Master Data Management as a tool to improve business profitability

Abstract

Master Data is a topic whose importance is increasing exponentially due to the fact that it has a severe impact in the overall profitability of companies, even if it is not a direct matter neither in the incomes nor in the benefits. Thus, the aim of this Thesis was to explain from the pillars what is this issue, how it is linked to companies, how it affects the business process and finally which solutions exist to prevent and solve its subsequent problems. The method to research how Master Data Management impacts profitability was a business case implemented through SAP ERP. In the case, a wholesale company purchased products from Nestlé and sold them to EcoMarket, a supermarket chain. The study focused on how diverse processes developed within the system and how Master Data was involved. Two scenarios were considered: Firstly, a good management was performed where I put into practice different maintenance methods that had been previously exposed. Secondly, the opposite situation was carried out in order to prove the concrete consequences derived from a poor management. Based on the results of the comparison, it can be said that the implications of a poor Master Data Management are visible even in the most basic procedures. Profitability losses can appear in different shapes, some of them direct (such as expenses increase) and others indirect (such as time waste or customer dissatisfaction). To conclude, I propose an approach that combines IT and business with the aim of framing the Master Data problem. The reason is that most of the current conducted studies focus on the technical scope but, according to current surveys, the main cause of poor Master Data is business data entering. Therefore, I believe the Master Data Management solutions should not be only concentrated in the technical aspect, and spread out covering both angles.