What is Master Data Management? Benefits, Use Cases, and more.
Master data management (MDM) is a process and set of tools that helps organizations manage their business-critical data assets. Keeping data accurate and up to date is the basis for business operations across industries. In this blog post, we will explore what MDM is, its benefits, and some common use cases. With a better understanding of MDM, organizations can make sure their data is well-managed and secure, which enables them to make confident decisions, keep a pulse on trends, and use resources efficiently.
What is Master Data Management (MDM)?
Master Data Management (MDM) is a powerful tool in the business intelligence world. MDM enables organizations to simplify complex enterprise data by providing centralized access to multiple data sources that can be used for reporting and analysis. It offers unified views of operational systems and disparate databases to ensure there is one version of truth across the organization. By utilizing MDM, companies can increase customer satisfaction, reduce operational costs, improve scalability, and reduce risk associated with disparate data sources. As businesses move towards a digital transformation strategy, they should consider MDM as an essential part of their business intelligence suite.
Master Data definition and benefits
Master data is a collection of consistent, accurate, and meaningful data that is essential to an organization’s operations. It is used across systems and departments to ensure efficient operation and easy access to information when business decisions need to be made. All stakeholders in the company can use this type of data when needed, which allows for improved oversight, alignment, and collaboration, resulting in better decision-making capabilities. Implementing master data results in increased customer satisfaction, reduced risk of errors or misinterpretations of information, and reduced waste and expense of managing redundant or inaccurate data.
Why bother with managing master data?
Managing master data efficiently is vital to creating a solid basis for business operations. By taking the time to organize and control master data, an organization can streamline its processes, improve decision-making capabilities, and strengthen customer relationships. Managing master data allows organizations to create one source of truth for all stakeholders to reference, creating a more unified view of customers, partners, and other essential information. Understanding and maintaining this data helps organizations comply with regulations and maximize marketing efforts by ensuring accurate target segmentation and delivering relevant offerings to customers in a timely fashion. In short, while managing master data can be a laborious process at times, it pays dividends in terms of increased efficiency, rationalized costs, and improved customer satisfaction.
What are the differences between Master Data Management tools and MDM as a discipline?
Master data management is a discipline applied to an organization’s data architecture that focuses on organizing and standardizing data and creating the mechanism for enforcement of the policies governing the organization’s data use. MDM tools are software applications used to manage, integrate, and centralize data across multiple systems. MDM tools also provide visibility and enable users to create reports based on unified datasets. While they serve similar purposes, MDM as a discipline refers to the big picture of a company’s master data governance strategy while MDM tools are used to execute this strategy.
How does master data management relate to Provider Data Management?
Master data management is a powerful tool that can be used to manage provider data in healthcare. By implementing a comprehensive and healthcare-optimized system, organizations can ensure that their core provider data is up to date and correct. Master data management also helps to streamline processes by providing valuable insights, such as reimbursement trends or population health analysis, so that the organization can focus on aligning its provider network for maximum efficiency and profitability. Through a comprehensive master data strategy, organizations have the tools needed to fill in any gaps in their provider network and optimize operations for maximum efficiency.
How does master data management relate to an enterprise master patient index (EMPI)?
When a master data management solution is deployed in healthcare organizations, a higher level of accuracy is required when matching records—so that patient data, for example, is matched only to the person it belongs to and there is no mixing or fragmenting of data that could cause unfortunate outcomes from billing and reimbursement issues to high-stakes medical errors. In healthcare settings, it is therefore imperative that an MDM solution be augmented with an enterprise master patient index (EMPI), which is software that accurately resolves identity data so that records for one patient or member that live in siloed systems can be confidently linked together. The Verato MDM platform is built specifically for healthcare and is powered by an integrated, industry-leading EMPI—so no additional systems are needed to achieve healthcare-grade matching accuracy.
What do I need to know about Master Data Management (MDM)?
