In an article today Peggy Bocks of EDS asks whether MDM is all hype. I think it is fascinating how some terms in technology catch on, while others wither away. In 2002 MDM was essentially an unknown term. I recall discussing with analysts calling our new Kalido product offering “Kalido MDM” and being greeted with polite derision, since this was “not a market”. Customers seemed to recognize the problem though, and I discovered that we were not alone when SAP launched their own SAP MDM offering soon afterwards. Though that product is now retired, when a vendor the size of SAP anoints a term then you can be sure that the industry will take it more seriously than when a start-up uses it. Three years on and there is a much higher level of noise around MDM, with around 60 vendors now claiming to have some sort of MDM offering, at least in Powerpoint form. Moreover further validation has come from Oracle (with its Data Hub), Hyperion (who bought Razza) and IBM, who have bought several technologies related to MDM. IDC reckon the market for MDM will be worth USD 9.7 billion within fove years.
However, I do have some sympathy with Ms Bock’s point – a lot of MDM at present is froth and discussion rather than concrete projects. Certainly Kalido has some very real MDM deployments, Razza has some, Oracle presumably does, and SAP managed about 20 deployments before giving up and starting again, buying A2i and retiring its existing offering. Still, outside the tighter niches of product information management and customer data integration (arguably a subset of the broad MDM market) this hardly constitutes a landslide of software deployments.
A skeptic would argue that the industry has got these things wrong before, getting all excited over technology that fizzles out. Remember how “e-procurement” was going to take over the world? Ask the shareholders of defunct Commerce One about that trend. I recall IDC projecting some vast market for object databases in a report they published in 1992, and at the time I wrote a paper at Shell arguing that the ODBMS market would likely never get even close to a billion dollars, and indeed it never did. However object databases always struck me as a solution in search of a problem, whereas the issues around managing master data are very real, and very expensive, for large companies, and they are not well addressed today. There are major costs associated with inconsistent master data e.g. deliveries being delivered wrongly, duplicate stock being held etc. Shell Lubricants though they had 20,000 unique pack-product combinations when in fact they had around 5,000, meaning major savings to be had through eliminated duplication in marketing, packaging and manufacturing, for example.
Because it addresses a real business problem, with the potential for significant hard business savings, I believe that the MDM market will in fact catch light and grow, but there will inevitably be a confusing period while analysts get their heads around the new market and start to segment it, and customers begin to understand the various stages they need to go through in order to run an effective master data project.