The concept of organizations managing master data is nothing new. More and more companies are making it a priority to manage data to increase efficiency and reduce costs. Luckily there are technologies that exist to create Master Data Management solutions and to support a Center of Excellence for Data Governance, where data stewards and analysts evaluate and discern rules to define their master data.
In order to maximize the benefits of data governance, one must require more than just technology. Successful data governance also requires a foolproof process and expertise to get the job done. The challenge today is not whether companies can create data governance solutions but, rather, if these solutions can address the rapid changes in business. Data governance solutions are expected to help raise the value of business data. They should help an organization create, deliver and maintain accurate data. If there is no time component in this, then how valuable is that data once it’s become out of date?
If we look at the tools today that are designed to support data governance solutions, it’s clear that they are only one of a three-part solution. Data governance requires technology to automate and expedite data management, but it also depends on a solid methodology in how data is to be transformed as well as business expertise to accelerate the entire process in any one industry or domain. If these parts aren’t in sync, the rate of change in business will fast exceed the ability of these individual parts to keep up.
A good definition of the combination of these three parts is a Data Stewardship Platform (DSP) — a next-generation solution designed specifically to incorporate technology, process and expertise. A DSP helps reduce the amount of time to achieve master data quality and effectiveness and, ultimately, produce business-ready data. There are several major benefits in the use of a DSP that can help companies improve the value of their data.
1. Get the information you need faster
Making sure the data governance process is expedient is critical. By optimizing the process you can get accurate information available at a quicker pace for the business. The faster and more compressed this cycle becomes, the better the utilization of data governance precepts and business outcomes will be. Getting data updated fast enough, accessing data when necessary, having the time and trained resources to address data quality issues and being competent enough to know what process to take to remediate and maintain master data quality can be achieved in a DSP environment.
In today’s solutions, often the data update activity, typically handled by data stewards, is separate from the business activity it represents. A good example of this is when the master data process flow requires a hand-off of the data change request (from a user out in the field) to the data steward. However, the data change is typically defined in terms familiar to the user but not the data steward. This puts the data steward in an awkward position to have to make some sort of judgment call on how to categorize or process the change, putting that data immediately at risk of error.
A worst-case scenario would be if that data error caused an equipment failure or put someone’s safety at risk in the field. This becomes not just a costly business error but also a major HR and compliance issue for the business.
BackOffice Associates’ Data Stewardship Platform provides combined support for data quality, data migration and data governance.
2. The business can be more adaptive
The ability to be flexible and adapt with changes in business conditions such as mergers/acquisitions, the need to migrate to a new system (ERP, CRM, etc.) from multiple legacy systems, the move to a real-time data platform such as SAP HANA, or as broad as efficiently improving the customer experience or getting a product to market are all critical aspects of adaptive business. Each one of these conditions depends on data, including how it is used as well as how it is entered and maintained in business systems.
In order to have accurate data from all segments of the business, a data governance solution needs to be in place and be effective. But getting there requires some preliminary work, as follows:
- In the case of mergers and acquisitions there is a huge amount of work in merging non-standard systems, data and process.
- When updating or moving to a new business system, a full-scale data migration is necessary — not just porting data, but identifying the relevance and usability of that data and then transforming it into the down-line systems’ formats.
- If an organization wants to improve its top line, it will likely want to improve its order-to-cash cycle — which requires significant knowledge of its business data including where it is effective and where there are gaps or errors.
Individually, these can be very costly projects that can take 18 months to five years. Applying the concept of a Data Stewardship Platform, the majority of these data management activities can be streamlined through a single approach, reducing cost, effort and time.
3. Ability to measure time to value
This is where the true cost of data governance can be calculated. If the organization is applying piece parts to its data governance solution, how is time to value measured, optimized and monetized? An example of piece parts in a data governance solution would be purchasing a customer data governance solution that is not tied to financial data, or a data integration suite that has no data governance methodology built in. Instead the business has to hire a separate consulting firm to create a data governance solution using the data integration tools.
A huge advantage in a Data Stewardship Platform is the ability to see across all facets of the data governance process including time, resources, usability, adoption and applicability to the business objectives. The end result is the constant delivery of business-ready data — when the business needs it for whatever the conditions require.
It’s clear that by combining the elements of technology, expertise and process into a Data Stewardship Platform, businesses can begin to gain data governance cycle-time advantage and fast access to accurate information across their business, resulting in faster time-to-business advantage.
Rex Ahlstrom is chief strategy officer of BackOffice Associates, LLC. He oversees solution development and marketing for BackOffice. A technology-centric serial entrepreneur, he formerly served as vice president of operations at SAP following SAP’s purchase of his company, SOALogix. He has over 22 years of experience across a broad range of technology-focused industries including enterprise software, healthcare, telecommunications and aerospace & defense.