Your business consists of processes that require correct and reliable master data. Usually, master data is distributed across several IT systems, which can lead to duplicate and inconsistent entries of business partners, product, and financial master data. What benefits would you gain if the business processes could work with accurate and reliable data?
Watch the following video to understand the importance of Master Data Governance for an organization.
Master data issues can occur across different business areas. Typically, companies prioritize their action areas (certain master data domains) according to their business impact. Often, multiple domains are in scope and a cross-domain Master Data Management (MDM) solution is beneficial.
The figure below depicts the Lines of Business and roles impacted by master data quality issues.
Listed below are the key master data challenges faced by different lines of business.
| Financials | IT | Sales | Supply Chain |
|---|---|---|---|
| Inconsistent financial master data across the enterprise | High master data maintenance costs | Lack of consistent consolidated view of customer data across all channels | Lack of transparency relating to suppliers and products |
| Manual efforts to update financial master data in local financial systems | Need for multiple systems to manage master data in different domains | Customer transactions are compromised due to a limited view of the facts | High costs due to insufficient supplier selection and rationalization |
| Risk of non-compliance to IFRS, SOX, and so on | Lack of flexibility in dynamic business environments | Loss of potential for benefit realization (for instance, discounts, conditions, central contracts) | |
| Slow group close | Limited availability of up-to-date master data in my business network | ||
| Lack of transparency about changes (who, what, when, why) |
Overall, incorrect master data can have far-reaching consequences, affecting key business functions, decision-making processes, customer relationships, and profitability.
The following video describes the major structural changes, where good master data quality is a prerequisite.
The next figure Master Data Management to resolve Business Process Challenges describes the operational excellence.
Operational excellence across the Line of Businesses (LoB) is always fueled by consistent master data helping to avoid process disruptions and non-reliable analytics.
- Optimized Asset Utilization
- Ability to use technical assets to capacity
- High product quality due to well-maintained production systems
- Minimized safety risks for maintenance staff and operators
- Readiness for Change
- Readiness to cope with information needs from the Internet of Things (IoT) and Big Data
- Ability to exchange trusted master data with business partners
- Ability to respond to mobile needs
- Cloud readiness
- Finance Effectiveness
- On-time group closes
- Accurate IT resource planning
- Business flexibility
- Procurement Decisions
- Transparent picture of suppliers and products
- Cost savings due to fact-based supplier selection and rationalization
- Supply Chain Efficiency
- Enabled real-time collaboration with partners in supply chain and product development
- Faster throughput of higher volumes through the supply chain to the end-customer
- Sales Effectiveness
- Consolidated customer view across all channels
- Transactions driven by a full picture of the facts
- Collaborative sales and promotion planning
But which SAP Master Data Governance solution to choose?
The table below lists the various installation/deployment options for SAP Master Data Management solutions.
| Private Cloud | On-premise | Public Cloud |
|---|---|---|
| SAP S/4HANA Cloud Private Edition, master data governance | SAP Master Data Governance on SAP S/4HANA | SAP Master Data Governance, cloud edition |
| Note: Functional scope is identical | SAP S/4HANA Cloud Public Edition, master data governance | |