Chapter 2: Why MDM Is Needed -- Master Data Silos Issues
Mergers and acquisitions can complicate existing master data issues. Learn why SAP ERP 6.0 deployments can make it difficult to reconcile conflicting MDM processes, and how SAP NetWeaver MDM programs can resolve this.
Effective Master Data Management with SAP NetWeaver MDM, Ch. 2
Table of contents:
Using SAP NetWeaver MDM with CRM, SCM and NetWeaver BI
Designing your SAP NetWeaver master data management strategy
The importance of master data management following mergers and acquisitions
Enterprise MDM: SAP MDM for reducing data silos and duplicate records
2.3 Case Study 2 — Impact of Mergers and Acquisitions
Companies often grow with mergers and acquisitions, which compounds the master data issues. Each of the merging companies will already have its own business processes, procedures, and business applications where customer and vendor records are maintained.
Let's now consider the example where Company CO1 (from Case Study 1) has recently merged with Company CO2. As already discussed, Company CO1 systems architecture has five applications. Now in addition, Company CO2 has one SAP ERP 6.0 application plus an SAP CRM and an SAP NetWeaver BI application.
Figure 2.2 shows the combined Company CO1 and Company CO2 system architectures.
Case Study 2 – Merger of comp Table 2.3 shows the applications and the organizational teams that initially maintain the customer and vendor data when the companies merge.
Unfortunately, these data standards are also not established for Company CO2. At the time of the Company CO2 data conversion process, all existing legacy records were transferred into the SAP ERP 6.0 application. This included duplicate, out-of-date, and inactive customer and vendor records.
|Application||CO1 Application||CO1 Organization||CO2 Application||CO2 Organization|
|Supply Chain Management||Non-SAP||CO1 Supply chain management organization||SAP SCM||CO2 Supply chain management organization|
|Financial Accounting||SAP FI CO component (CO1 instance)||CO1 Financials (AP) team||SAP FI CO component (CO2 Instance)||CO2 Financials (AP) team|
|Customer Relationship Management||Non-SAP||CO1 Marketing and sales representatives||SAP CRM||CO2 Marketing and sales representatives|
|Sales and Distribution||Non-SAP||CO1 Customer services division||SAP SD component||CO2 Customer services division|
|Financial Accounting application||SAP FI CO component (CO1 Instance)||CO1 Financials (AR) team||SAP FI CO component (CO2 Instance)||CO2 Financials (AR) team|
|Business Intelligence||Non-SAP||CO1 Marketing organization||SAP NetWeaver BI||CO2 Financials team|
It is invalid to assume that if a company has deployed an integrated SAP solution that it has also successfully tackled the master data issues. SAP ERP 6.0 deployments can be complex, and the quality of the master data can become a secondary issue for an implementation team when the pressures of an imminent go-live deadline approaches.
Your SAP NetWeaver MDM program should work closely with your major business deployment programs. Initially loading bad master data into a business application will severely impact the value of both the system and your SAP NetWeaver MDM program, and resolving the data issues after it has been created takes considerable effort.
The problems of managing the business partner master data processes and sharing the data across the systems are now compounded with the merger of Companies
|Application Name||Vendor Active Records||Transactions in the Past Two Years||Customer Active Records||Transactions in the Past Two Years|
Your business leaders now have slightly different questions:
Once again, it's back to the key master data questions. Before attempting to answer these important questions, you need to answer the following first:
Unfortunately, the questions are now even more difficult to answer. You can see from Table 2.4 that in total, there are 51,500 vendor records and 59,000 customer records set up in the various business applications across the two companies. However, there is no easy way to link the Company CO1 business partners to the Company CO2 business partners.