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Master data management adoption 'broad but shallow' across industries

In the Gartner MDM Summit keynote, analysts fleshed out the current state of MDM adoption and told attendees that data governance could hold the key to MDM success.

LOS ANGELES -- While adoption of master data management (MDM) technologies is broad across many industries, the...

actual number of implementations remains low, with only a handful of companies boasting full-fledged MDM initiatives, according to analysts at Gartner's MDM Summit here.

The market for MDM technologies -- which aim to create a single view of master data for use throughout an organization's operational, transactional and analytical applications -- stands at around $1 billion, according to analysts, but growth rates are slowing as the battered economy limps on. And many companies are just starting to get a handle on the concept of MDM.

As if to underline the point, when asked for a show of hands of those who were first-time attendees of the third annual event, around half obliged.

One of them was Jonathan G.R. Spaetzel, president of Canadian industrial fastener firm Spaenaur, which has been trying to get a better handle on its product data for more than a year and a half. But the term MDM hadn't even entered Spaenaur's lexicon until recently.

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"We didn't even know the words existed three months ago," Spaetzel said.

That may be a more common sentiment than most MDM vendors would like to admit. The reason? "MDM is a complicated topic," said Gartner analyst Andrew White in his keynote address to attendees Monday morning.

MDM, White and fellow analyst and speaker John Radcliffe said, spans not just multiple data domains but multiple business processes, operational and analytical, and has an impact on data throughout the organization.

"MDM is not the center of the universe," Radcliffe said, but "MDM is the center of a universe," namely that of corporate data.

But MDM is less about technology than vendors and some end users think. In fact, according to Radcliffe, implementing comprehensive data governance rules -- identifying who owns, publishes, and consumes data -- is key to a successful MDM program. Without it, it is almost impossible to track or even identify what constitutes "master" data.

"We see governance as absolutely central to MDM," Radcliffe said. "There's just data coming in from all sorts of different places."

Technology, of course, does play a role, and White and Radcliffe identified the current vendor landscape to help attendees make sense of their buying options.

Most vendors that offer MDM technologies focus on either party data -- like customers and suppliers -- or on "things" -- including product and inventory data. The reality is there are few vendors that can offer a truly multi-domain MDM product at this point, they said.

IBM, for instance, has both an MDM product for party data and an MDM product for "things," Radcliffe said. IBM, like other vendors, is trying to merge the two into a single, multi-domain product, but has yet to do so.

The MDM for party data vendors tend to have stronger data quality components, the analysts said, while vendors focused on product and inventory master data are better at integrating their technologies with business processes and workflows, like keeping track of inventory as it moves through the supply chain.

"There's a bit of a land grab [going on]," White said, as vendors struggle to make multi-domain MDM products a reality.

For end users, the reality is that "it's not going to be just one single, large MDM hub in large organizations," Radcliffe said. With the exception of small organizations, most companies are going to need multiple master data hubs, often on departmental levels. The key to successfully managing them, he said, is finding a data governance tool that spans them all.

Ultimately, how companies use master data management will determine the success or failure of such initiatives, White said.

"I cannot forecast how you will use MDM. It is a riddle, wrapped in an enigma," he said, paraphrasing Winston Churchill's take on mid-20th century Russia. The key, however, "is the organization's business strategy."

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