Cloud vs. Legacy MDM software
The master data management landscape has drastically changed over the last few years. On one hand, legacy on-premises MDM software is often pricier and requires complex integration into existing corporate infrastructures. On the other hand, cloud-based solutions offer a less expensive and more streamlined user experience. Many companies are now turning to cloud-based solutions to manage master data, which provide cost savings, scalability, better security, reliability, and quick implementation compared to legacy MDM software.
Effective hierarchy management provides a structure to understand the relationships between master data items within an organization. With proper hierarchy management, master data entities can be segmented and categorized to gain meaningful insights into customer activities, business operations, and strategic objectives.
Deciding What Master Data to Manage
Organizations may attempt to manage many different types of master data records as a general approach; however, this can lead to problems in terms of tracking, cleaning, and maintaining various master data sets. Organizations should identify their core business processes and operations and then determine which master data they need to support and analyze those functions. Once the key master data points are identified, the organization can proceed with designing effective solutions that reduce costs, improve accuracy, and provide valuable insights into customer needs.
How Do You Create a Master List?
To create a reliable master list, the reference data must be correctly identified and mapped, ensuring that each data point is relevant and accurate. Quality assurance protocols should then be put in place to help categorize and organize the master data. The master list should be updated on a regular basis to avoid any discrepancies between systems or outdated information.
What are the benefits of Master Data Management Software?
A comprehensive MDM solution can simplify compliance by bringing together all the data within an organization and effectively managing it. Having a complete overview of all relevant data in one application helps ease compliance with industry regulations and data privacy policies. With MDM, automated processes are used to keep master data up to date, reducing the need for manual intervention. This simplifies the process of maintaining compliance and allows organizations to manage their master data safely and reliably in accordance with industry standards.
Master data management is an essential step of improving compliance. A good MDM solution gives organizations the ability to properly identify and monitor data assets while using data governance rules ensuring they are stored securely and only accessible to a select few authorized users or entities. Master data management also helps organizations keep track of changes and enforcement of policies while providing flexibility to respond quickly which helps reduce non-compliance risk.
Lower total cost of operations
As businesses grow, a master data management program is one of the keys to reducing the total cost of operations. Through master data management software, companies can consolidate all essential information into a single source of truth, making vital data readily available for informed decision-making across all departments of the organization. This not only results in increased organizational efficiency but also significantly reduces associated data processing costs in the form of manual stewardship and additional applications.
Improved customer experience and satisfaction
Making sure that data is managed efficiently is a crucial factor in improving customer experience and satisfaction. By consolidating data into one source, customer information can be seamlessly shared across multiple points of contact in the organization. This reduces the risk of errors while allowing the organization to serve its customers in a more integrated and precise manner.
Identify and act on insights faster
By utilizing an MDM solution, organizations can increase operational transparency and gain access to granular insights into customer preferences, utilization trends, consumer behavior, product data, and other information. Doing so will allow them to make smarter decisions, respond quickly to changing trends and preferences, launch campaigns with confidence, and become better equipped at predicting where the market is headed.
Flexible and multi-domain
Flexible and multi-domain master data management solutions are indispensable for modern businesses. These solutions provide the stability, accuracy, traceability, and access needed to master and connect disparate datasets across multiple systems. With scalability features that allow enterprises to increase or decrease record processing capabilities on demand, these solutions can easily adapt when organizations have changing requirements.
Common challenges and solutions in Master Data Management
Master data management has become increasingly complex for organizations due to vast increase in data generated across industries. As a result, common challenges within MDM systems include the creation of persistent, accurate identifiers for important entities such as patients, members, consumers, and providers; integration of data from multiple sources; and keeping track of different versions of the same information. Solutions to these challenges include consolidating corporate data into a single system and automating processes throughout the enterprise with consistent rules. MDM can help ensure data accuracy and consistency through systematic processes that identify errors quickly and eliminate manual steps. Additionally, leveraging a cloud-based platform can assist in keeping valuable customer data centralized and secure while managing large volumes of records efficiently.
