How master data management serves the business
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1 IBM Software White Paper Information Management How master data management serves the business Leverage a single view of the enterprise to reduce costs, increase agility and support compliance
2 2 How master data management serves the business The demands of business pull organizations in many different directions. Public sector enterprises need to provide superior service, but must do so with fewer resources. Businesses need to nimbly identify competitive advantage, but also must comply with industry standards and government regulations. Competing priorities further complicate organizations data environments. Each business unit, department and division maintains its own information. But for a forward-looking organization to be agile and effective, those information silos must be shared, distributed and synchronized. Master data management (MDM) software helps organizations resolve these tensions. It manages the creation, maintenance, delivery and use of master data; that is, the information about customers, products, materials, accounts and other entities that is critical to the operation of the business. Ultimately, MDM creates a consistent and trustworthy view of the enterprise not in the context of a single department, but from a holistic perspective. This helps the entire organization be more efficient and effective by eliminating reliance on inconsistent, incomplete or duplicate data. With more than 600 MDM customers globally, IBM is at the forefront of MDM and information-sharing technology in industries such as banking, insurance, healthcare, the public sector and more. IBM InfoSphere Master Data Management offers a complete solution, helping you unlock the value of your data assets regardless of data domains, use cases or implementation styles. InfoSphere MDM can be easily adapted to your specific business situation, and is designed to help you quickly deliver value while setting the stage for organizational growth. No matter where you are on your MDM journey, you gain the benefit of IBM s deep industry expertise and extensive software portfolio. Many MDM customers have chosen to sustain their relationships with IBM for a decade or more. In this white paper, we will look at how master data management software can serve the business by supporting strategic decision making, agility and compliance, as well as by lowering operational costs and increasing sales. And we will draw on IBM s extensive real-world experience to explore significant business use cases for MDM. The four business drivers for MDM Master data is the high-value, core information that flows through an organization s key business processes. This data, located in disparate information silos, is often inaccurate, incomplete or duplicated. A department that relies solely on its own information silos will see only one part of the bigger picture. To manage master data effectively, organizations need processes that establish and maintain consistency for these common data elements, regardless of the source system. MDM software supports this requirement by facilitating the exchange of data between disparate sources, and by reconciling isolated data views. The goal is to create what is commonly called a single golden view of customers, employees, products or accounts any entity that an organization tracks. By creating a complete view that eliminates inconsistencies, companies can derive a more accurate picture of their business anything from how much a customer bought to how much a product costs from development to delivery. The benefits from effective MDM fall into four broad categories: lower operational costs; improved agility; increased compliance and reduced risk; and increased sales.
3 IBM Software 3 Lower operational costs Using MDM software to bring together isolated data helps automate manual business processes and reduce errors. MDM can also help rationalize systems and applications after a merger or acquisition, as well as indicate when duplicate customer or product data exists in disparate systems. As a result, it helps companies eliminate redundancies such as the double mailings of statements, promotional offers or product catalogs. Improved agility By quickly consolidating customer information from different systems, companies can more easily identify sales opportunities or underserved regions, enabling them to tackle potential new markets or business channels. This also helps companies bring customers on board faster and serve them better by delivering customized offers based on client profiles and preferences. Increased compliance and reduced risk MDM can help reduce fraud. When business processes are consistent and use accurate data, crucial steps are less likely to be skipped, and more likely to adhere to government regulations, industry standards or even corporate service-level agreements. This enables prompt and accurate audit reporting. MDM software also helps ensure that companies have a complete view of where data resides, so they can always control access to it. Furthermore, with customer privacy preferences applied in a standard fashion across the enterprise, companies avoid the risk of accidentally contacting a customer inappropriately or providing data to a third party against a customer s wishes. MDM software also accommodates the consolidation of data from external sources such as credit ratings, rate feeds or watch lists. Increased sales MDM software helps resolve conflicting information from multiple data sources, helping companies create a 360-degree view of the entities they are analyzing. For example, many companies have customers who deal with multiple lines of business. Each business unit may have a slightly different address for the same customer, and none of them know that the customer has a relationship with the others. With the additional insight provided by MDM, executives of those departments see a single high-value client who qualifies for priority service, instead of several unrelated mid-tier accounts. As a result, companies can more easily identify high-value customers and opportunities for cross-selling, up-selling and targeted promotions. They can also provide a consistent experience no matter how the customer interacts with the company, which helps improve customer satisfaction and retention. IBM InfoSphere MDM: A solution that spans the enterprise The specifics of an individual MDM implementation will vary depending on the organization. As a proven, complete solution, IBM InfoSphere MDM offers the capabilities to meet a broad range of MDM needs. In the scenarios that follow, InfoSphere MDM provides the foundation for the most significant business use cases: information consolidation within a single organization; information sharing across public sector agencies; and collaborative authoring of production information between channel partners.
