Bringing Clarity to Your Company with SAP NetWeaver MDM

Hartmut Schaper Senior Vice President SAP NetWeaver MDM

Sometimes, all a business needs to succeed is the truth — meaning that companies must have true and accurate data in their internal systems in order to prosper. However, many companies are struggling with the opposite situation: Redundant and misaligned master data all across their system landscape. For example, the same customer or supplier data is represented inconsistently in multiple systems. Often, this redundant information is conflicting, especially if no governance and corporate standards are applied.

One might judge this as a pure IT problem. However, this situation leads to real business problems: Wrong business decisions are taken because of incorrect reporting — for example, if you are unable to see a particular customer's orders across all systems. Customer satisfaction and therefore revenue is negatively affected if you are unable to respond to customer inquiries in a reasonable way.

Take a look at your company's systems and determine how accurate your master data really is. Ask yourself: In your company, how many different databases, applications, and spreadsheets exist that hold information about your customers, your suppliers, and even your own products? How costly and time consuming is the creation and maintenance process? And most importantly, how trusted is the information behind these data assets?

If your own data is giving you multiple versions of the truth, imagine what that's telling partners in your business networks. Clarity into your own data becomes even more important as you seek to expand the reach of your business by networking with other companies.

To help companies find the truth is the role of master data management (MDM). SAP NetWeaver Master Data Management (SAP NetWeaver MDM) is enabling one version of the truth within your company, and it is a necessary foundation for enterprise services and business process management in any value network — providing a single version of the truth for customer, product, employee, supplier, or user-defined data objects.

Benefits of Moving to SAP NetWeaver MDM

SAP NetWeaver MDM enables you to consolidate, synchronize, distribute, centrally manage, and publish any type of master data object across your enterprise and with trading partners. By providing a central view of all strategic data, it helps you improve business processes and lays the foundation for enterprise service-oriented architecture (enterprise SOA).

SAP NetWeaver MDM goes directly to your bottom line and to improving top-line results. With it, you can consolidate your supplier base to understand how much you're spending and negotiate a higher discount. You can consolidate data about your products to enable up-selling and cross-selling. You can also consolidate customer data, because you can almost guarantee that your customers have consolidated their data about you.

Not only will SAP NetWeaver MDM translate immediately into savings and opportunity for revenue growth but it will also serve as a foundation for the future. As you expand your business networks and your forays into globalization, SAP NetWeaver MDM is there to enable this strategy and, over time, make it much more efficient.

More importantly, it enables change to happen quickly. In the past, relationships between business partners tended to be static over a long period of time. Today, these relationships have become more fluid and less stable. In prior days, one could work with partners to build custom interfaces to exchange data. Today, the speed of change creates additional complexity, and much of that burden falls on IT.

In this regard, however, IT has not necessarily been an enabler of change so far. Going forward, enterprise services will be the backbone to truly enable flexible value networks, and synchronized master data must be the foundation for these enterprise services.

Currently, businesses work around the lack of reliable data in a variety of ways — but often no common language and solution exists for MDM. Without synchronized master data, a company is unable to exchange valuable data quickly and consistently. Without reliable master data, when it comes to transactions with partners, all you know at the end of the day is that someone bought something for some price.

Importance of Data Synchronization Growing

SAP NetWeaver MDM is for everyone. Some industries, like retail or consumer-packaged goods, have known the value of master data for a long time. But what was once a requirement of a few specialized industries is now mandatory for all. This requirement is becoming more pressing with the rising need to ensure compliance in a dynamic environment where mergers and acquisitions and all kinds of dynamic partnering have increasingly become a normal way of doing business.

Look at the volumes of data any company produces today. If not consolidated and harmonized, this data will become unmanageable (if it isn't already). SAP NetWeaver MDM enables you to not only get your house in order, data-wise, but also put that data to better use by allowing you to share it within your own company and with your trading partners.

If you don't synchronize the data involving all your suppliers, how can you do a proper global spend analysis? And without global spend analysis, how can you do any meaningful supplier consolidation? The same questions apply to data about your customers and products. If this data is not centrally managed, marketing campaigns as well as customer analytics will be less effective; therefore, you cannot run your business in a closed loop of insight, decisions, and operations.

Many customers have told me about how they already have "master data solutions." When I ask, often it turns out that they actually have a different master data solution for different parts of the business, and few if at all are synchronized.

The idea behind SAP NetWeaver MDM is that it offers a centralized solution flexible enough to replace all other master data systems, and combines it with powerful technology, advanced search, and matching for large data volumes. SAP NetWeaver MDM comes as a pre-packaged solution that interoperates with most major applications, databases, and operating systems.

SAP NetWeaver MDM Server has two souls operating simultaneously, combining the business intelligence with the operational aspects of your business. Also, it integrates with not only SAP systems, but also has strong integration capabilities to non-SAP systems, providing you not only one version of the truth, but one that spans the expanse of your business around the globe.

The Road to Clarity

Every company needs a master data solution, but implementing it not only can test technical expertise, but also corporate institutionalism of business processes and internal politics. Before you implement this solution, you need to determine who is responsible for what data. "Responsible," in this case, really means who owns that data, and this explanation can lead to very interesting internal discussions.

Implementing an MDM solution with SAP NetWeaver MDM forces you to reach some clarity about who is ultimately responsible for major data in an enterprise. Achieving that clarity all at once can be akin to boiling the ocean, though, so you might need to start your master data project small, to go after low-hanging fruit that will immediately produce benefits and then build on this success to enlarge the solution scope.

This is a journey that takes time, for it speaks directly to the heart and soul of what makes an enterprise successful. Your enterprise may have to change the way business has been run for many years. That kind of transformation needs backing by the business and at the top echelon of your company.

Implementing SAP NetWeaver MDM can be a driver of business process transformation, to prepare your company for the future. Not all companies are well prepared for this task, but fortunately, help is available.

Outlook

With SAP NetWeaver MDM, SAP is not in this alone. We work very closely with our implementation partners, some of whom have already built significant practices on MDM and on SAP NetWeaver MDM in particular. We also work closely with partners who provide tools and methodologies to ensure data quality.

At the same time, SAP is increasing its investment into SAP NetWeaver MDM. The acquisition of Business Objects has expanded the already considerable analytical MDM capabilities of the system further. We are currently at work on version 7.1, which will contain significant meta-model enhancements and more complex data structures, along with integration of Business Objects capabilities (like their data quality offerings) with SAP NetWeaver MDM. In addition, expect to see enhancements to parallel processing, high-end performance, and smooth operation — standalone or integrated with your other SAP NetWeaver components.