Data-Management Danger: Less Than Half of MDM Plans Are Effective

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You probably don't think "data governance" is that important a topic. Especially when you've got IT budgetary fires raging or you're planning next week's layoffs.

You may even think today's data management and master data management (MDM) and similar enterprisewide data governance initiatives are too complex. And crazy boring. That's OK. You're not totally wrong.

But boring can be bountiful—as in saving corporate cash and increasing revenues.

That's according to the results from a brand-new survey of 123 business and IT leaders at companies with annual revenues of $500 million or more.

First, the bad news: The survey found that data-management efforts in large companies remain "significantly ineffective," with less than half of all respondents (47 percent) rating their organization’s data-management efforts as "effective or very effective." IDG Research Services conducted the survey, which was sponsored by vendor Kalido. (Full disclosure: CIO.com is owned by IDG, which also owns IDG Research. And Kalido is a data-management vendor, so take the results with that in mind.)

So while many companies acknowledge their data problems and resultant poor decision-making processes, less than one-third of businesses have taken steps to remedy the situation with a data-governance program, according to the results. Thirteen percent of respondents said they were unclear as to what data governance was.

The survey results also show a lack of consensus as to which department should be responsible for maintaining the accuracy of enterprise data: 31 percent of respondents said the role is held by the IT department, followed by a cross-functional team (25 percent), finance (10 percent), manufacturing (6 percent), sales (6 percent) and marketing (3 percent). In 10 percent of organizations, nobody is in charge. (That's bad.)

I've covered data management in enterprise apps (ERP, CRM, BI and supply chain) for several years, and these recent results are wholly unsurprising.

But according to the survey data, there's a way to save money and increase revenues with data-management policies. Those business and IT leaders who have estimated the value of accurate data, reported an average of $38 million in cost savings or revenue increase from current or planned initiatives that require accurate and trusted data.

Furthermore, 77 percent of respondents expect savings to occur on an annual basis, while 45 percent expect an annual increase in revenue. Those business initiatives that respondents' cited include: regulatory/statutory reporting (63 percent), cost-reduction activities (45 percent) and cross-sell/up-sell campaigns (31 percent).

If you could save a couple million right now, how much of a corporate hero would you be?


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