companys data quality and governance policies as a key indicator of its MDM readiness.5
The companies who derive the greatest value from their MDM initiatives are those that make
comprehensive data validation and quality management solutions part of their MDM framework.
To be truly effective and promote data integrity across all back-end systems as well as all master
data repositories, these tools must do more than just scan existing data to uncover quality
problems. In fact, they must even go beyond the automatic correction of issues once they
are uncovered, such as dynamically reformatting or restructuring values based on predefined
guidelines. Instead, they must use advanced business rules and quality control techniques toprevent bad data from entering the environment in the first place. Only through this type of
proactive data governance can organizations fully ensure the quality of master data throughout
the enterprise.
Data Quality Management and MDM: What Is the Correlation?
4 Kelly, Jeff. Master Data Management Market Trends and Expert Forecasts for 2009, SearchDataManagement.com,
January 2009.
5 Loshin, David. Master Data Management Readiness, BeyeNETWORK, June 2008.
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Information Builders11
Now that weve covered what master data management is, what the benefits are, and how it
works, lets see what it can really do when applied to real-world business environments. In our
experience, customer is one of the most common and most critical master data objects,
so well follow a fictional business, Company XYZ, looking to create a single, accurate record for
each of its clients. Since the financial services industry is experiencing massive consolidation,
globalization, and merger activity all of which make master data management a necessity in
order to maintain information consistency across disparate, geographically dispersed offices and
business units with diverse technology infrastructures lets assume that Company XYZ is a bank.
In an effort to expand customer wallet share, Company XYZ wishes to embark on targeted
promotional campaigns designed to up-sell and cross-sell various products and services to
existing business account holders. Because the company recently merged with two other financial
institutions, it is struggling to unify disparate technology architectures with highly diverse sales,marketing, and customer relationship management systems. The main challenge they face is
obtaining a single, consistent view of each client. Questions such as who is the primary contact?,
where is headquarters located?, and what products and services do they already have? are
difficult to answer, because information varies greatly from one source to the next.
An initial attempt to consolidate information from various systems into a centralized data
warehouse failed to minimize inconsistencies across data records and resulted in numerous
duplicate entries. The problematic information contained in the warehouse would have made
effective campaign planning and execution nearly impossible, and the marketing team would
have been challenged to achieve its desired goals in terms of response and conversion rates.
So, Company XYZ embarked on a broad-reaching master data management effort. The first stepwas to cleanse and standardize customer contact information and other details across all back-
end databases more than a dozen in total. A hub solution, complete with a single, centralized
master data repository that feeds complete, accurate information back to source systems in batch
mode, was implemented. The strategy also included fully integrated data quality process support,
using such features as merging and matching to cleanse and validate existing data, as well as
advanced business rules to ensure the integrity of new data as it enters the environment.
By enhancing the consistency and quality of customer data across the enterprise, Company
XYZ was able to provide its marketing team with the information it needed a single, correct view
of each customer across all business units to deploy targeted, effective up-sell and cross-
sell programs.
Master Data Management: A Real-World Scenario
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Boost the Value of Information With Master Data Manageme12
Cutting-Edge Solution for Comprehensive, Broad-Reaching Master DataManagement
iWay Softwares Master Data Center (MDC) is an innovative, specialized technology that can help
companies overcome data consistency challenges by delivering the highest quality master data.
Powerful, reliable, and designed to integrate seamlessly with existing systems through iWays
extensive suite of adapters, iWay MDC leverages advanced, yet easy to define business rules that
aid in the consolidation of millions of records. As a result, unified and validated master data is
instantly available to ERP and CRM systems, self-service portals, analytical tools, data warehouses,
and other enterprise applications.
