What is Master Data, and Why is the Need to Manage It Growing?

Master Data is a single and authoritative source of common data that is distributed across communities and their applications. It provides the background for transactional data about physical assets and serves as the foundation for the information necessary to run a business.

By ensuring all stakeholders are working with the same reference point, Master Data minimizes errors and costs. Created once and shared with all users, processes, and applications, Master Data has become indispensable, ensuring its relevance throughout the entire organization.

However, managing Master Data has proven to be challenging in practice, with segregated data silos, integration complexity, and obstructive organizational layers creating hurdles. This blog post will discuss what Master Data is and why its management and distribution are increasingly vital.

What is Master Data and Master Data Management?

Companies typically deal with three forms of data: transactional, analytical, and Master Data. Transactional data is generated by various applications supporting everyday business processes, analytical data is produced through calculations performed on transactional data, and Master Data represents the business-critical objects on which transactions are carried out. These objects and their associated metadata, relations, and taxonomies also include parameters used for data analysis. When Master Data is well-structured, governed, and tightly managed, it becomes easier to handle and exchange.

Therefore, Master Data Management (MDM) is crucial for organizations, helping them establish a single, accurate view of, for instance, individuals, locations, or entities within their operations. For example, when different parts of a business use varying data input methods with different standards and rules, it can be challenging to determine if multiple instances of a person’s name in the system actually refer to the same individual.

Master Data Management ensures accurate, consistent ‘golden records’ and enterprise knowledge across various entities and their software systems, emphasizing the need for a standardized set of shared Master Data across departments or organizations. Effective MDM is essential for data uniformity, completeness, and accuracy, highlighting areas needing improvement when data quality issues arise.

Why is Master Data Management Important for You?

By ensuring that Master Data is semantically consistent, Master Data Management provides a critical layer of oversight. It establishes a foundation for shared responsibility between the IT department and the broader business for maintaining accurate Master Data across the organization. Building on this foundation, Master Data Management enhances operational efficiency through four key benefits:

• Master Data is never specific to a particular application and shouldn’t be. Standard lists and basic contents in applications might ease the use of the specific application, but it has no commonality with other communities or applications. By reducing duplication and minimizing risks, it empowers organizations to enhance efficiency and gain control over how data changes are implemented.
  
  
• Put simply, the lack of Master Data Management creates redundancy in the vital information that a business needs to operate. If data is stored in multiple silos or systems across an organization, it can be difficult to create a comprehensive view. MDM reduces the risk that determining the accuracy of data will be difficult, for example, when duplicate data exists across different systems or departments.
  
  
• With a lack of data governance and no clear ownership structure for data within an organization leading to inconsistent data management practices, Master Data Management is crucial. It helps to streamline data management processes and reduce the time and effort required to manage data.
  
  
• Master Data Management improves data quality so that data is accurate, complete, and consistent across your organization. By integrating data from multiple sources and systems, it creates a single, unified view of data.

The resulting benefits include operational efficiency, better regulatory compliance, a greater degree of control over all data sets, and the ability to optimize your supply chain.

How Can Laces Help?

In the modern business landscape, Master Data is a foundational element in enabling informed decisions and streamlined operations. It is the core data that is essential for running operations within a business enterprise or unit. So, why take any chances?

The Laces Suite is an all-in-one solution that allows users to capture, share, and apply Master Data in any software. Applications such as the Laces Ontology Manager and the Laces Standards Manager enable Master Data development and management and then publication on the Laces Data Platform.

With a simplified approach to capturing and managing Master Data, domain experts can capture knowledge according to proper structures and with reference to other standards like information models and dictionaries. Using the Laces Suite, domain experts without extensive IT knowledge can manage the Master Data.

Linked Data for Master Data is managed once, can be distributed, and applied multiple times to any user and application. With Laces, instead of a data management headache, you now have an invaluable tool for increasing efficiency and maximizing profits.

Do you want to discover our solution for Master Data Management? Do you need to know why exchanging Master Data in Linked Data makes working on projects with different stakeholders much easier? Download our white paper.