Master data management is the process of governing the data generated in an organization in order to keep the functioning of the organization aligned with a common data bank and to establish a common data source for all arms of the organization. Master data management thus helps the productivity of the organization immensely, since conflict between data points is avoided. Master data management is vital in ensuring optimum function of the various arms of an organization, as the lack of a common data point can lead to conflicting actions being taken by different arms of the organization towards the same customer.
The steady development of the prevalent customer-centric approach among businesses has led to a growing acknowledgement of the importance of master data management solutions. According to Transparency Market Research (TMR), the global master data management solutions market is likely to exhibit a stellar 27.25% CAGR between 2016 and 2024. The market was valued at US$4.3 bn in 2015 and is expected to rise to a valuation of US$37.9 bn by the end of 2024.
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What is driving the master data management market?
While the overarching development of the customer-centric–rather than service-centric–view in businesses has been the prime driver for the global master data management market, the rising volume of data being generated by organizations due to the use of modern customer engagement channels is a leading proximal driver for the market. Social media and other online channels have already become a vital asset for any non-niche organization, as they enable direct engagement with the users. The voluminous and diverse data generated from such operations needs to be stored and monitored with adequate care so as to enable easy access whenever needed. This is likely to remain a key driver for the master data management market in the coming years.
The rising demand for cloud computing has also benefited the master data management market, as cloud storage can be a valuable asset for data management. Due to the widespread popularity of cloud computing in North America and Europe, these two regions are the leading contributors to the global master data management market. However, the rapid rise in IT expenditure observed in the corporate sector in Asia Pacific has furthered its claims as a lucrative, emerging market for master data management players to keep an eye on.
What are the key applications of master data management?
The BFSI sector has become a key consumer of master data management solutions due to the gradual transformation brought about by the digital revolution. In contrast to conventional banking, which consisted of customers visiting brick-and-mortar banks, modern banking services are increasingly being provided through various digital media, which leads to significant diversification in the type of information received from customers. According to TMR, the BFSI segment is expected to exhibit a robust 27.3% CAGR in the 2016-2024 forecast period.
However, the healthcare sector is likely to play a major role in the development of the master data management market in the coming years. The use of electronic health records (EHR) has risen in the healthcare sector across the world, albeit with a wide variety of systems. Master data management has thus received increasing demand.
The differences among the various EHR systems can also cause significant issues in cases of mergers and acquisitions, where the data sets need to be standardized. This has generated a significant demand from the healthcare industry for viable master data management solutions.