Upload
verdantis
View
447
Download
1
Embed Size (px)
DESCRIPTION
Tips & tricks to drive effective Master Data Management & ERP harmonization
Citation preview
Quality Master Data for Improved Business Performance
Tips & Tricks to drive effective Master Data Management & ERP Harmonization
Hosted By:SAPinsider
Master Data Performance Solutions
Verdantis, Inc. is the evolution of Zynapse – a division of Zycus, Inc. to its own company with its own corporate
identity
Verdantis comes from the Latin word for truth – veritas - and the word verdant – meaning abundant and
sustainable
Today Speakers
Jeffrey KarsonProject Manager, Business IntegrationSiemens Water Technologies Corp. About Jeffrey KarsonJeffrey is a Project Manager at SWT which is a division of Siemens AG. He has been active in the area of project management and material management for over 15 years. His current responsibilities involve the implementation of a new ERP system (SAP) at Siemens Water Technologies with focus on the loading of harmonized master data.
Arthur RaguetteVice President, Business DevelopmentVerdantis Inc.
About Arthur Raguette Arthur Raguette drives strategic partner development, industry alliances, and new business initiatives for Verdantis. His career of creating collaborative business relationships that deliver enterprise-class master data management and spend management solutions to Global 2000 customers spans over 15 years.
Unlocking ROI from ERP Investments – The Master Data Management Story
Arthur RaguetteExecutive Vice PresidentVerdantis, Inc.
Introduction
• ERP Systems Are Indispensable to Business Operations in Large
Organizations
• Master Data Quality affects the Accuracy, Efficiency, and Reliability of
business processes
• Master Data Has a Material Impact on the Financial and Operational
Health of an Organization
• Consistent Data Management keeps Enterprise Applications in Shape
• Master Data Rationalization Is a foundation for increasing the ROI of an
existing ERP Investment
The Role of Master Data in the Enterprise
The items it makes
The items it buys
The employees who work there
The customers to whom it sells
The suppliers it buys from
Master Data Quality Issues Ripple Across the Enterprise
A Challenge of Master Data in the Enterprise
Customer Master CRM Teams
Vendor Master Procurement/Accounts Payable
Item Master No clear Owners
A disorganized approach toward Maintaining Master Data Is more common than you may think…
Multi-domain MDM Challenges
Business StakeholdersEnterprise ApplicationsInformation Technology
Has specific functionality Rules in its own fashion Handles the business
context of data Individual understanding
of data attributes
Global Data Synchronization
Processes related to Customers Materials Products/Services Vendors
Information is inconsistent across the organization
Sharing and synchronizing information across enterprise applications further creates complexities
Conflicting data across business factions Lack of stakeholder ownership Delayed request for information Lost ROI from ERP investment
Hete
rogeneit
y
Current Issues in Master Data Success: The Root Cause is Data Quality
•Various master record formats
•Various systems of record
•Incongruent naming standards or no naming standard
•Lack of a standardized classification convention
•Incomplete fields and missing data elements
The Effect of Bad Master Data on Business Initiatives Is Profound
• Merger and Acquisition Activities
• ERP System Consolidation
• Enterprise Spend Management
• Sourcing Strategies and the make-v/s-buy process
• Inventory Visibility
• Decreased Plant and Equipment Availability
• Part Reuse in Design
• Decreased Employee Productivity
Incomplete Approaches towards Master Data Rationalization
ETL Solutions(Extract, Transform, Load)
These solutions are too generic in functionality to deal with the complexities of item master records. ETL solutions do not perform classification and attribute enrichment. Moreover, there is considerable effort and expense in setting up these solutions for repeated use.
Asset Management Solutions
Asset management solutions typically target only a subset of item master data, namely MRO (maintenance, repair, and operations) items. This isnot sufficient for ERP consolidation or for comprehensive spend analysis. In addition, there is significant manual effort involved.