4 4 How master data management serves the business Scenario 1: Information consolidation Companies in such industries as banking, insurance and telecommunications often grow their business through mergers and acquisitions. Newly merged entities are left with complex IT infrastructures; that is, many duplicate applications, databases and warehouses. In response, these companies may embark on infrastructure rationalization and modernization projects to consolidate sources of customer data, product data and other master data elements. In this scenario, the organization uses InfoSphere MDM to build a physical master repository of data for customers, accounts, products or other domains. InfoSphere MDM creates what is essentially a golden record for each master data domain, a single source of authority that enables accurate analysis and decision making (see Figure 1). Billing Tech Support Gray, Janice 65 Main Street 10/1/10 Lvl 1 Resolved In-Store Sales & Marketing 5/23/11 $ Software Online Sales & Marketing jrg@example.com Customer Janice Gray 65 Main Street jrg@example.com InfoSphere MDM History 10/1/10 Support Lvl 1 Resolved 5/23/11 Purchase (In-Store) $ = Physical/Transaction Figure 1: InfoSphere MDM helps organizations consolidate their data into a physical master repository, creating a golden record for each data domain. Key To help organizations reach this goal, the InfoSphere MDM platform offers pre-built domains, encompassing data models and associated services that enable a company to get a running start on consolidation projects and deliver value sooner. The domains can be extended and tailored easily. The solution also includes flexible, comprehensive tools so that organizations can quickly build custom data domains and information-intensive business applications. The InfoSphere MDM platform combines efficiency and customization in many ways to help organizations maximize the value of their MDM projects. For example, the InfoSphere MDM SOA Business Services Library offers approximately 800 intelligent, prepackaged web services that can be used to seamlessly integrate MDM into existing business processes and technical architectures. The Library is a tremendous resource of ready-to-use components, APIs and services that deliver advanced business logic capabilities, potentially eliminating the need for costly custom application development, and helping to accelerate the project s time to value. Because it helps companies consolidate information, InfoSphere MDM can also streamline business processes. One financial services institution was able to consolidate five customer-related applications into one, saving more than USD50 million in IT-related costs. But by consolidating the applications, it also gained a more consistent view of the customer and improved data quality. Another financial institution wanted an aggregate customer view to enable new marketing strategies and increase the number of products owned per customer. This company deployed InfoSphere MDM to integrate data from eight business systems to develop a more accurate view of its customers. The project almost immediately increased the marketing effectiveness of its rewards programs and its account penetration.
