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Monday, November 27, 2006

Data management master class

Master Data Management, or MDM, is touted as the silver bullet for ridding companies of inconsistent and untrustworthy business data. But does its real value lie in being an enabler of SOA?

MDM isn't new by any means. So why do proponents think it will fare better than past approaches? There are several reasons. First, MDM works by establishing master data rather than by focusing on operational (transactional) data. Second, MDM is an active approach to managing the entire information lifecycle, allowing companies to define new data, monitor exceptions as the data changes and rationalise and synchronise data as it is updated.

Last, and perhaps most promising of all, is that MDM takes a services-based approach that is in line with modern service-oriented architecture (SOA) initiatives. In other words, it treats data as another enterprise service in an SOA. Some refer to it as the 'fourth layer' of an IT architecture that sits between data and the business logic and presentation layers.

Master data management has gained prominence in recent years because of a highly fragmented application landscape caused by lines of business applications optimised for specific functions or departments. Having these multiple ERP and CRM instances and home-grown IT systems creates data silos that make it difficult for a business to get a single authoritative source against which all other data is compared, or, in MDM parlance, a 'golden record'.

"The problem stems from the fact that companies don't have all their business data in one place," notes Cliff Longman, chief technology officer at data warehousing and MDM firm Kalido.

Longman ultimately blames a lack of strategic thinking about data as one of the root causes of the problem. "Companies didn't treat data as an asset," he says. "There was no holistic discipline or training for managing it like financial assets." For instance, financial accounts software supports a consolidation process for a unified chart of accounts, mapped to multiple financial systems for integrated reporting and performance management. So why aren't other types of business data treated with the same level of respect?

Clearly having a shared and flexible IT architecture that works with consistent, accurate and up-to-date master data is vital. For that reason many point to MDM as a seminal development for IT setting the goal of moving towards SOA.

The MDM approach seems to sit nicely with how SOAs are supposed to work - ie by decoupling master data from business applications. The real promise of SOA is that you don't need to know in advance which applications will be talking to each other. But with that paradigm it's critical to first agree on common data definitions.

Longman argues that one can't have SOA without having an enterprise data service. "MDM inherently creates that data service component within an enterprise SOA, actively synchronising clean and consistent data to applications as an on-demand service," he says.

- Madan Sheina , CBRonline.com


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