Reference Data Management, Its Features, and Benefits.
Reference data is the subset of the master data which is used for data classification and is the most shared class of data in an entire organization. Reference data may originate either externally (from 3rd party data sources) or internally (within an organization) and is described in one-to-one and one-to-many relationships or depending on hierarchies.
Companies are now focusing on ways to improve data efficiency and are opting for reference data management by deploying MDM (Master Data Management) strategy to provide a consistent and single view of business data across the organization. Master Data Management helps to remove the duplicate, disparate, and any different information to simplify business intelligence and reporting which will enable companies to gain better business insights and take informed business decisions.
Reference data is the most overlooked data type in many organizations but constitutes a vital area of data management which can lead to further complexity in data management. Though the amount of reference data in most enterprises is relatively small, it can create a major difference in data management. Reference data can be found in extra-transform load (ETL) mappings, data warehouses, relationship databases, spreadsheets, and more such areas.
There are a plethora of challenges that enterprises face while working with their respective reference data. For instance, ERP and CRM solutions may use different country code types. Integrating the data across many applications requires the company to translate between different table representations.
For robust reference data management, companies must set reference data management frameworks, policies, and standards to manage and govern both external and internal data. Added to this, Reference Data Management (RDM) has become one of the important elements in Master Data Management(MDM). Reference Data Management provides the processes and technologies for harmonizing, recognizing, and sharing data sets for “reference” by different consistency (people, systems, and other master data domains). Reference Data Management Software helps to manage complex mappings between different data domains and reference data representations across the organization. RDM systems provide connectivity that includes SPA (service-oriented architecture) for sharing reference data with enterprise applications, analytical and governance applications.
Why Reference Data Management is Vital?
Prior to RDM Solutions, many enterprises used to opt for custom solutions using software such as spreadsheets, workflow software, RDBMS, and other tools. Such systems lacked security, permission management, change management, and audit controls. These types of solutions become compliance risks as reference data is used for key business applications and processes.
Key features of Reference Data Management.
- Auditing and versioning capability
- Ability to publish reference data
- Efficiency in hierarchy management
- Effective functionality of load/extract
- Search capability with less error rate