Best practices for implementing Master Data Management
Master data management is a critical tool for any business looking to benefit from improved data integration and increase their overall operating efficiency. To ensure that an MDM implementation is successful, organizations should keep best practices in mind. These include selecting the right platform that meets the specific requirements of the business, thoroughly testing different scenarios before integrating MDM with other internal processes and systems, involving stakeholders throughout the process to ensure ownership of MDM, and keeping up with ongoing maintenance after implementation has been completed.
Integration of Master Data Management with other systems and technologies
Integrating an MDM solution with other systems and technologies ensures organizations get the highest value out of their data management strategy. By centralizing key data assets and unifying disparate silos of data, organizations have visibility into their entire enterprise ecosystem, allowing them to capitalize on opportunities with greater agility. Additionally, MDM can help drive business intelligence by supplying analysis into customer behaviors and preferences. Feeding MDM’s insights into automated systems can further maximize the potential to better serve customers while delivering real-time, reliable data across the organization.
Master Data Management solutions for specific industries
MDM solutions are critical for managing and maintaining data quality, consistency, and accuracy across multiple systems and applications. While MDM is essential for all industries, specific industries require tailored solutions to meet their unique needs.
The healthcare industry faces distinctive challenges when it comes to managing master data. In addition to generating enormous amounts of data from various sources such as EHRs (Electronic Health Records), claims, and clinical systems, data management, and security standards are much more stringent to comply with regulatory requirements.
On a day-to-day basis, MDM solutions for the healthcare industry must be able to manage and maintain patient, provider, member, and consumer data accurately and securely across different systems and applications. To achieve this, solutions must be able to link patient data across disparate sources and applications while ensuring data quality by detecting and eliminating duplicate patient records.
The government, including local and state governments, manages massive amounts of data across different departments and agencies. Effective MDM solutions can help government agencies manage data across different domains such as health, education, and public safety. Identity solutions for the government must provide a way to manage and maintain data across different systems while ensuring data accuracy and consistency.
Health Information Exchanges (HIEs) enable the exchange of health information between different healthcare organizations. To ensure the correct patient information is shared between health systems, HIEs must implement strategies so that data is accurate, consistent, and secure across diverse sources and applications. An MDM solution supplies the right tools to achieve this goal for improved patient satisfaction and safety.
Payers, or health insurance companies, manage data related to members, practitioners, health systems, claims, and benefits. This data comes from many diverse sources which can make it difficult to identify the correct information for different applications. Failure to manage data appropriately may lead to denied claims, incorrect provider directories, and other frustrating experiences for members and practitioners. Payers need an MDM solution that is suitable to these use cases for improved member and provider satisfaction.
Healthcare systems generate and store patient, provider, practitioner, consumer, and employee data across different systems—EHR systems, CRM applications, digital front doors and other consumer portals, and many other data sources. To treat patients effectively, engage consumers, and manage practitioners, health systems need a 360-degree view of every person across their enterprise. An MDM solution built for provider needs enables improved patient satisfaction and safety while balancing business objectives.
Master Data Management trends and future directions
MDM enables companies to effectively organize and manage vast amounts of data. As the amount of data in organizations continues to expand, MDM solutions are needed to ensure that business functions run efficiently. To meet these challenges, MDM technologies must not only provide reliable organizational solutions but continually evolve to meet future needs. As current and future business needs and use cases vary widely by industry, some organizations in industries like healthcare are choosing MDM solutions that were purpose built to solve industry-specific data management challenges. By staying ahead of the trends and advancing their systems, companies can benefit from better insights into their businesses and develop more strategic approaches to improve operations.
Master data management is a foundational business practice for companies across industries. Implementing an effective MDM strategy can reduce operating costs, improve compliance and safety, and streamline business operations. For more information on how an MDM solution can boost the success of your healthcare organization, watch this webinar or book a strategy session with one of our experts.