Master Data Management may be positioned as a “silver bullet” for the woes of poor customer master data but it doesn’t solve long-standing systemic organizational deficiencies.
Any organization embarking on any kind of Master Data Management (MDM) initiative will need to look long and hard at a number of characteristics of how data is created, described and managed that are independent of the MDM itself if they wish to get the best value from their MDM.
That highly desirable 360º view of the customer, for example, what is it exactly?
Benefits as described by vendors and industry experts are numerous, but perhaps a small handful is the most important and most achievable.
- Reducing the costs and risks of customer data ownership
- Reducing friction in transacting or engaging with the customer
- Improved customer segmentation and targeting lists
All three of these outcomes are however heavily contingent on a number of important behaviours and organizational culture shifts.
While business leaders focus on strategic objectives and how performance metrics demonstrate the business value they will also be looking at hard metrics that can be used to baseline the status quo and then reveal improvements after the implementation of a master data management governance initiative.
None of the statements of benefit outlined above is specific enough to fall in line with the leadership needs of hard numbers but they could be further refined in order to be more specific and measurable.
Real business value drivers at best will be lagging indicators such as customer retention and increased revenue but it may also prove to be challenging directly attributing these to an MDM implementation program. In itself, an MDM program implementation may also not be able to guarantee these benefits.
While the outcomes may be a little fuzzy and difficult to guarantee, the fact of the matter is that there will be improved clarity on the state of the data and the potential in terms of analytics and insights from the customer data that may not presently exist.
Clarity on customer behaviour and the potential for predicted behaviour is really only possible if you have the data and in particular, have a unified repository of complete and appropriate customer data.
A structurally and semantically consistent customer master data view can often produce welcome side benefits such as:
- Appropriate data acquisition valuation
- Reduced M&A costs
- Improved regulatory compliance (GDPR, CPA, HIPAA etc)
- Improved employee productivity (Service, Support, Collections, Sales & Marketing)
- Reduced fraud risk
- Increased customer revenue
- Optimized outbound marketing spend
- Improved billing and collections
- Improved sales and service execution
It is important to remember that any MDM tool itself will not guarantee any particular results if the program is implemented without careful consideration of the organizational context. For this, an assessment of the customer master data management maturity is an important first step in any implementation.
Targeting thoroughly practical, data-oriented benefits as part of a Customer MDM initiative will help align organizational expectations with the capabilities of any given solution. This in turn will lead to the most obvious and verifiable information-based outcomes that will inform the business and empower staff.
To ensure appropriate MDM adoption, it needs to effectively deliver on a recipe with repeatable and scalable outcomes that encourage adoption and support from all key stakeholders and data users.
We believe that with the Pretectum CMDM, a narrowly focused Customer Master Data Management platform, you can take bold first steps toward organizational change and an improved closeness to your customers. Contact us today to learn more.