When you’re trying to understand something, it’s natural to put that thing in a box or come up with classifications for data management. We do this all the time in our daily life. If you meet someone who likes the same movies and TV shows as you, you put them in a box. If you meet someone who acts rude and unkind, they go into a different box. Well, in business and software, there are similar boxes.
Throughout the entire business process, you get different datasets of customer data, sales totals, employee inquiries, and more. This is considered your master data. In Master Data Management (MDM), you organized that information and make sure everything is processed accurately and cohesively. To organize your master data in the best way, you need different hierarchies. This is where reference data shines. Reference Data Management (RDM) is all about managing classifications across company and system lines.
In this outline, we’re going to discuss more about reference data and how these functions can improve your overall business in meaningful ways. After all, if you plan to put your data into boxes, you need stipulations for what those boxes are.
What is reference data?
Simply put, reference data is a subset of master data that helps you classify data throughout your entire business process. Think of this as hierarchy management. Reference data is always the same—no nuance or ambiguity. Your reference data management tools may involve internal systems or external ones and the relationships can be one-on-one, one-on-many, or hierarchies. You’ll see reference data used throughout the Internet of Things to help stream metadata and make big ideas seem cohesive and connected. Throughout your business intelligence, you’ll need these reference data sets to help you understand your master data and workflow in more effective ways.
What is reference data management?
Reference Data Management (RDM) is the function of controlling and understanding these reference data sets. Everything from performance analytics to distribution to tracking changes is considered an RDM solution. These RDM tools set up your hierarchies and help give you some control over your key business processes. Each version of reference data is going to look a little different. This may include code lists or data models. Some of the most recognizable examples of RDM are country codes or area codes. Use these RDM systems to connect your reference data, and in turn your master data, in more effective ways.
Types of RDM Tools and Areas
Different businesses and industries will use reference data in different ways. Multi-domain reference data is the form that doesn’t have a specific industry. This spans multiple areas from finances to human resources and will use plenty of different content types. Capital markets like brokers and asset managers may prefer real-time reference data.
Overall, the tools are there to help you integrate your data management software whether you’re a large enterprise or a small business. With the right set of tools and artificial intelligence, your code tables and RDM will help you keep your data warehouse organized and efficient.
Benefits of RDM
There are plenty of notable benefits to utilizing RDM. First, it helps you control and understand any issues in governance or customization. By using RDM, you can actually set up your own management tools and identifiers that will make your workflow completely specific to your company.
You’re also centralizing all your data. Allow different team members and partners full access control to the customer and transactional data. Rather than waiting around for answers or struggling to find the data you need, these reference data changes will make life easier for all your employees and constituencies.