Commerce Catalog Solutions
Commerce catalog solutions tend to focus only on the items sold, rather than those procured. These solutions are less experienced in tapping the various internal and external sources of item data and fail in the subject-matter expert department. Furthermore, they do not automate the attribute enrichment, automating instead only the workflow.
Manual Content Factories
Manual content factories, or manual approaches in general, were common before the advent of artificial intelligence tools for master data rationalization. The manual approach cannot scale nor can it meet the throughput demands of large projects.
Proper Master Data Management requires a consistent automated process!
• How repeatable is the process?• Can the system learn?• What is the throughput of the system?• How strong are the algorithms used for the automated processing?• Can the process be integrated into daily operations?
Limited Scope of Organizational Data
Narrow Focus Lack of Scalability High manual intervention Multiparty data manipulation
Key Issues with Concurrent MDM Approaches
Integrating Master Data Rationalization Into ERP Consolidation or Upgrade Planning
Master Data Management (MDM) of the Key Masters has to be part of the ERP blueprint
ERP initiatives, the importance of data migration & the emergence of Master Data Management (MDM)
During Data Migration, multiple masters are migrated•Small Masters - Chart of Accounts Master, Currency Master, etc•Key Masters - Material, Vendor, Customer, etc
Handling of the key masters during migrations is the key to unlocking the ROI from an ERP investment•Material Master ROI•Supplier Master ROI•Customer Master ROI
Handling Key Masters need a specialist•IT services provider or ERP implementation partners cannot do it•Data migration of Key masters needs strong domain expertise•Specialized cleaning tools and knowledge repositories are needed
83% of data migration projects fall/overrun• Half exceed
timescales by three-quarters
• Budgets are exceeded by two-thirds
• A third of these fail entirely
Standish group Study - 2008
Master Data Rationalization
Demonstrable ROI in• Greater and quicker ROI realization form ERP Investments
• Increased Leverage of the existing systems
• Increased Contract Compliance
• Spend Leverage through supplier consolidation
• Global Inventory optimization
• Reduction of Inventory Carrying costs
• Increased Plant Uptime
• Increased Worker productivity
• Reduced Mean Time to Delivery of Products
Extraction and Aggregation Cleansing Classificatio
n
Attribute Extraction and
Enrichment
Final Duplicate Record
Identification
Building the right business Case for
Master Data Rationalization
The bottom line
• Clean, Reliable Master Data Enables Successful Enterprise Initiatives
• Master Data Rationalization Is Required to Ensure Master Data QualityOptimized
Managed
Proactive
Reactive
Aware
• Build Master Data Rationalization Into ERP
Consolidation Planning
• Master Data Rationalization Is a Key
Component to Achieve Data Quality
Maturity
Siemens Water TechnologiesMaster Data Management & ERP Harmonization Initiative
Jeffrey KarsonProject Manager, Business IntegrationSiemens Water Technologies Corp.
About Siemens Water Technology
Siemens Water Technologies
is a leading global provider of
cost effective and reliable
water treatment systems and
services, offering everything
from emergency water supply
and conventional water
treatment processes to
wastewater reuse systems,
membrane bioreactors, UV
disinfection systems and RO
cleaning contracts. The
company's products and
services are designed to help
keep your city safe, or your
company profitable.
