Master Data Management for Data-Driven DATA MANAGEMENT RESEARC INDUSTRY ANASIS CONSUTING Master Data Management for Data-Driven Organizations Report Summary An ENTERPRISE MANAGEMENT ASSOCIATES (EMA

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  • IT & DATA MANAGEMENT RESEARCH,INDUSTRY ANALYSIS & CONSULTING

    Master Data Management for Data-Driven OrganizationsReport Summary

    An ENTERPRISE MANAGEMENT ASSOCIATES (EMA) End-User Research Report SummaryJanuary 2016

    This research has been prepared for:

  • Table of Contents

    2015 Enterprise Management Associates, Inc. All Rights Reserved. | www.enterprisemanagement.com

    Master Data Management for Data-Driven OrganizationsReport Summary

    1. Master Data Management for Data-Driven Organizations ........................................................... 1

    1.1. Master Data Management: Key to Your Success ................................................................... 2

    2. Being Driven By and Mastering Your Data................................................................................... 3

    3. Agility Propels Data-Driven Organizations ................................................................................... 5

    4. First Step: Fix Key Business Issues ................................................................................................ 7

    5. Maturity: Collaboration and Establishing Accountability ............................................................. 9

    6. EMA Perspective ......................................................................................................................... 11

    7. Methodology and Demographics ............................................................................................... 12

    7.1. Research Methodology ....................................................................................................... 12

    8. Author ........................................................................................................................................ 12

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    Master Data Management for Data-Driven OrganizationsReport Summary

    1. Master Data Management for Data-Driven OrganizationsThe pace of business is moving faster than ever before. Driving this continuing change in pace is data from social, mobile, and other data sources. Organizations leveraging this data are disrupting the way that business conditions and business models are implemented. These organizations are data-driven companies. These companies rely on information on customers, products, and services at a much higher level than traditional organizations to disrupt existing markets and increase their competitive advantage.

    Examples of these data-driven organizations can be seen in multiple markets. Netflix is taking customer, product, and connectivity information to revolutionize the video consumption business. Started as a delivery service that turned the DVD and movie rental business on its head, Netflixs streaming product is now taking the content development and distribution business and making similar disruptions.

    Uber takes information on customers, service providers, and locations to turn the relatively stable and highly regulated business of personal transportation away from consolidated providers. The company enables individual customers and service providers to give highly customized services with a higher customer satisfaction rating than was thought possible in the traditional cab industry.

    Amazon continues its disruption of the online commerce industry by pushing further and further into new markets. With detailed information from customers and products linked with information on supply chains, Amazon continues to push from books to consumer goods to food.

    In each of these instances, data-driven organizations are breaking down barriers to new and innovative markets by accessing a higher level of information and leveraging that information at speeds that previous organizations could only dream of. At the core of this disruption is the ability to provide context for viewing habits, passenger and driver quality, and purchase history. All of these concepts require disruptive, data-driven organizations to have access to the most up-to-date metadata on customers, products, and locations, as well as a robust master data management (MDM) practice to leverage that information in the right places and at the right times.

    Data-driven organizationNoun

    : a company that has either fully integrated data or started with data as the basis for its strategic and operational thinking. The organization uses data and information for finance, marketing, sales, and operations decisions and has built new business models in existing markets using data and information.

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    Master Data Management for Data-Driven OrganizationsReport Summary

    1.1. Master Data Management: Key to Your SuccessUtilizing up-to-date information on products lets data-driven organizations capitalize on initial purchases to improve cross-sell/upsell opportunities. With this curated information, a data-driven organization can not only make the most effective offer to a prospective customer, but can also ensure offers are made with the products that are available to and cost-effective for the provider.

    The connection between master data management and data-driven cultures lets organizations take a new approach to the 360-degree view of a customer. Prior to all of these new mobile, social, and location data sources, the 360-degree view of a customer was from inside the organization via customer care, enterprise resource planning, and other inside the firewall sources. With these new data sources and a strong master data management practice, data-driven organizations can redefine the 360-degree view of the customer to include their opinions about products and services in near-real time. The 360-degree view can include an increased velocity of purchasing decisions from mobile applications and can even determine where customers are interacting with the physical brick and mortar as well as the online and mobile touchpoints.

    DIGITAL

    MARKETING

    61.5%

    NEW

    DATA-DRIVEN APPS

    48.8%

    CUST

    OMER EXPERIENCE

    52.6%

    The graphic above shows the top three business goals for organizations that have a strong approach, or vital stance, on the use of master data in their organization to boost support of Digital Marketing efforts, enhance Customer Experience, and expand into New Data-Driven Applications. These organizations drive their businesses by focusing on the way they can leverage their data assets to provide better products and services to their customers.

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  • PAGE 3 2016 Enterprise Management Associates, Inc. All Rights Reserved. | www.enterprisemanagement.com

    Master Data Management for Data-Driven OrganizationsReport Summary

    2. Being Driven By and Mastering Your DataEMA recently performed primary end-user research on the implementation of master data management practices in relation to data-driven organizations and their cultures. This research focuses on how data-driven organizations are taking a renewed look at the practices associated with master data management to effectively implement their disruptive business models and drive their revenues up and their costs down while improving their overall customer experience and satisfaction.

    Data-driven strategies within respondent organizations have been banded together into the following segments to detail different levels of organizational culture.

