1 From Big Data to Value The Power of Master Data Management 2.0 Sergio Juarez SVP Elemica EMEA & LATAM Reveal Oct 2014
2 Agenda Master Data Management Why Now? What To Do? How To Do It? What s Next?
3 Today s Topic Defini6on Master Data Management (MDM) combines Data Governance Prac6ces with SoCware Tools in an effort to help organiza6ons achieve a "single version of the truth" of informa6on across systems and business units. 3
4 Why Now?
5 Market Trends 1. MDM in the Cloud: 2. Maturing SoCware & Technology: 3. Rise On- premises of Informa6on MDM Flow: solu6ons are increasingly The integrated sales of with MDM socware- as- a- service grows at 21% applica6ons, annually 4. es6mated Acknowledgement Worldwide and we see to informa6on MDM an $ 2,8 technology of bn the volume in Importance star6ng is growing of to Data: be at deployed a 5. Source: minimum Costs the of cloud Gartner Data rate for Pollu6on: of line- of- business 59 percent annually purposes and specific 6. By Sources: business 2015, 25% Gartner ini6a6ves. of large & The global organiza6ons will have appointed Corporate Data Chief Silos: Data Approximately Officers Data Management (CDO): as Big Associa6on Data is (DAMA) changing Source: John the Radcliffe, 15-25% way organiza6ons Research of opera6ng do Vice expense business President of there almost at all both Data Gartner organiza6ons is opportunity the lifeblood are wasted due to data quality issues. Source: The Data Management and of risk every in informa6on. digital organiza6on, Associa6on but businesses are struggling to access, share, and (DAMA) analyze much Source: of Debra the data Logan, they Research already have. Vice President Through 2015, at 85% Gartner of Fortune 500 organiza6ons will be unable to exploit Big Data for compe66ve advantage. Source: Gartner 5
6 Why Do It?
7 Value Enablers Supply Chain Organiza9onal Pyramid People Demand Mgt Strategy Development Governance & Organisa6onal Development Category Planning Sourcing Supplier Mgt Supply Planning & Control Supply of Goods & Services IT Managing the Enablers DATA Sourcing & Procurement Value Genera9on V a l u e Demand Data Insight Enables Value Sourcing Creates Value esourcing Accelerates Value Policies & Processes lock in Value 1 Years 3 4 These Enablers are prerequisites for success Sourcing won t create value without Demand Data Insight. eprocurement Sustains Value 7
8 Many Value Areas of Improved Master Data Your Engineers: Our produc6vity went up with 15% due to the increased accuracy and availability of parts, while we managed to reduce down 6me with 2%! Your Customers and Suppliers: The use of industry standard classifica6ons makes us all speaking the same language which allows instant recogni6on of parts and services, eg for price quota6ons. Your Procurement: We managed to bring costs down as we improved on Demand Insight, product descrip6ons to tender with, alterna6ve products for lower costs or higher quality, and we easily iden6fy suppliers to buy from! Your Stores Manager: Our Inventory Costs went down by an average 8% as we improved stock insight, removed dead stock and duplicates. 8
9 How To Do It?
10 Common Data Issues Common DATA ISSUES Poten9al SOLUTIONS Duplicated Items Descrip6ons include Commercial Data or don t fit audience Inconsistent Naming Conven6ons Different Languages across mul6ple Regions Poor or Non Existent Part Descrip6ons Different copies of Master Data Iden6fied, verified and amended Replace with Technical Data or use bemer wording/defini6ons Standardized Automa6on Include different dic6onaries and language packs Linking (meta) data enriches and classifies available data Cleansed Data can be fed back into your ERP (SAP, Oracle etc) 10
11 How to Organize? ERP Add on Tool with connector The Data Cleansing Tool is connected to your ERP and brings the new func6onality. Onor Offline Knowledge updates With this func6onality your data goes through a process to become more: 1. Complete: Required amributes are available for all needs and users, including suppliers, engineers, foreign countries. 2. Consistent: Naming conven6ons are applied consistently. 3. Conformed: Industry standards and classifica6ons are applied correctly. 4. Accurate: Data free of typo s and misleading abbrevia6ons. 11
12 Initial Cleansing Process Product Iden9fica9on 1 2 Standardiza9on & Enrichment Language Transla9on 3 4 Duplicate Removal 1. Interpret Data; including Abbrevia6ons, Typos etc 2. Match Parameters 3. Score Outcome as to Funnel Manual Workforce to Problem Areas 1. Enrich Data with External Sources like Supplier Catalogues 2. Apply Naming Conven6ons 3. Replace Commercial Data with Technical Data 4. Classify to Deepest Category of Various Standards 5. Separate Vendors from Manufacturers 1. Recode Fields for different Target Groups like Suppliers, Engineers, Procurement 2. Transla6on into Different Languages 1. Iden6fica6on of Duplicate Parts 2. Iden6fica6on of Similar Parts eg OE vs Commodity, or Single Items vs Kits 3. Insight on Volumes for Duplicate Parts, Stock Value and Store Loca6ons 12
13 What s next?
14 Next Steps 1. Get Your your priori6es Priori6es straight Straight: 2. Scope Focus on: the Ini6a6ve: 3. Assess Short Opportunity: Term vs Long Term? 4. Select & Implement Value To Streams Which Categories And Geographical Loca6ons Are In Scope? be Experience Which Manual Languages vs shows Automated the And following Classifica6on Cleansing? metrics Standards could be To achieved: Implement? Outsourced vs in- house? As Potential is Typical Which For today Category Domain you Items Strategy can: KPI vs Shall Be Considered? Savings Savings Which All a) Supply Request Inventory cost reduction 5-15% 8% Tools Chain And a Demo Items? Processes to Elemica Are Affected? Reduce Pain Points vs Increase Value Areas? THINK BIG start small b) Procurement Amend cost the reduction Breakout Session Inside 2-10% view 5% on Master Data mgt Tooling Equipment downtime reduction 2-5% 3% Supply chain & storage cost reduction 8-12% 10% Increased procurement & engineering worker productivity 8-20% 15% Reduced Accounting Compliance Risk 2-5% 3% Time line Scale Fast 14
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