IDC expects market for services and software to reach $10.4 billion by 2009 as global companies prioritize investments
Framingham, MA October 21, 2005 Motivated by business goals such as compliance and supply chain efficiency, global companies are prioritizing investments in master data management, and this trend will help push the market for master data management to $10.4 billion by 2009, with a compound annual growth rate over the next five years of 13.8 percent, according to a new IDC study.
Master data management involves a set of processes to create and maintain a single view of products, customers, accounts or locations, through a physical or logical hub, across the enterprise or, in some cases, across enterprises.
Mix of Old and New
The total master data management market is a mixture of old and new sectors, reflecting a history of enterprises attempting to deal with the challenge of providing a single view of the entities needed for conducting business and measuring its performance. Older terms (such as product information management, customer data integration and financial consolidation) reflected efforts to provide a single view of one type of master data.
IDC has been tracking these applied master data management software segments for over a decade, as software applications came on the market in the 1980s and 1990s that could be sold to individuals with functional responsibility for specific types of data. What is new is the emergence of master data management infrastructure software that is purpose-built to support any and all types of master data, utilizing a combination of techniques from data and content technologies.
"Maintaining a single view of products, customers, locations, and financial accounts is a significant challenge," said Dr. Henry Morris, group vice president and general manager for IDC's Integration, Development and Application Strategies research. "At its heart, master data management involves changing, consolidating and rationalizing core processes such as new product introduction or customer (or patient/citizen/supplier) registration and ongoing management. The greatest complexity comes from these business process changes and process integration issues, over and above the data integration requirements."
The Three Scenarios
The report examines master data management services, as well as master data management software, and finds the opportunity for services to be larger, reflecting the increasing complexity and scope of master data management implementations over the 2005-2009 forecast period.
IDC has identified and analyzed three types of current master data management scenarios, reflecting the diverse set of projects now being undertaken:
The study, "Master Data Management: Worldwide Software and Services Forecast, 2005-2009," tracks the growth of the worldwide market for master data management software and services in 2004, provides a five-year forecast through 2009, and discusses issues in project implementations based on interviews with master data management consultants.
Additional Articles of Interest
For a look at how Canadian company McCain Foods is overcoming data synchronization challenges in its supply and demand chain, see the article "Building a 'Trusted Source'" in the April/May 2004 issue of Supply & Demand Chain Executive.
Companies with advanced sourcing and procurement strategies are using spend analysis tools to drive bottom-line savings. Now it's time to take spend analytics to the next level. Read more in "Supercharging Spend Analytics," in the April/May 2005 issue of Supply & Demand Chain Executive.
For more information on best practices for spend analysis, see the following SDCExec.com articles:
Framingham, MA October 21, 2005 Motivated by business goals such as compliance and supply chain efficiency, global companies are prioritizing investments in master data management, and this trend will help push the market for master data management to $10.4 billion by 2009, with a compound annual growth rate over the next five years of 13.8 percent, according to a new IDC study.
Master data management involves a set of processes to create and maintain a single view of products, customers, accounts or locations, through a physical or logical hub, across the enterprise or, in some cases, across enterprises.
Mix of Old and New
The total master data management market is a mixture of old and new sectors, reflecting a history of enterprises attempting to deal with the challenge of providing a single view of the entities needed for conducting business and measuring its performance. Older terms (such as product information management, customer data integration and financial consolidation) reflected efforts to provide a single view of one type of master data.
IDC has been tracking these applied master data management software segments for over a decade, as software applications came on the market in the 1980s and 1990s that could be sold to individuals with functional responsibility for specific types of data. What is new is the emergence of master data management infrastructure software that is purpose-built to support any and all types of master data, utilizing a combination of techniques from data and content technologies.
"Maintaining a single view of products, customers, locations, and financial accounts is a significant challenge," said Dr. Henry Morris, group vice president and general manager for IDC's Integration, Development and Application Strategies research. "At its heart, master data management involves changing, consolidating and rationalizing core processes such as new product introduction or customer (or patient/citizen/supplier) registration and ongoing management. The greatest complexity comes from these business process changes and process integration issues, over and above the data integration requirements."
The Three Scenarios
The report examines master data management services, as well as master data management software, and finds the opportunity for services to be larger, reflecting the increasing complexity and scope of master data management implementations over the 2005-2009 forecast period.
IDC has identified and analyzed three types of current master data management scenarios, reflecting the diverse set of projects now being undertaken:
- The Management Reporting Scenario reconciles, rationalizes or organizes master data at the hub to drive reporting for compliance and business performance management (BPM).
- The Data Synchronization Scenario builds consistency in operations by synchronizing master data from the hub back to local systems.
- The Single Point of Origination Scenario requires that all changes to master data originate at the hub for real-time consistency in operations.
The study, "Master Data Management: Worldwide Software and Services Forecast, 2005-2009," tracks the growth of the worldwide market for master data management software and services in 2004, provides a five-year forecast through 2009, and discusses issues in project implementations based on interviews with master data management consultants.
Additional Articles of Interest
For a look at how Canadian company McCain Foods is overcoming data synchronization challenges in its supply and demand chain, see the article "Building a 'Trusted Source'" in the April/May 2004 issue of Supply & Demand Chain Executive.
Companies with advanced sourcing and procurement strategies are using spend analysis tools to drive bottom-line savings. Now it's time to take spend analytics to the next level. Read more in "Supercharging Spend Analytics," in the April/May 2005 issue of Supply & Demand Chain Executive.
For more information on best practices for spend analysis, see the following SDCExec.com articles:
- The Secrets of Successful Spend Analysis
- Spend Analysis a Top Priority, But Not Widely Adopted...Yet
- Manufacturers: Achieve True Strategic Sourcing Through Spend Analysis
- More research from IDC.