    Vital These data-driven cultures view the use of data as being paramount to how they drive revenues and customer satisfaction. These respondents replied that their data-driven strategy is currently adopted and a vital part of our business.

    Important These organizations have integrated data-driven strategies into their culture, but have not taken it to the level of those identified as vital. These respondents identified it as being currently adopted and a somewhat important part of our business.

    Adopted or Researched These organizations are still working out how to implement data-driven strategies in their organization. These respondents indicated it is currently adopted; it is planned for adoption in the near future (3-6 months); or it is being researched for adoption in next year (6-12 months).

    The EMA respondent panel was asked how they evaluate their own data-driven strategies across a continuum. This provides a breakdown of this segmentation to see where participating organizations fit along the continuum detailed above.

    How would you describe the extent to which your company is using a data-driven organizational strategy?

    0% 5% 10% 15% 20% 25% 30% 35% 40%Percentage of Respondents

    Vital

    Important

    Adopted or Researched

    38.2%

    28.4%

    33.3%

    Data-Driven Culture

    Data- Driven CultureVital

    Important

    Adopted or Researched

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    Master Data Management for Data-Driven OrganizationsReport Summary

    Almost 40% of respondents identified that data-driven organizational strategy is vital to their success. This is closely linked to the number of respondents who have a proactive approach to the master data management practice. Survey participants were asked:

    How would you describe the extent to which your company is implementing master data management practices and technologies for customer-facing applications?

    0% 5% 10% 15% 20% 25% 30% 35% 40% 45%Percentage of Respondents

    Vital

    Important

    Adopted or Researched

    41.2%

    28.4%

    30.4%

    Master Data Management Strategy

    MDM StrategyVital

    Important

    Adopted or Researched

    The levels of master data management practices and technologies being implemented within an organization have been banded together into the following categories.

    Vital These are companies where master data management strategies are an important part of their data management practices and are key aspects of how they address the domains of MDM. In these organizations, master data management is identified as currently adopted and a vital part of their business.

    Important These organizations have a significant investment in MDM. However, they are still working toward the vital level. These respondents identified their master data management strategy as being currently adopted and a somewhat important part of their business.

    Adopted or Researched This level of MDM strategy is similar to that of an adopted data-driven culture with organizations dabbling in their MDM practices. These respondents indicated it is currently adopted; it is planned for adoption in the near future (3-6 months); or it is being researched for adoption in next year (6-12 months).

    Vital data-driven cultures and strong MDM practices are closely linked both in concept and in response rate in the EMA survey. Organizations with vital data-driven cultures believe in the use and proliferation of data to further their business models and create new opportunities. They believe that without access to the latest information on MDM domains such as customer, product, and region, their organizations will only achieve limited success with their data-driven initiatives.

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    Master Data Management for Data-Driven OrganizationsReport Summary

    3. Agility Propels Data-Driven OrganizationsFocused, data-driven cultures have much higher requirements to achieve an effective master data management strategy than other organizations. Data-driven cultures embrace the usage of data sources that previously were unfamiliar to organizations. They use multistructured data sources as well as data sources from outside of the corporate firewall. Data-driven organizations will also incorporate this information into a larger number of customer-facing applications in comparison to organizations with a lower focus on data-driven concepts. The net effect will be to not only increase the types of information the organization receives, but to also vastly increase the numbers of touchpoints where those data sources can make a difference with customers. Finally, these varied and numerous data sources will be pushed out to these customer-facing applications more frequently than organizations that only pull data from inside the corporate firewall.

    As part of the EMA research, panel respondents were asked:

    From which of your data sources do you integrate information for your master data management practices associated with customer-facing applications?

    By looking at this response in relation to the segments associated with data-driven cultures, it is clear that, for data sources outside the corporate firewall, an overwhelming majority of the responses are from organizations with vital data-driven cultures.

    0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Percentage of All Mentions

    Operational application data (e.g., point of sale, customercare, CRM, supply chain)

    Data from customer touch points (e.g., feedback fromsurveys, data from call centers, outbound campaigns, etc.)

    Human-generated documents (e.g., email, application formdocuments)

    External augmentation data (e.g., demographic orpsychographic)

    Social media data (Twitter, Facebook, forums, etc)

    35.2%

    24.5%

    34.7%

    18.2%

    17.9%

    29.6%

    30.6%

    24.5%

    21.2%

    21.4%

    35.2%

    44.9%

    40.8%

    60.6%

    60.7%

    Master Data Management Data by Data-Driven Culture

    Data- Driven CultureAdopted or Researched

    Important

    Vital

    More than six of 10 responses from the EMA survey panel in both external augmentation data and social media data were from those respondents in vital data-driven cultures. This is in stark contrast to other levels of data-driven strategies that favored the more familiar data sources from within the data center, such as operational application data, information from customer platforms, or human-generated documents.

    Customer-facing applicationsNoun

    : applications that directly interact with customers or revenue-generating business partners. These applications will have online and mobile aspects to meet the needs of the customer. These applications can include inbound or outbound marketing, ordering systems, customer support, and product information platforms.

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    Master Data Management for Data-Driven OrganizationsReport Summary

    Data-driven organizations within the vital category also leverage data more broadly across various platforms to provide a more comprehensive look at their customers. These organizations seek additional data sources to be included in their customer-facing applications. The EMA research panel was asked:

    How many customer-facing applications need consistent master data such as customer, product, and/or location data?

    Organizations with vital data-driven cultures represent over 60% o...

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