Information Technology managers are facing a dilemma given the current economic
climate. Despite budget cuts, companies do not expect reductions in the service
levels provided by IT to the business. Under such circumstances, how do you
maintain or improve service levels and continue to run the business efficiently?
Smart IT decision-makers are seeking out technology investments that can help
to accelerate cost reductions and at the same time streamline business processes.
Master data management (MDM) is exactly this kind of investment. MDM ensures
that critical enterprise data is validated as correct, consistent and complete
when it is circulated for consumption by internal or external business processes,
applications or users. A recent Gartner report on 2009 Enterprise Software Spending
mentions that "the business cases for many application and infrastructure
initiatives are now aligning to cost reduction and risk management," and
that MDM is key to transforming business processes to streamline them further
in current market conditions.
But not all MDM technologies can provide these cost benefits. Only an integrated,
model-driven, and flexible MDM platform with easy configurability can provide
rapid time-to-value and lower total cost of ownership. Consider the following
seven ways a flexible MDM platform can lower costs:
Seven ways to reduce IT costs
1.) Reduce interface costs
One definite way to reduce IT costs is to reduce the number of point-to-point
integrations across applications. Business processes such as order-to-cash that
cut across several heterogeneous applications, including order management and
accounts receivable, require complex point-to-point integration between the
individual applications. Multiply that by the number of business processes handled
by all business applications and what you have is a highly complex web of integrations
across the enterprise.
These point-to-point integrations are expensive to develop and maintain, but
MDM can simplify them by centralizing common information (master data), and
making this reliable information available at the different points within business
processes. Reducing interface costs has been proven in repeated implementations.
A global investment banking company that embraced MDM to eliminate trade failures
caused by counterparty inconsistencies was able to save millions of dollars
by eliminating interface maintenance and support. But it's important to select
an MDM platform that supports a non-invasive approach to integration. Business
applications that provide data to the MDM platform should not have to be modified
to store the identifier of the reconciled master record created by the MDM platform.
This will enable rapid integration and time-to-value.