iWay MDC is built on a component architecture that can easily plug and play into any technology
environment. Its main modules include:
MDC Storage, which houses and manages original records waiting to be processed, as well as
records that have been validated and consolidated. Pre-defined and customizable vertical data
models for key master data objects, such as customers, contacts, and products, are utilized
MDC Master Data Services, used for processing and maintaining master data. It is comprised of
more than 100 elementary and component methods that can be fully configured directly from
the administration console
MDC Data Quality Services, data process, and quality measures, such as automated record
verification, designed to improve information integrity
iWay Master Data Center
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Information Builders13
MDC Adapters, industry-standard interfaces that enable bidirectional connectivity to virtually
any application or data across an enterprise
MDC Master Data Manager, an interface for business users and data stewards that provides
intuitive visualization and job management
MDC Hierarchy Manager, a specialized interface for more advanced end users who need to
oversee jobs dealing with hierarchal master data, such as product categories or organizational
structures
MDC Metadata Interface, which allows users to export metadata from iWay MDC to other
systems and metadata repositories
MDC Server, a Java TM server platform for on-demand processing that integrates with iWay Service
Manager, IBM WebSphere, BEA WebLogic, SAP NetWeaver, and a variety of other IT infrastructure
logging and monitoring servicesMDC Repository, an internal repository used in on-demand application mode to optimize and
accelerate data access
Todays Most Robust, Feature-Rich MDM Environment
iWay MDC is packed with powerful, state-of the art functionality to address even the most
sophisticated and complex MDM needs. Key features include:
Vertical business models for healthcare, financial services, insurance, and government that have
been optimized for customer, contact, and product. These leverage pre-defined and pre-
configured master data management services, including profile searches and unification with
additional business entitiesAdvanced data quality and unification techniques designed specifically for customer data
A Java-based infrastructure based on open standards that is fully compatible with a wide range
of popular platforms. This accelerates deployment by simplifying integration with existing
IT infrastructures
Bundled administration applications for fast and easy configuration and operation, without the
need for third-party tools
Parallel data processing methods that ensure maximum scalability, as well as full support for
incremental data processing in batch or on-demand online modes using ETL, ESB, or SOA-
style integration
And best of all, iWay MDC combines power and functionality with affordability and budget-friendliness simplifying project complexity and reducing the time from initial development to
delivery, at a fraction of the cost of other tools.
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Boost the Value of Information With Master Data Manageme14
A Critical Part of Any Information Management StrategyMaster data management is a key component of any broad-reaching enterprise information
management (EIM) strategy. EIM combines the principles and technologies of enterprise
integration, business intelligence, and content management to streamline and formalize the
activities associated with data generation, storage, access, and handling. As a result, companies
can boost the value of their corporate information, tapping into it to gain a substantial competitive
edge through increased operational productivity, reduced overhead costs, and better business
performance. iWay Software offers a comprehensive portfolio of tools and solutions to support all
aspects of EIM.
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Conclusion
Information Builders15
Master data management (MDM) is a comprehensive technique that synchronizes similar
information across disparate sources to ensure enterprise-wide information consistency, no
matter how complex or multifaceted the underlying technology environment is. By creating a
single, accurate reference point for all common data elements such as customers, products, or
employees MDM can help organizations to enhance productivity and operational performance
by improving information accuracy and data exchange within and beyond the company.
Additionally, MDM can significantly mitigate corporate risk and boost the effectiveness of
compliance efforts.
There are many challenges when it comes to designing, deploying, and administering an MDM
strategy. There are many different MDM models to choose from and companies must closely
evaluate each, compare them with their unique business and information requirements, and
determine which approach is the best for them. They also must outline and prioritize the keycandidates for master data within their business.
Additionally, firms must think beyond the initial creation, storage, and dissemination of master
data, and clearly define how it will be updated, expanded, and maintained on an ongoing basis, to
ensure continued success of the plan. Finally, they must select the right tools and technologies to
support their MDM initiative.
iWay Softwares Master Data Center (MDC) is a powerful, comprehensive MDM platform that
addresses data consistency challenges by delivering the highest quality master data. With robust
features, a modular plug and play design that facilitates seamless integration with existing
infrastructures, and the flexibility to support virtually any MDM approach, iWay MDC makes
unified and validated master data instantly available to ERP and CRM systems, self-service portals,analytical tools, data warehouses, and other applications throughout an enterprise.
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Kista 46-735-23-34-97
Taiwan Galaxy Software Services
Taipei 886-2-2586-7890
Thailand Datapro Computer Systems Co. Ltd.
Bangkok 662-679-1927, ext. 200
Turkey InfoBuild Middle East
Ankara 90-312-266-33-00
Istanbul 90-212-325-4114
United Arab Emirates InfoBuild Middle East
Abu Dhabi 971-2-627-5911
Dubai 971-4-3914391
Venezuela InfoServices Consulting
Caracas 58-212-763-1653
* Training facilities are located at these branches.
DN3601401.0110