What is Reference Data? Reference data includes lists such as country codes, currency codes and product types and is found in practically every enterprise application including back-end systems, front-end commerce applications, and data warehouses. It turns other data into meaningful business information and provides an information context for the wider world in which the enterprise functions. Yet it is rarely managed well and data duplication and inconsistent mappings across applications can lead to costly business errors.
“While reference data may not change frequently, errors in reference data can ripple out, which will affect the quality of master data. As such, it makes sense that one of the key findings of this survey indicates that for organizations planning a master data management or data governance strategy, reference data management should strongly be considered as a starting point,” stated Aaron Zornes, founder and chief research officer for the MDM Institute. “Organizations should strongly consider buying a purpose-built RDM solution versus attempting to build an in-house solution.”
Other key findings from the survey include:
- Enterprise architects and other enterprise IT executives tend to be either the gatekeepers or the budget holders for RDM.
- RDM is gaining enterprise-level relevance and is often directly coupled to business stakeholders.
- Few to none believe their RDM programs are “effective.”
- Most survey respondents are planning on investing in RDM within 2 years
- Multi-phase RDM programs are typically in multi-million US$ range.
- Most organizations are “living dangerously” via custom-built RDM solutions that are not robustly governed (auditable, secure, etc.)
- Few enterprises are satisfied with the tools in use for RDM, a direct result of inadequacies/failure of do-it-yourself solutions.
- Considerable interest in integrating enterprise applications with RDM. Increase in analyst inquiries shows interest in tying analytical enterprise applications (Business Intelligence/Big Data) to RDM.
- Considerable interest in RDM to support traditional MDM initiatives.
- Reporting, regulatory compliance, ad hoc management and proliferation of data sources are key business reasons for pursuing RDM.
- Reporting and reconciliation are also top IT drivers for RDM as their goal is to provide a source of consistent and accurate reference data to organization and applications.
- Thirty-five percent of enterprises are looking at commercial RDM, yet a high number are looking at alternative tools such as Metadata Repositories, which is a major concern because these show high historical failure rates as RDM solutions
- Multiple vendors are typically shortlisted for RDM software evaluations including mega vendors (IBM, Informatica, Oracle, SAP) and best-of-breed (purpose-built RDM) however, best-of-breed typically have lower price points and a faster time-to-value
- RDM capabilities most critical to success include (as indicated by 50% or more of respondents)
- Ability to verify that enterprise systems are using the correct reference data
- Ability to maintain governance information about a reference data set (e.g., where sourced from, where used, how frequently it changes, who is responsible for it)
- Automated consistency maintenance across reference data (e.g., through enforcement of data quality rules for reference data)
- Semantic integration across business concepts, reference data and technical metadata
- Capture of and access to the meaning (semantics) of reference data
To listen to a recent webinar recording in which TopQuadrant and Aaron Zornes presented these findings as well as discussed the capabilities that enterprises see as the most important for RDM success, please visit “Why is Reference Data Governance Mission Critical?”
About MDM Institute
The MDM Institute is the world’s leading research and advisory consultancy exclusively focused on master data management. As chief research officer, Aaron Zornes delivers the technologyrelated insight necessary for its clients to make the right decisions in their use of master data management (MDM), customer data integration (CDI), reference data management (RDM) and data governance solutions to achieve their customer-centric business goals. The MDM Institute provides authoritative, independent and relevant consulting advice to senior IT leaders in corporations and government agencies, to business leaders in high-tech enterprises and professional services firms, and to technology investors. The MDM Institute delivers its research and advice to more than 60,000 clients in 10,500 distinct enterprises via Twitter, Linked In, Xing, Google+ and email newsletters. Additionally, each year more than 2,000 paid delegates attend its MDM & Data Governance Summit conference series held in London, New York City, San Francisco, Singapore, Sydney, Tokyo and Toronto (now in its seventh year). Founded in 2004, the MDM Institute is headquartered in San Francisco and has clients primarily in North America, Europe and Asia-Pacific. For more information, visit http://www.the-mdm-institute.com.
As an Enterprise Information Management (EIM) innovator, TopQuadrant helps organizations succeed in data governance by managing information regardless of its structure, origin or location so that it can be easily organized, shared and exchanged. Our products use standards-based graph technologies to provide our customers with agile information management capabilities— because connections are important.
TopBraid Reference Data Manager™ supports the governance and provisioning of enterprise metadata and reference data. TopBraid Enterprise Vocabulary Net™ supports collaborative management of taxonomies, business glossaries and ontologies and offers auto-classification of documents and search enhancement. TopBraid Insight™ is a semantic virtual data warehouse that enables federated querying of data across diverse data sources as if they were in one place. TopQuadrant customers include many government agencies and Fortune 1000 companies in numerous industries including pharmaceutical, financial services, energy and digital media. For more information, visit http://www.topquadrant.com.
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