Data Governance is a Prerequisite for Effective MDM and Data Quality


Dave Waddington

Dave Waddington is senior vice president and co-founder of The Information Difference, an analyst firm specializing in data quality, master data management (MDM) and data governance. He is a recognized authority and practitioner in the field of data management and has advised both vendors and corporations on data management strategy and architecture.

The Information Difference today released the results of a new study we conducted on the relationship among data governance, master data management (MDM) and data quality. Quite a bit has changed since we conducted a benchmark study on data governance adoption in the summer of 2008, but we wanted to measure exactly how much. We also wanted to explore the scale, scope and success rates of data governance integration with MDM and data quality initiatives given the relative maturity of those two markets and their close relationship with data governance. Two hundred and fifty-seven respondents, primarily from North America and Europe, completed our online survey. They represent a wide range of industries, but the majority of participants work in banking, insurance and financial services.

What a difference two years has made. Seventy-one percent of those surveyed have implemented a data governance program or plan to within one year. This is 30 percent more than in the 2008 study. One reason for the marked increase is that enterprises understand the strategic advantages data governance can deliver. The top two motivations for implementing data governance (for both those already in production and those planning implementations) were “better quality and faster decision making” and the “ability to respond faster to business change.” Better still, they’re not disappointed. Seventy-nine percent of study participants with active data governance programs viewed those programs as a success. This strongly suggests that data governance delivers on its promises.

The vast majority of those surveyed believe that it is imperative to have a data governance program in place prior to or in conjunction with implementing data quality or MDM programs.  Among the cohort with an active data governance program, 79 percent expressed this opinion. Bear in mind that this is based on actual experience. We at The Information Difference concur based on our field experience and research. In addition, 88 percent of those planning to undertake data governance feel the same. Of the latter group, a scant 6 percent felt that data governance was not essential to the success of MDM and data quality. Maybe they’ll reconsider after reading the full report.

Lest I give the wrong impression, I’ll definitively state my view that data governance remains an emerging market. It’s maturing faster than anyone had predicted, but it’s still growing. Enterprises with active data governance programs and those planning to introduce data governance to their organizations certainly have challenges. Currently, there is little in the way of tools to support data governance processes and operationalize data governance programs. Spreadsheets, intranet postings and repurposed, ersatz tools aren’t sufficient. Some vendors of data quality and MDM tools suggest that they have data governance functionality, but closer examination reveals that these are often superficial. We expect savvy technology providers to deliver purpose-built, enabling technologies for data governance in the near future. Kalido plans to ship Kalido Data Governance in the fourth quarter of this year. Kalido has said that its data governance solution will manage data policies, operationalize data governance processes and measure and improve data policy compliance.  Critically, the Kalido data governance product does not require Kalido MDM technology. Indeed, several companies in the Kalido Lighthouse Customer Program use MDM platforms from other vendors.  We think they’re approaching data governance from the right angle.

There also need to be internal changes. For example, only half of organizations with active data governance programs prepare a formal business case for investing in data governance. One wonders how the other half convinced their executive teams to commit to implementation without one. After all, data governance is an ongoing effort, not a one-time undertaking. Tracking and reporting key operational metrics is also largely missing. Measurement is an important next frontier in data governance.

In the end, however, the early results delivered by data governance programs are overwhelmingly positive and portend more good things to come. The Information Difference will eagerly track and contribute to the development of this exciting data management discipline.

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4 Responses to “Data Governance is a Prerequisite for Effective MDM and Data Quality”

  1. Lindsey Niedzielski August 27, 2010 at 10:47 am #

    Great post Dave. I really like your analysis of the importance of a formal business plan. I agree, data governance is not a one time investment, both in time and resources. We have a community for IM professionals (www.openmethodology.org) and have bookmarked this post for our users. Look forward to reading your work in the future.

  2. John Owens August 29, 2010 at 4:52 pm #

    Hi Dave, Great article.

    Though I agree that more companies should be growing their Data Governance and MDM, I am worried that this is becoming an industry in its own right within enterprises.

    Far too often, you get “business as usual” and, over and above that, Data Governance and MDM. Data Governance and MDM are only effective when they are achieved as a fully integral part of the day-to-day Business Functions of the enterprise.

    Perhaps it is the fact that these are immature disciplines that causes this. Such separation often happened in the early days of Quality Assurance. At that time, many executives who saw themselves as quality “experts” used to do their ordinary job Monday to Thursday and spend all day Friday on “quality” – I actually heard many boast that they did this!

    But, as the whole world now knows, if you spend your time working on quality, you have not got it!

    So, if you are committed to Data Governance and MDM, instead of working on them, make sure that all that is required to achieve them is is built into the day-to-day functions of the business.

    Regards
    John

  3. Brijesh May 28, 2013 at 9:26 am #

    Hi
    Before stating the project what are the question need to be asked from the clients and what the the points which help in diciding the pricing

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  1. Data Governance Maturity? Or Immaturity? | Kalido Conversations - November 11, 2010

    [...] 39% of respondents were from business roles. Consistent with other surveys such as the recent Information Difference survey, about 40% of organizations say they have data governance programs up and running, more than a [...]

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