From Big Data
to Value
The Power of Master Data Management 2.0
Sergio Juarez
SVP Elemica EMEA & LATAM Reveal Oct 2014
Why Now?
What To Do?
How To Do It?
What’s Next?
Agenda
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"
Market Trends
1. MDM in the Cloud:
“On-‐premises MDM solu6ons are increasingly
integrated with soCware-‐as-‐a-‐service applica6ons, and we see MDM technology star6ng to be deployed in the cloud for line-‐of-‐business purposes and specific business ini6a6ves.”
Source: John Radcliffe, Research Vice President at Gartner
1. MDM in the Cloud
2. Maturing SoCware & Technology:
The sales of MDM soCware grows at 21% annually es6mated to an $ 2,8 bn in 2014.
Source: Gartner 1. MDM in the Cloud
2. Maturing SoCware & Technology
3. Rise of Informa6on Flow:
Worldwide informa6on volume is growing at a minimum rate of 59 percent annually
Sources: Gartner & The Data Management Associa6on (DAMA)
1. MDM in the Cloud
2. Maturing SoCware & Technology
3. Rise of Informa6on Flow
4. Acknowledgement of the Importance of Data:
By 2015, 25% of large global organiza6ons will have appointed Chief Data Officers (CDO): as Big Data is changing the way organiza6ons do business there is both opportunity and risk in informa6on.
Source: Debra Logan, Research Vice President at Gartner
1. MDM in the Cloud
2. Maturing SoCware & Technology
3. Rise of Informa6on Flow
4. Acknowledgement of the Importance of Data
5. Costs of Data Pollu6on:
Approximately 15-‐25% of opera6ng expense of almost all organiza6ons are wasted due to data quality issues.
Source: The Data Management Associa6on (DAMA)
1. MDM in the Cloud
2. Maturing SoCware & Technology
3. Rise of Informa6on Flow
4. Acknowledgement of the Importance of Data
5. Costs of Data Pollu6on
6. Corporate Data Silos:
Data is the lifeblood of every digital organiza6on, but businesses are struggling to access, share, and analyze much of the data they already have. Through 2015,
85% of Fortune 500 organiza6ons will be unable to exploit Big Data for compe66ve advantage.
Source: Gartner
Value Enablers
Supply of Goods & Services Supplier Mgt Strategy Development Governance & Organisa6onal Development Category Planning Sourcing IT People DATA
Managing the Enablers
Supply Planning & Control Demand Mgt V a l u e € 1 3 4
Policies & Processes lock in Value
Years
Sourcing & Procurement Value Genera9on Supply Chain Organiza9onal Pyramid
Dema nd Da ta In sigh t En ab le s Va lu e
Sourcing Creates Value
eSourcing Accelerates Value
These Enablers are prerequisites for success…
Sourcing won’t create value without Demand Data Insight.
eProcurement Sustains Value
Many Value Areas of Improved Master Data
8
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 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%!”
“Our Inventory Costs went down by an average 8% as we improved
stock insight, removed dead
stock and duplicates.” 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!”
Common Data Issues
Iden6fied, verified and amended
Duplicated Items 1 Standardized Automa6on Inconsistent Naming Conven6ons 3
Include different dic6onaries and language packs
Different Languages across mul6ple Regions
4
Linking (meta) data enriches and classifies available data
Poor or Non Existent Part Descrip6ons
5
Cleansed Data can be fed back into your ERP (SAP, Oracle etc)
Different copies of Master Data
6
Common DATA ISSUES Poten9al SOLUTIONS
Replace with Technical Data or use bemer wording/defini6ons
Descrip6ons include Commercial Data or don’t fit audience
2
How to Organize?
ERP
Add on Tool with connector
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.
The Data Cleansing Tool is connected to your ERP and brings the new func6onality.
On- or Offline Knowledge
Initial Cleansing Process Product Iden9fica9on 1 2 3 4 Standardiza9on & Enrichment Language Transla9on 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 12 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
Next Steps
14
1. Get Your Priori6es Straight:
Focus on:
• Short Term vs Long Term?
• Manual vs Automated Cleansing?
• Outsourced vs in-‐house?
• Category Items vs
All Supply Chain Items? • Reduce Pain Points vs
Increase Value Areas?
Value Streams As is Time line
THINK BIG start small Scale Fast
To be 1. Get Your Priori6es Straight
2. Scope the Ini6a6ve:
• Which Categories And Geographical Loca6ons Are In Scope?
• Which Languages And Classifica6on Standards To
Implement?
• Which Domain Strategy Shall Be Considered?
• Which Tools And Processes Are Affected?
1. Get Your Priori6es Straight
2. Scope the Ini6a6ve
3. Assess Opportunity:
Experience shows the following metrics could be achieved: KPI Potential Savings Typical Savings
Inventory cost reduction 5-‐15% 8% Procurement cost reduction 2-‐10% 5% 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%
1. Get your priori6es straight
2. Scope the Ini6a6ve
3. Assess Opportunity
4. Select & Implement
For today you can:
a) Request a Demo to Elemica
b) Amend the Breakout Session ‘Inside view on
Master Data mgt Tooling’
