Causes and Effects of Low Quality Material Master (MRO) Data

Data quality, or lack thereof, is a common challenge that companies face in today’s business environment. As manufacturing and asset-intensive organizations grow and evolve over time, so too does the volume of inventory and electronic data that is required to maintain operations. Whether growth occurs by natural progression, or via acquisitions and mergers, it adds a new degree of complexity to the already challenging master data management process. In addition, changing technology and outdated or unclear business processes are often a major contributor to the degrading state of a material master. The most common factors attributed to low data quality include:

• Unrestricted System Access
• Employee Turnover
• No Data Standards and/or Limited Compliance 
• Mergers and Acquisitions
• Multiple ERP/EAM/CMMS Platforms
• Multiple Sites/Plants (often operating autonomously of one another)
• Multiple Languages (across global regions)

As a result, master data progressively deteriorates, becoming less reliable and usable to the company when making critical business decisions. Some of the major data quality issues that companies face include:

• Spelling Mistakes
• Multiple Names and Codes for the Same Manufacturer
• Missing Manufacturer Names and Part Numbers
• Duplication
• Incomplete Descriptions
• Inaccurate Part Information
• Inconsistent Data Format and Naming Convention
• Incorrectly Classified Materials

With only inconsistent and unreliable data available, maintenance and procurement struggle to efficiently maintain operations, manage inventory, and source parts when needed. Some of the most costly inefficiencies and consequences of low data quality include:

• Unidentifiable Items
• Difficulty Searching and Locating Parts
• False Stock-outs
• Increased Spot Buys and Expedited Part Orders
• Excess Inventory Accumulation
• Limited Spend Visibility
• Unreliable Reporting
• Compromised ERP/EAM/CMMS Functionality 

Sadly, this is the case for many manufacturing and asset-intensive companies. The good news is that it can all be resolved through a data cleansing initiative and maintained by implementing a corporate data governance strategy. For more information or to request a no cost, no obligation data evaluation, contact info@imaltd.com.