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Embrace product data complexity or it will be the end of you

This blog presents an idea of how you can stand out amongst your peers. Can you spot it?

Being data professionals we know that the product master is by far the most complex Master Data in a manufacturing or distribution organization. It’s usually also some of the most important data that they have. Yet most people we meet that works with this, are surprisingly relaxed about their product data.

In some organizations it can get extremely complicated. Some facts from a few clients:

  • Distributor:
    • Field of operations: 7 countries.
    • Product master size: 1.7 mio. articles.
    • New articles a year: 300.000-400.000
  • Manufacturer:
    • Field of operations: 45 countries.
    • Product master size: 1 mio. articles. (materials and finished goods).
    • Unique attributes: 8000
    • New articles a year: 250.000

Let’s reflect a bit on these numbers.

If you are creating 300.000 – 400.000 new products a year (that’s a little more than 4 every business second!), you are likely looking at massive handling costs, unless this area receives special attention.

8000 unique attributes – each attribute holds one characteristic of a material or a product, e.g. it’s length, voltage or color. For each of these unique attributes, unique business rules need to be specified to ensure data is captured in the right way depending on the requirements.

When the size of the product master is around 1.7 mio. articles, with an average of let’s say 50 attributes per product, you are looking at 85 mio. values growing at 12,5 mio./year that need to be correct. Realizing these facts, the people I mentioned before should at least start to feel a bit uneasy.

Bearing the fact in mind, that the most common challenges we see at our clients, are the challenges that shouldn’t even exist (or in other words most client do not have their house in order) one should definitely start to worry.

In many cases there are only few business rules in place for the product master, and those that are, are not commonly known across countries. Data is scattered throughout the IT landscape, with no common trusted source. No one has an overview of who uses the data and for what purpose. And when issues are discovered most organizations are not able to answer the simple question of who is responsible thus failing effectively to address the issue. If the people I mentioned in the beginning understood all of this, I suspect they’d have issues sleeping at night.

Of course we as information specialist can help out with much of this, but our clients can do more than just attacking the superficial issues. The current complexity of a product master is usually not the result of careful deliberation and a meticulous design process. Rather it sort of just grew into what it is. If that’s the case, chances are, our clients can reap significant benefits by rethinking how they handle their products.

There are a few strategies to choose from:

  • Thinking in configurations: rather than allocating a new product number each time you have a variant, can you handle variations in grouping of rules of what can be allowed to vary on a basic product (e.g. a car or a piece of equipment or say furniture)?
  • Thinking in product platforms and standards: rather than each individual product being completely different in its design, would it make sense to adopt a strategy where core aspects of the products are the same and variation is built on top of this? Or just that e.g. interfaces follow the same standards rather than being different because they can? The car manufacturing industry (e.g. Toyota) is perhaps the best known example of such an approach.

Both these strategies are well-known to consultants and software providers focusing on discrete manufacturing, but perhaps not to the general data people. 

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About Kjell Wittmaack

Kjell Wittmaack is an industry expert and thought leader within the field of Information Management. As Partner Mr. Wittmaack heads up the advisory practice globally for Platon – the leading independent Information Management consulting company. Mr. Wittmaack advises clients across industries on Information Management issues, linking challenges, business strategy and practical execution. He is a frequent acknowledged speaker and panelist at conferences around the world.

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