Siemens Water
Technologies
Leading water & wastewater
treatment company in the
world
Provides comprehensive
water treatment solutions
Has presence in the
Americas, Europe, Middle East, Africa, &
Asia-Pacific
Company has over 200,000 installations; 174 office &
plant locations
Has developed more than 850 products and technologies
The SWT Legacy- The Need For MDM
Key Events
• Siemens acquisition of US Filter in 2004
• US Filter’ history of a lengthy series of mergers, acquisitions, and divestitures
Understand the Problem:
• Fragmented business system landscape
• No master data or process standardization
• Virtually no information transparency
SWT's strategic goals
• Partner/align with SAP implementation
• Improve visibility and control of information
• Improve operational efficiency
• Improve working capital management and business process management
• Comply with SIEMENS standards
Identify common
nomenclature for master data
Enrich master data to populate
missing attributes
Consolidated &
Cleansed Master Data
Identify and remove duplicates
The Challenges
Master Data •Non-uniform data due to multiple legacy systems•Huge volumes of historical data
Legacy Systems •Data from multiple source systems•Transition from JD Edwards and Baan ERP platforms to SAP
Governance Process•No governance process to maintain Master Data •Inefficient search process•Lack of visibility across all locations
SWT’ Master data harmonization requirements
LEGACY SYSTEMS• 8 brands in the U.S• 13 instances• 3 instances that consolidate businesses
MATERIALS• 1,300,000 active materials• No common nomenclature for part descriptions or attribute callouts• Duplicates within and across legacy systems• No common or SIEMENS-required classification
BUSINESS PARTNERS• 102K customers; 63K suppliers• No common protocol; duplicates across legacy systems• No global visibility into business partner relationships• Little industry classification
The MDM initiative at SWT
• Planning• Stakeholders• Budgets• Timelines
Design the Process & Roadmap:
•Harmonize primary legacy ERP master data
•Governance for new data creation, change & data life-cycle
management
•Migrate legacy data to SAP
•Comply with corporate global applicationsThe MDM Blueprint
Verdantis Harmonize for Historical Data Cleansing & Enrichment
Verdantis Integrity Solution to manage master data creation and maintenance going forward
Business vs. Technical Effort- Finding the balance
Role of the Project Team –Design, Engage, Lead & Support
• Champion & Vision• Roadmap & Budget• Sell & Garner Support• Communicate & Demonstrate• Manage & Support Business Effort
Business people -Design, Definition & Acceptance Testing
• Harmonization & Solution Design/Acceptance • Knowledge of the business & requirements• Owners and experts of the data• Have the most at stake• More likely to drive & sponsor deployment,
troubleshooting and continuous improvement
Other Support• Executive & Business Leadership –Approval &
Support for Business Resources• IT –Legacy Interfaces, Data Rationalization, Data
Migration
ExecutiveSponsorship
MD ProjectCore Team
BusinessTechnical
Engineering
IT
BusinessFunctional
ProcessOwners
BusinessLeadership
SAP Team
BusinessTechnical – Purchasing
Centralized Core TeamDecentralized Resources & Support
The Stakeholders
Legacy Interface
RationalizeActive Item
List
ClassifyItems
Complete Spec
Attribute
Eliminate Dupes & Assign Unique Number
LegacyMaster Data
CentralMaster DataRepository
BC Owner toValidate
Inactive list
Business toProvide detailsNecessary to
Classify & enrichitems
Business to Update legacy
Data as appropriate
IT/Project Team/Technology tools Consultant/Project Team/Business Technical Support
Data Setup & RationalizationEstablish connectivityCreate Rules for InactivityEstablish Metrics for HarmonizationDeliver Data to Harmonizer consultant
HarmonizationEstablish Numbering SchemeSelect Classification CriteriaCreate Standard Attribute RequirementsTransform Data
Harmonization Process and Team Roles
Daily Report ofNewly created
records
Review forquality andedit record
In MDM
Non-compliantRecord list
sent To
businesses
AccumulateKPIs forMonthlyreport
Tools/Master Data Repository (MDR) MDDM Team Feedback : Local Business
Businessedit records
ExtractMaster
Records
Review forquality andedit record
In MDM
Non-compliantRecord
list sent to businesses
AccumulateKPIs forMonthlyreport
ERP Databases Audit: Software tools Feedback : Local Business
Businessedit
records
Daily : Review & edit new records created in the Master Data Repositories
MDM
MDR
Legacy
MDM
Monthly : Audit the ERP Databases
SAPCheck record number type (system or assigned)Check for classificationCheck for other
Non SAPCheck for Master Control NumberCheck for classificationCheck for other
The Governance Process
SAPORACLE
Search Define Authorize Create Update
SystemsLegacy User
Oracle User
SAP User
Tools/MasterData
Repository
Record:Definition
Classification
Local Authorizer
Record:Definition
ClassificationControl No.
