Data cleansing projects are an incredibly important endeavor that more companies are taking on with the goal of increasing Material Master data quality and meeting maintenance efficiency and cost saving targets. While data cleansing certainly offers many immediate cost savings and efficiency gains, the most lucrative benefits are those that are generated afterwards by applying and maintaining cleansed data. In fact, it’s completely possible to miss out on the very cost savings you’re looking for if you don’t plan beyond the cleansing project!
In order to maximize your return on investment (ROI), you’ll want to consider the whole picture and what comes after the data cleansing project itself. Today we’re going to talk about what that means and what plans you need to make outside of the initial project.
If you want to get started, check out IMA’s data evaluation and instant ROI calculator, available on our website.
What does a data cleansing project involve and what are the benefits?
Data cleansing is the process of making all of your data consistent, accurate, and reliable. While this might sound simple (or not, depending on your familiarity with your Material Master data!), it can be a lengthy and time consuming process. First, you need to make sure that all of your data has been captured in the same source. Then, comes the actual cleaning of sometimes hundreds of thousands of items that have potentially been entered differently by different employees. (We talked recently about why you might choose an external data cleansing provider and the sheer amount of work is one of those reasons.)
This is all to say that data cleansing is not a project you tend to take on lightly. What makes it worth it, though, are the benefits. These include:
Improved part searchability
More accurate reporting
Elimination of false stock-outs
Reduction of downtime
These are all hugely beneficial results! But they’re not quite as beneficial if they don’t last after the initial data cleansing project ends. After all the time and resources you put into the cleansing initiative, don’t you want to ensure the results are long-lasting?
How do you maximize ROI?
As you take on a data cleansing project or start to wind down on one, you’ll want to prioritize these three actions:
Clearly define project objectives and requirements
Plan ahead and establish a long-term data governance strategy
Dedicate time and resources to perform post-cleanse implementation tasks
Clearly Define Project Objectives and Requirements
Defining clear and concise project objectives and requirements is one of the first steps to achieving sustainable long-term results and maximum return on investment. Project objectives and requirements should incorporate input from all departments who will be working with or affected by the data. For example, Maintenance and Procurement personnel both work with Material Master data on a daily basis, however, each department uses the data much differently. Therefore, the project requirements need to be established prior to cleansing in order to ensure that the final deliverable suits the needs of all end users.
In addition, defining achievable and measurable objectives prior to project commencement will allow you and your service provider to establish KPIs and become accountable for unmet targets.
Here are some questions to get you started:
What is our goal for the end of the project? For six months after? For a year after?
What is our timeline?
Who uses the Material Master data?
Who needs to be involved in the planning? Are we including every department that uses the data?
How will the changes we plan to make affect users?
Plan Ahead and Establish a Long-Term Data Governance Strategy
Data cleansing is not a “one-time, never-look-back” type of project. Although you may have taken the first major step to achieve maintenance efficiency and cost savings through the initial cleansing project, long-term data quality requires diligent ongoing maintenance.
Too often, companies are so focused on the initial data cleansing project and reaching their desired end state that they completely overlook the governance component that is required to maintain data quality after the cleanse. As a result, companies find themselves a) unable to implement a data governance strategy because they did not allocate the appropriate funds during project approval, b) struggling to govern data internally due to limited resources, expertise, and tools, c) back in the same inconsistent state all over again because they completely failed to maintain data standards.
For this reason, it is extremely important to establish and incorporate a long-term data governance strategy as part of the initial project plan, budget, and approval. By doing so you will not only protect your initial data cleansing investment, you will also maximize long-term ROI by ensuring ongoing data integrity and sustainable efficiency.
But what does it mean to implement a data governance strategy? Governance is the act of validating that any additions to the Material Master data set after the cleansing initiative are accurate and not duplicative. This can be done with more efficient data entry, better workflows, and approval processes. How exactly you implement it depends on your organization and the resources you decide to apply to the task.
Consider the following as you take this step into planning your governance strategy:
Dedicate Time and Resources to Perform Post-Cleanse Implementation Tasks
Many companies unintentionally fail to allocate the necessary time, resources, and expertise to implement the results of a data cleansing initiative. In part, it’s because there are more tasks than you’d think! Even once you have your clean data, you need to:
Eliminate or consolidate duplicate records
Identify and dispose of excess/obsolete inventory
Physically identify “review items”
Enforce user compliance
Analyze and leverage spend
Establish preferred vendor programs
These are all tasks that must be completed to achieve maximum efficiency and return on your data cleansing investment. If you don’t have the time, resources, or expertise to perform these post-cleanse tasks internally, you may want to consider working with a third party service provider to do so.
If that sounds pricey, on top of the costs of a data cleansing initiative, consider this: in many cases, a successful inventory optimization and spend analysis initiative will generate enough cash flow to cover the cost of data cleansing several times over.
What can IMA do for you?
IMA not only specializes in Material Master data cleansing, we also offer complete project support through data collection and data governance services. We use our years of experience and one-of-a-kind tools to guide you through the entire process and maintain your data for maximum ROI in the end. You can learn more about our services on our Information page.
If you’re not sure what we can do for your organization, start with a free data evaluation and instant ROI calculation! You can find both complimentary tools on our website.
Conclusion
Data cleansing is the foundation for maintenance cost savings and efficiency, however, there are many more pieces to the complex MRO spend reduction puzzle. At the end of the day the best advice is to plan carefully, establish an internal project team that can represent the entire organization’s needs, and select a service provider who is able to provide best-practice recommendations and solution support throughout the entire process. Otherwise, you’ll only be capturing the low hanging fruit through your data cleansing initiative and left questioning why your project didn’t deliver the ROI you had originally projected.
Comments