How do you perform successful digitally? It’s a little bit like school. With practice and diligence everything works much better. Translated into the question of how to properly manage and diligently analyse the flood of data today, many companies think that their enterprise resource planning system, or ERP for short, serves as a cure for everything.
But that’s only partially true. The purchasing manager of a construction company, for example, who is responsible for purchasing and procurement processes and supplier management in day-to-day business, rightly works with the ERP system as the central data solution for their transactional data activities.
The situation is similar to the quality assurance manager. But in work areas such as marketing or sales, other data are at the centre of interest. Customer data. The software market also offers a technical solution for this data, Customer Relationship Management (CRM). But wouldn’t it be much more interesting to be able to collect all the data at one point and also be able to relate to each other?
ERP, BIM, PIM, or CRM as the only source of truth
In professional circles, there’s a name for it. This place is called something kind of lofty, the »Single Source of Truth«. But it’s not so much about questions of beliefs, but about a data storage principle that makes it possible to always be able to obtain specific information from one place.
Let’s take a look at one of humanity’s oldest industries: construction. This industry is particularly affected by digital transformation. The system landscape is expanding more and more and is, therefore, becoming more complex. How do you keep a good overview?
Here, the approach can help the single source of truth. But which software within the system landscape under construction has the role of being the single source of truth? Is it the ERP system where the inputs and outputs are currently trackable? Or is it Building Information Modeling (BIM), which handles the entire lifecycle of a building? After all, does the product information management system (PIM) have the edge with product data, or would the customer relationship management (CRM) system not be the central location for customer data? Can you say that at all or is it all a question of interpretation?
You have to take a close look at the system landscape of each company in order to optimise it. But what if, for example, several ERP systems exist in a company? Then there’s a need for action in any case because it indicates that data management is not very consistent. Here, different ERP islands must, therefore, be reduced or even resolved, so that at least in the ERP area, only a single source of truth arises. The same applies to the single source of truth in the area of CRM or PIM.
The golden record instead of a single source of truth
But how do you succeed with cost-effectively and rapidly consolidating the mass of transactional data from different ERP systems? It’s called »a managed data integration layer,« and basically you just hire experts to help clean up and keep track of things. From different sources, a valid data record is distilled out, the so-called »Golden Record«. From then on, it will be used for further diversion without the need for huge investments in new hardware.
Everyone has to clean up. To form a golden record is one of the central steps on the way to clarity. Especially when it comes to company mergers, it is an essential task, for example, to overlap suppliers and their products. In short, to avoid data silos and to be able to meet the customer professionally.
Sounds logical and a bit easier than it actually is. The hurdle? Transactional data, customer data and product data are located in different company departments, and each has a single source of truth in each of these areas. Sounds fancy, but also has its pitfalls.
MDM as a safe source of truth
So what do you have to do to solve the multi-single source of truth problem? Where did »the single truth« go? Maybe it helps if you think about the term. Thus, instead of the oxymoron of »single sources«, it might be more likely to talk about »points of truth«, which together create a reference source.
Depending on the project and company requirements can be drawn from these points. Of course, if the introduction of a new PIM system were to begin, it would be absurd to talk about the CRM software as a single point or even source of truth in the area of product information.
And finally, it remains to be considered to introduce a new system that, as it were, sits above the individual areas and their systems and centralises all the master data of one company without abolishing the other systems. This intelligent software solution is called Multidomain Master Data Management (MDM). An MDM enables a single, enterprise-wide, clean, consistent data structure. Originally independent data is merged into information just waiting to unleash its economic power and deliver more sales and happier customers.
Always up-to-date and high-quality product information for all output channels are crucial for success in e-commerce. A prerequisite for this is the described management of multidomain master data.
With our partner StiboSystems, we translate this approach into successful business practice. Together, we help companies with product and master data management, process management, change management, and data governance to deliver value from a single trusted source, from strategy to decision making to revenue. Learn more about working with StiboSystems here.
StiboSystems is one of several renowned MDM systems providers. In addition to an overview of all relevant PIM and MDM providers in the DACH market, in our white paper »Selecting Product Management Software«, we also provide tips for decisive selection criteria and their weighting. The guide for successful product and multidomain master data management including the dotSource vendor matrix is available exclusively for retailers, manufacturers and publishers here for free download.