PotentialMatch?
Approve?
Auto-Approve?
Approve?
MDMMasterData
Repository
SYSLegacy (s)
NO
YES
YES
NO
NO
NO
YES
YES
Data Governance -The MDM Lifeline
SAP
ORACLE
Benefits of master data harmonization and governance initiatives at SWT
BUSINESS• Process standardization
drives continuous improvement
• Provides consistent and actionable information
• Enables elimination of duplicated data entry across applications
• Cleansed & enrichedMaster Data for effective sourcing
• Greater savings on total Spend for different Indirect Commodities
Enriched Master Data
• Enhanced visibility across the enterprise
• Effective Data Governance
Single Version of Truth• De-duplication of data at
source• Automated attribute
enrichment at data creation point
Effective Governance Process
FINANCIAL• Improves spend
and supply management
• Enables part standardization and lean inventory
TECHNICAL• Improves success of
SAP implementation• Facilitates interfaces
between and among applications
• Enables centralized maintenance and change management
Measuring Results and Performance
Harmonization
• Data count after rationalization• Classification Success• Number of Classification
Specifications• Enrichment rate• Source active data count
Governance
• Duplicates avoided• Non-compliant records in ERP
systems• Non-compliant transformation
turnaround• Data quality
Migration
• Legacy data match up with basic views from Master Data Repositories
Corporate Applications
• Alignment of data common to multiple application
• Eliminate duplicate creation & effort –feed from the most logical source
• Quality of data feed• Quantity of rejected records
Driving People, Process & Cost Efficiency
End-Users:• An easy-to-use bolt-on-SAP solution for ongoing MDM• Greater end-user productivity and adoption of data governance frameworks• Standardization of data by eliminating the perception difference between people and plants
Business Process• Greater visibility into and optimum utilization of enterprise assets • Enhanced overall procurement process and end-user efficiency• Elimination of duplicated data entry across applications and factories• Business process standardization drives continuous improvement
Financial:• Improved spend and supply management• Greater savings by empowering procurement with greater bargaining power • Enabled part standardization and inventory optimization driving reduced
inventory cost
Ensuring Value is Added!
Why we chose Verdantis?
• Only provider that had a complete solution engineered specifically for what SWT needed
• The Verdantis Harmonize Solution to harmonize existing data and bolt on the Verdantis Integrity
Solution to control new information flowing into SAP
• A detailed Proof of Concept to harmonize a subset of SWT's real material master data was a big
success.
• Verdantis parent company, Zycus already had a relationship with Siemens' Energy business in the
related area of Spend Analysis
• Expertise in the process of mapping Siemens' proprietary ESN materials coding system to the global
standard UNSPSC coding system
• The language agnostic nature of Verdantis artificial intelligence based automated MDM solution and
the ability to handle large volume of cryptic and complex descriptions in a short turn-around time
• The Easy-to-Use and Easy-to-Configure Verdantis Integrity Solution for maintaining data integrity and
providing ongoing data management.
PRODUCTHARMONIZE
PRODUCT INTEGRITY (PIM)
Quality Master Data to Improve yourBusiness Performance
MATERIAL HARMONIZE
MATERIAL INTEGRITY (MI)
CUSTOMERHARMONIZE
CUSTOMER INTEGRITY (CIM)
SUPPLIERHARMONIZE
SUPPLIER INTEGRITY (SIM)
CLEAN IT WITH HARMONIZE
KEEP IT CLEAN WITH INTEGRITY
Get your copy of the Siemens ERP Harmonization case study here.
Master Data Solutions
www.verdantis.com
Toll Free +1 866 987 4463
Get access to many more research papers and case studies in our Knowledge hub!
Quality Master Data for Improved Business Performance
Q & A