5 IBM Software 5 In the hospitality industry, hotels may be owned, franchised or managed by third-party management firms so it s common for customer information to reside in a multitude of systems. One hotel used InfoSphere MDM software to integrate data from those disparate systems, allowing it to create a more accurate database of customer preferences and, subsequently, better pinpoint its best customers and their preferences. Scenario 2: Secure information sharing Not all organizations have control over all phases of customer data. For example, a single corporate entity might have distinct lines of business or geographic locations that maintain independent information systems. Other institutions may collaborate among affiliated entities or trading partners. These types of organizations need to aggregate, share or distribute relevant information, but security and privacy concerns present an ongoing challenge. Consider the healthcare industry, in which patient data is maintained by multiple, unaffiliated entities hospitals, physicians offices, clinics, laboratories and pharmacies. There is an increasing need in healthcare not only to keep costs down, but because of government regulations, to keep patient data secure. How can healthcare partners safely share and analyze patient data to improve care and optimize service delivery? Similarly, government agencies face demands from taxpayers to allow access to information in an intelligent, citizen-centric manner. For instance, someone involved in a home-remodeling project doesn t want to provide the same information first to the local planning commission and then to the permit department; those departments should be able to access each other s information seamlessly. In other words, citizens have come to expect the same level of integrated service from government agencies as they receive from top-rated service companies. Unfortunately, data is frequently locked inside applications that were developed long ago to meet the requirements of a single, defined program. This historical approach has led to a proliferation of information silos that don t share nicely. With InfoSphere MDM, organizations can create what s known as virtual registry architecture. The registry contains virtual records, essentially a linked reflection of data that resides in the original application systems. Because the registry requires no change to the underlying applications, it can be deployed quickly, and at a low cost. The registry style works well for organizations that need to maintain their source systems locally, or that cannot physically consolidate data because of security or privacy concerns (see Figure 2). Department of Motor Vehicles (DMV) Gray, Janice 65 Main Street Child Welfare and Support (CWS) 10/1/10 Case worker home visit Women and Infant Children (WIC) 5/23/11 Distribution $ Health Services 7/7/08 Referral to specialist InfoSphere MDM Customer Janice Gray 65 Main Street History 7/7/08 Health Services Referral to 10/1/10 CWS Case worker home 5/23/11 WIC $ Key = Virtual/Registry Figure 2: When organizations must share information but keep the source records separate, InfoSphere MDM can create a virtual registry architecture.
6 6 How master data management serves the business For accurate results, however, this scenario requires a highly refined search engine, one that can access the appropriate external data repositories and load, match and link master data. The InfoSphere MDM solution s master data engine performs the task effectively, and scales to accommodate almost any amount of data. This eliminates the need for time-consuming integration of data, which means that information is available sooner. InfoSphere MDM also incorporates a flexible data model that can accommodate information from any source. The ultimate result: a highly streamlined framework that assembles a single view of the data and makes it easy for end users to work with. Consider the example of a retail pharmacy with a very specific project in mind: accurately identifying pharmacy customers to improve patient safety and reduce fraud. The pharmacy can satisfy this goal quickly by implementing a patient registry. The project involves assembling a single view of patient information from individual records spread across thousands of retail stores. In subsequent phases, the pharmacy expands its MDM program to create a list of offered products and services and offer relevant services based on client profile and location. In another example, a human services agency in the western United States deployed InfoSphere MDM to create a master client index that links citizen information across 10 public sector programs. By enabling secure, private information sharing across benefits programs, InfoSphere MDM helped the agency accurately determine eligibility and improve services levels for its constituents. Similarly, a local government agency in the United Kingdom leveraged InfoSphere MDM to support targeted service delivery as well as identify and eliminate fraudulent benefit claims. Scenario 3: Collaborative authoring Product development is one of the areas where MDM is most valuable. For organizations to quickly bring new offers to market, they need to centralize the creation and maintenance of master information about products. This process, called product information management (PIM), allows employees, contractors, vendors and other supply chain participants to enter and update relevant information throughout the development process. For example, product managers might enter product descriptions and bills of materials, while advertising agencies update product images and engineers input components and packaging data. The result: a single, consistent and accurate view of product information that enables accurate decision making. The IBM InfoSphere MDM solution forms a foundation for collaboration across all parties in the product development and information distribution process. It provides a flexible data model that lets companies map hierarchies, attributes and relationships for all product components (see Figure 3). Supplier Data Name: Flat Screen TV Product ID: FT64-10 Contrast Ratio: 30,000:1 ERP Data Name: Flat Screen TV Product ID: FT-011 Marketing Data Name: Flat TV Product ID: FT70-10 Description: Black & Silver new model Print Catalog Data Name: Flat TV Product ID: FT85-43 Contrast Ratio: Unavailable InfoSphere MDM PIM Data Product ID: FT64-10 Supplier ID: BGR-1448 Short Name: Flat TV Long Name: Flat Screen TV Print Description: Flat TV Promotional Description: Black & Silver new model Contrast Ratio: 30,000:1 Key = Physical/Collaborative Figure 3: InfoSphere MDM can help organize the complex and chaotic process of product development.
