Many organizations have multiple software systems supporting
their supply chains. Warehouse management systems, ERP systems, and
other software used for procurement, inventory, and transportation
processes can have conflicting data.
The isolation of these different software systems can lead to
confusion within the enterprise, as different areas wonder whose
data is "right." A far more serious result is that an
organization can have an incomplete picture of its inventory, which
can then lead to overpurchasing, stockouts, and disruption in
manufacturing operations. For procurement, inconsistent data can
lead to higher order fulfillment times and increased transaction
processing costs. Organizations using the services of third-party
logistics providers (3PLs) can see even more confusion if the
3PLs have completely data from the organizations.
One solution to data inconsistency is material master data
management, or the standardization and centralization of data into
a uniform set. Adopting material master data management means that
the entire enterprise gets a single view of supply chain data. This
can lead to more efficient manufacturing operations, better
inventory management, and reduced cycle times, which all translate
into reduced cost. The material master data set can be used by
various applications across the enterprise, including those for
purchasing, inventory management, and materials planning.
There are challenges to adopting material master data
management. For a large company, supply chain data can be dispersed
in different business units located in different geographical
areas. Available data may have poor descriptions or inconsistent
naming conventions. Moreover, organizations will need to establish
ownership of the master data and processes for data creation.
Has your organization adopted material master data management?
What challenges did you encounter? What benefits have resulted from