Companies typically share key information relating to products, customers, suppliers and charts of accounts across branches or business units, or across corporate boundaries.
While legislation, such as Sarbanes-Oxley in the United States, as well as new international accounting standards, has driven many enterprises to re-evaluate their master data management (MDM) strategy, the issues associated with MDM have impacted businesses for some time.
MDM is essential for companies needing to co-ordinate and integrate data between various enterprise software systems, says Caron Mooney, director of Microsoft Gold Certified partner, IS Partners.
She explains that in large organisations, business and operational units may have their own discreet data management processes that collect and organise data - often without consistency across systems.
"With the right MDM software, however, companies can create the services that will manage their master data in a way that is specific to their business model. This will ensure the accuracy and consistency of key information between business units and their individual point solutions. An inefficient process will, however, result in inconsistent data, numbers that aren't accurate and a lot of time wasted as a result," she says.
Mooney further explains that each system requires the same master data to operate, yet manages this information independently, which directly affects synchronisation and reconciliation across systems. "The effective and consistent management of enterprise-wide information is crucial. Without this, the data that drives your business intelligence or customer relationship management systems, for example, is likely to be inaccurate, inconsistent and incomplete," she adds.
A successful MDM initiative, however, relies on the implementation of best-practices from the outset and should be undertaken with the business' objectives in mind.
"Companies cannot overlook the significance of MDM for information consistency, process controls and security for regulatory compliance. While a single master data repository will ensure increased accuracy and faster results, it also circumvents the time-consuming and inaccurate manual matching practices still undertaken by many organisations today," Mooney concludes.
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