7 IBM Software 7 InfoSphere MDM incorporates collaborative business processes so that employees can easily create workflows for tasks that span multiple departments; tools for authoring and search; capabilities for establishing security and access rights; and tools for data synchronization, job scheduling and version control. It enables organizations to model their own, unique business processes and enforce associated standards. Organizations that employ InfoSphere MDM collaborative authoring capabilities for PIM can realize considerable benefits: Optimized customer, partner, supplier and employee relationships Fewer product information errors, leading to improved sales and reduced losses Multichannel initiatives built upon a common, trusted source of product information Published materials created from reliable, current product information Accurate, up-to-date e-commerce initiatives Improved operational efficiency enabled by leveraging accurate product information One manufacturer consolidated product information from dozens of suppliers and then distributed it in appropriate formats for distributors, online sales and catalog sales; plus, it did so in documentation encompassing 15 different languages. Its InfoSphere MDM deployment created a single source of comprehensive product information, a flexible workflow for product translation, and a method for synchronizing price changes in real time across multiple channels. With these improvements, the manufacturer derived 30 percent higher productivity for its product launch process across regional markets. In a second example, a major garden center retailer automated the management of its electronic catalog. By providing consistent, accurate information about more than 45,000 items, the retailer makes it easy for customers to find and purchase the products they need, when they need them. Finally, a leading European bank found that collaborative authoring enables local business units to easily construct customized product bundles for its target market segments. By cutting time to market from weeks to days, the bank expects to outperform the competition and enhance customer loyalty. How IBM InfoSphere MDM serves the business A growing business demands a deeper understanding of customers, products and other key enterprise information. Through the discussion of business use cases, this paper shows how MDM helps organizations increase agility, control operational costs, improve compliance and drive new revenue. IBM InfoSphere MDM combines strong out-of-the-box data management with a deep capacity for customization and configuration, making it the ideal choice for organizations seeking to deliver a holistic, integrated view of their data. It offers a range of capabilities for information consolidation, secure information sharing and collaborative authoring, proven across over 600 customer deployments. With the support of a comprehensive platform and the strength of the IBM portfolio and experience, you can take large, confident strides on your MDM journey. The destination: improved business results, lower costs, reduced risk and increased strategic agility. IBM InfoSphere MDM can help you get there faster.
8 For more information To learn more about how IBM can help you transform your business, please contact your IBM sales representative or IBM Business Partner, or visit: ibm.com/software/data/master-datamanagement Copyright IBM Corporation 2011 IBM Corporation Software Group Route 100 Somers, NY U.S.A. Produced in the United States of America June 2011 All Rights Reserved IBM, the IBM logo, ibm.com and InfoSphere are trademarks of International Business Machines Corporation in the United States, other countries or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol ( or ), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the web at Copyright and trademark information at ibm.com/legal/copytrade.shtml Other company, product or service names may be trademarks or service marks of others. References in this publication to IBM products or services do not imply that IBM intends to make them available in all countries in which IBM operates. Offerings are subject to change, extension or withdrawal without notice. All statements regarding IBM future direction or intent are subject to change or withdrawal without notice and represent goals and objectives only. Please Recycle IMW14570-USEN-00
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