We caught up with Chris Hale, VP of Global Product Marketing for Liaison Technologies, to get his take on why the cloud is making the adoption of master data management (MDM) more feasible for mid-market companies, as well as opening new opportunities for global enterprises.
We’ve been providing master data management solutions for a long time, but we’re seeing a definite surge in customer interest with our cloud-based MDM services. Not to mention, we’re also hearing that an increasing number of senior IT executives are now requiring their departments to start seriously evaluating cloud/Software-as-a-Service (SaaS) options.
But, to be sure, it’s not just our own experience we’re relying on when we say cloud MDM is putting segments of master data management within the reach of many more organizations. Recent research by Aberdeen Group also points to cloud MDM as being a catalyst for more organizations—from mid-market companies to global enterprises—to adopt master data management practices. I should mention that the majority of these companies are not implementing a “Big Bang” approach to MDM. Rather, the cloud model is offering them the agility, lower cost and faster time-to-value desired for smaller “proof of concept” projects—for example, those relating to data quality, data cleansing and parsing, and data harmonization—as a first step towards a larger MDM strategy.
Aberdeen’s 2011 survey revealed a significant uptick in cloud MDM adoption over the past year, with over one-fifth of respondents now using some elements of this model. This interest corresponds with what we’re seeing with customers across industries, because of how well it resolves some of the key drivers of poor-quality product data.
The biggest driver of poor-quality data is actually the rate at which company data is growing—which, according to Aberdeen, is 35 percent year-over-year. That growth, combined with the typical practice of holding data in separate departmental silos, makes it difficult for employees to find what they need in a timely manner, if at all. Another problem is the challenge of matching up multiple internal data formats and external data formats stemming from suppliers. Aberdeen cites this as a top pressure of 36 percent of companies.
Cloud MDM matches up well against these drivers of poor-quality data. One of its inherent benefits is that by definition, it is a central repository of information in the cloud, accessible through a portal, browser or application. This “equal opportunity” access removes the barriers caused by data silos or complex distributed organizations, and the pay-as-you-go model easily scales to handle data volume increases.
Data quality across industries is of overwhelming poor quality, making much of it useless for business operations and fact-based decision-making. Even though companies acknowledge this problem, the challenges and barriers to adopting a traditional, on-premise MDM solution are too big: high data complexity, too many data owners, and a hesitation to spend the time and money for uncertain returns. In particular, many organizations regard the technical complexities of integrating the data as insurmountable.
Cloud MDM resolves the problems inherent in traditional, on-premise master data management solutions by providing a central, scalable, readily accessible repository of accurate data—and it does it affordably. The reality is that, due to their cost and complexity, traditional on-premise MDM initiatives, particularly the “Big Bang” type, don’t easily get off the ground. In contrast, cloud services are making it feasible for organizations that desire more easily accessible and trustworthy data, or that need to establish an enterprise-wide data governance process, to begin undertaking incremental MDM initiatives at lower risk and with much greater success.
By Chris Hale
Chris Hale is the vice president of Global Product Marketing at Liaison Technologies (www.liaison.com), a global provider of secure cloud-based integration and data management services and solutions based in Atlanta. He can be reached at [email protected].
