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Cloud computing will play key role in the future of MDM, says Gartner

Cloud computing technology and social networks will play important roles in master data management as MDM strategies progress, according to IT research firm Gartner Inc.

Social networks and cloud computing technology will play important roles in the future of master data management (MDM), according to Stamford, Conn.-based IT research firm Gartner Inc.

But don't go dumping your enterprise master data into the public cloud just yet.

The majority of organizations today are highly skeptical about the prospect of housing valuable master data about customers, products and suppliers in the public cloud -- and that prevailing attitude is unlikely to change anytime soon, said John Radcliffe, a research vice president with Gartner's information management team.

Instead, Radcliffe said at the Gartner MDM Summit in Los Angeles last week, relationships between MDM and the cloud will blossom in various other -- somewhat less intuitive -- ways.

For starters, Gartner predicts that in-house MDM technologies will increasingly be integrated with cloud-based applications, and companies will begin warming up to the idea of using cloud-based MDM offerings for highly specific -- perhaps department-level or tactical -- MDM initiatives. At the same time, Radcliffe said, cloud-based data quality offerings will grow in popularity and increasingly help organizations achieve their MDM goals.

"We can see potentially quite a lucrative future for [some] cloud-based MDM services," Radcliffe said. "It's small at the moment, but potentially by 2015 maybe 10% of MDM will be in the cloud."

Cloud computing has exploded in popularity in recent years as companies seek to offload the cost and laborious tasks associated with running IT services on-premises. Gartner defines cloud computing as "a style of computing in which scalable and elastic IT-enabled capabilities are delivered as a service to external customers using Internet technologies."

MDM is a methodology that combines technology with data governance in an effort to synchronize data and reduce errors across business units. MDM-related technologies are typically run within the confines of the user organization's firewall, as opposed to a hosted, cloud or Software as a Service (SaaS) environment.

“Very few MDM technology and service providers have [developed] specific MDM SaaS or [Platform as a Service] products that are scalable, elastic and multitenant,” Radcliffe said. “But when they do, we expect them to exploit the cloud computing value proposition."

Despite what the future may hold, however, most technology professionals, like conference attendee Isabelle Davis, have yet to make any significant connections between MDM and the cloud.

Davis, the senior project manager for MDM at Watts Water Technologies Inc. in North Andover, Mass., echoed the security concerns of organizations that are reluctant to place sensitive information -- especially master data -- in a public cloud.

"People are concerned about it," Davis said. "Companies have barely embraced the cloud in itself, meaning that your data or your software is off-site, and you don't necessarily have control over it. What happens if it goes down? [Master data] is your core data. How secure is that going to be sitting in somebody else's architecture?"

Social networks will complement MDM strategies

The connection between MDM and the likes of Twitter may seem less than clear at first glance. But further investigation reveals potential for a winning combination between MDM and social networks, according to Gartner.

Social networks like Twitter and Facebook contain a treasure trove of valuable information related to how customers feel about products, brands and companies with whom they do business. If "Johnny123" tweets a negative review about a particular company's flagship product, it would be useful for that company to know who Johnny123 really is and whether it can remedy the situation. That's where MDM comes in.

It's highly unlikely that on-premises MDM systems will ever be used to actively scan social networks to get a handle on customer sentiment. It simply isn't feasible due to cost and technical limitations, and a whole class of sentiment analytics products exists for that very purpose, according to Radcliffe. But an MDM system could be used to help determine the true identity of Johnny123 and whether he is a valuable customer. That linkage between the master customer data and the social network could then lead to ideas about how to change Johnny123's mind and retain his business.

MDM systems typically manage lists of customer master data attributes. Gartner predicts that 15% of organizations will begin adding social media information to those lists by 2015.

"What you can think about in terms of MDM and social data is how that world of social data [links] through to the master data -- particularly the customer data," Radcliffe explained. "People will be concentrating on building that out over the next few years and complementing their social CRM strategy with this idea of MDM of customer data and supplier data."

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