Lower Interface Costs an Important Factor

By eWEEK Staff  |  Posted 2012-05-11 Print this article Print

The following was provided by Ravi Shankar, Senior Director of Product Marketing at Siperian, maker of a "flexible" master data management platform.

MDM Cost Reduction Benefit  No. 1:  Lowers 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.

MDM Cost Reduction Benefit No. 2:  Eliminates redundant third party data costs

Eliminating duplicate data acquisition from external data providers can account for significant cost savings.  For many companies, integrating third party data from institutions such as Dunn & Bradstreet, Acxiom, IMS or Reuters is a key requirement for their business operations.

Frequently, however, different departments within the same company will source data for their own uses, unaware that another division within the company already procures the exact same data from the same source.  The cost of these duplicate data acquisitions has a multiplier effect. 

With MDM, the third-party data is integrated directly into the MDM system and then distributed out to all downstream applications.  This reduces the duplicate data acquisitions to just one! 

MDM Cost Reduction Benefit No. 3:  Cuts data cleanup costs

Cleansing data centrally in an MDM system can account for significant cost savings.  Most companies have invested in data quality tools to clean up data within an application for a specific business purpose such as direct marketing.  Later, as data quality requirements grow for other business purposes, companies continue to cleanse the data within other respective business applications. 

This causes two problems.  First, the costs for multiple uses can compound and significantly impact the IT budget.  Second, since the cleansing is done individually by application, duplications across applications are not taken care of. 

By integrating the data from these disparate applications into a central MDM system, it becomes possible to cleanse all data across the enterprise in a single system.  This approach helps not only to resolve conflicts across source applications, but also makes it possible to create and store the history and lineage of any changes to the data. 

Thus, by centrally cleansing the data, companies can save on license and support fees for additional instances of data quality tools.


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