From its origins as a development project to centralise the company’s master data, within 3 years Lemminkäinen’s MDM solution has become an essential tool for daily use. MDM is used in a fully integrated manner to open new customers, suppliers, projects, internal orders and establishing ledger accounts for businesses, which function with seasonal changes in operation. For example, once the snow melts Lemminkäinen’s road surfacing business restarts and more customer accounts are opened. This increases the need to open all master data.
Sami Immonen served as Lemminkäinen’s project manager for their MDM implementation project and nowadays is ICT purchasing’s procurement manager and a daily user of MDM.
When the project began Immonen calculated the business case and how much of a system administrator’s working day was used up creating the same information in dozens of different systems. The conclusion from this calculation was that MDM brought significant savings in time, a fact proven in practice. Manual IT work has been greatly reduced when working hours are not wasted maintaining master data. In addition, master data is up to date, more complete and of higher quality, which all increases the information value.
“Nowadays all my purchasing category’s supplier information is managed via MDM. One of the great advantages of MDM is that you are able to use a considerably smaller number of attributes for the creation of a supplier or customer as if it was created in SAP. Normally in SAP this would require the completion of dozens of entry fields. This way we save a huge amount of time.”
“Also, supplier activity data can be changed in MDM through a single selection box, whereas in SAP this would require the selecting of four or five separate boxes. The scenarios created in MDM are smart and should be utilized more often.”
Greater transparency to the master data opening and modification process
System Specialist Sirpa Karjalainen worked as part of the MDM implementation project, and she has supported the MDM system in operation ever since. She is responsible for support, system configuration and testing, together with system administrators. The users are highly independent, but support is needed for instance when customers or suppliers are expanded to other companies.
System administrators in Lemminkäinen number just two dozen, and they are divided largely by process. MDM’s user report indicates that those with active user rights access number 60.
Through MDM it is possible to establish customers, suppliers, ledger accounts, cost centres, profit centres, projects and internal orders. Of these, customers, suppliers, ledger accounts, projects and internal orders are fully integrated meaning that all master data is opened and modified in the MDM solution, which then transmits the data to the target systems.
“Every set of master data has its own process approval group. MDM increases the transparency of the opening and modification process for master data through workflows. These workflows allow the approval process for master data to be monitored in real time and, if necessary, make use of the statistics retrospectively,” Karjalainen explains.
“In addition, in the background MDM supports the amalgamation and gradual dismantling of the old operational systems by means of layered integration of technology,” Karjalainen continues.
MDM is up and running and facilitating daily activity
At the start of the development project , as it is typical, there were some challenges. Lemminkäinen’s model database including hundreds of thousands of data rows and rules was a complex starting point. Together with the supplier the challenges were solved.
At present MDM is running by itself, the system has been stable and virtually trouble-free. Operation has merged to become a part of normal daily routine.
“When you hear in the hallways that the information has been set up in MDM, it always gets a thumbs up from me. It’s nice to hear that MDM has become just another tool amongst the rest. Support often focuses on things that do not work or that could be fine-tuned, but you have to remember that MDM is used all the time,” states Karjalainen.
MDM is connected to external data sources, such as the BIS and the credit control information, which update customers and supplier’s real-time creditworthiness, as well as the prepayment register, to MDM.
At the end of February the big annual update takes place when the tax authorities publish the suppliers in the prepayment register using their business IDs. The data comprises 25,000 rows. The mass of data is run into MDM and then the information is downloaded to the appropriate target systems. MDM enables the updating of this information into a centralized supplier register.
MDM at the core of operational changes
During MDM’s three years of existence it has been involved in major operational changes. In expanding the financial control solution the user interface language was changed from Finnish into English, and Swedish company data was migrated from Swedish companies to MDM. Lemminkäinen’s divestments have reduced the maintenance of the master data, but system investments are still desirable to ensure greater benefits – the same applies to MDM.
“In general when talking about MDM a lot of focus is on administrative models, data stewardship and the master data manager. After all, it is good that people understand the data expression, but in my opinion we should think more about MDM’s business potential in economic terms by streamlining processes and reducing manual work. This would require an evangelist, who would take responsibility for comprehensive development,” Immonen believes.
It is hoped that with the deployment of MDM’s next version business scenario guided logic and user interface will be utilized.
Immonen and Karjalainen have innovative ideas on how information could partially stem from its source into subsequent processes automatically and digitally. For example, prospect targets for tenders could be created in MDM as soon as the tender is drafted and then activated as projects/orders upon completion of the sale. The drafting of tenders requires a lot of master data that doesn’t change.
Another idea would be to build a supplier portal where suppliers could register, present basic information about themselves as well as approve Lemminkäinen’s business policies and payment terms. Procurement Managers could monitor and activate the prospective suppliers through the portal. Information would be automatically transferred to the MDM system and beyond. Automating certain steps would save hours of work.
Lemminkäinen’s MDM partner is the specialist data management company, Ineo.