In its latest research The Information Difference found that the master data management (MDM) market grew by 31 per cent over the past year.

This is much more than a rebound from the depressed conditions of 2009, and reflects my own experiences in the market in the last year or so.

I have been getting enquiries from relatively conservative companies about how to go about starting MDM, while also seeing a number of companies bite the bullet and convert their initial pilot projects into broader enterprise deployments.

A number of factors are at play here.

There has been a realisation that despite all the investments in ERP, most enterprises struggle to answer basic questions about how profitable their customers, products and channels are, and the level of risk exposure they have to suppliers or counter-parties in trading.

Core to this problem is the diversity of competing master data around customer, supplier and product: a typical large enterprise has nine competing sources of product data and six of customer data, and many firms are in even worse shape.

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In order to get to the heart of the master data problem it is critical to get the business to reclaim ownership of its data assets and to stop delegating this responsibility to the IT function, which does not have the authority (or possibly the knowledge) to sort it out.

This reclaiming of ownership has resulted in a dramatic rise in the level of interest in data governance, with joint business and IT data governance groups assigning responsible business individuals to decide which version of critical shared data is actually the ‘master’, and hammering out the processes and authorities required to get something done about it.

Data governance, crucially, includes data quality within its scope. This is vital because poor data quality is another key barrier to effective business insight: just having a consistent set of data definitions is of limited use if the actual data is wrong, incomplete and out of date.

Once data governance processes have been put in place then the foundation for a successful MDM project is laid. Next it is crucial to properly document the state of key master data around the enterprise: what are the source systems that currently generate this data, which ones are in fact the most trustworthy, and what is the state of data quality in these respective systems?

It is important when setting the scope of an MDM initiative not to bite off more than you can chew, so pick off a few critical areas of shared data: maybe customer or product, perhaps supplier of location or asset.