• Orchestra Networks

Interview: The Information Difference's Andy Hayler Highlights Findings from the 2015 MDM Landscape

In July, the Information Difference updated its MDM Landscape for 2015. The MDM Landscape is their annual industry snapshot highlighting the leading master data management solutions and current market conditions. Despite everyone's busy summer schedules, we were lucky to catch up with Andy Hayler, the CEO of the Information Difference, and get his viewpoint on the 2015 MDM landscape.

1. What can you tell us about the state of the market for MDM?

Looking at the market for enterprise software, master data management (MDM) is still one of the fastest growing segments. The information difference estimates that the MDM market is worth $1.2 billion. We also estimate that software license revenue for MDM software was $660 million, maintenance revenue at $205 million and MDM professional services revenue of the software vendors at $335 million. Our research shows that on average the people costs of a MDM project are four times that of the software license cost. Keep in mind that that's an average number. We have found that some solutions require enormous services teams whilst others do not. Also we have seen that some solutions necessitate hiring consultants during implementation while others can be implemented with in-house staff, depending on your skill levels. Given the large potential cost exposure it's well worth asking your potential vendors about this typical project experience, staffing requirements and change management.

2. Can you describe how the MDM landscape works?

The landscape diagram represents the market in three dimensions: customer base, technology score and market strength. The size of the bubble represents the customer base of the vendor. The technology score is made up of a weighted set of scores derived from: customer satisfaction as measured by a survey of reference customers, its maturity in the market and the breadth of the technology in terms of its coverage against our functionality model. Market strength is made up of a weighted set of scores derived from: MDM revenue, growth, financial strength, size of partner ecosystem, (revenue adjusted) customer base and geographic coverage.

3. Which is the most important dimension?

Each dimension's relative importance will depend on your organization. For example, some organizations seek out usable, leading-edge solutions. These organizations tend to focus on our technological dimension. They use our relative technology rankings to understand the breadth of each solution, the usability of that technology and the direction of the vendor. As a side point, usability should be a big factor when assessing technology. That's why we have always assessed customer satisfaction when evaluating vendors along the technology dimension. Satisfied customers are a solid proxy for the organizations that are using MDM effectively and deriving the biggest benefits from their investments. After all, no-one is better positioned to assess a technology than customers who have implemented it in practice. Other buyers hone in on financial strength and that's why we include it in the market dimension. While it's important to be concerned about the viability of your vendor, keep in mind that financial strength is no guarantee that an organization will continue to commit resources to the MDM market. We have seen multiple vendors--especially organizations that pursue multiple markets--shift focus and reduce their commitment to MDM. And complicating the issue is that for vendors with multiple MDM technologies, commitment to the MDM market may not equal commitment to your specific MDM platform. Finally, for that group of buyers that find safety in numbers. we have the customer base dimension. I would urge everyone to keep in mind that a large base of customers is not always the key thing especially if you do not share much in common with your chosen vendor's customers. Some MDM platforms, especially those that are delivered with pre-built models, are often "tuned" for a specific use case, business model or industry -- and if your organization doesn't match this then substantial amounts of re-work may be required. The fact is that each organization will have different points of view about the relative importance of each dimension. This is why we offer the MDM Select Service. MDM Select allows your organization to create a custom landscape by altering the relative weightings found in each dimension, based on your specific requirements and how important each are to you.

4. Can you tell me a bit more about your MDM select program?

Certainly, the Information Difference MDM Select Methodology evaluates MDM solutions across 200+ functional checkpoints that are relevant to MDM technology buyers. Prospective buyers rank the importance of MDM features to them and MDM Select then produces a listing of vendors that meets those requirements most precisely, based on weighted scorings of the vendor products against the customer's own requirements.

5. If my organization is interested in using MDM Select, what do we do? And are there any other services that the Information Difference provides that might help prospective MDM buyers?

Sure, more information about MDM Select can be found on our website here (http://informationdifference.com/products/mdm-select/index.html). Also, we can be contacted here (http://informationdifference.com/contacts/contact/index.php).

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