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(If you prefer listening to reading, you can also watch this video where I cover the content of this post in an online session.)
I recently outlined our plans for the SAP Master Data Governance (MDG) solution portfolio at Sapphire, Orlando.
The MDG roadmap session was fully packed at Sapphire and our plans resonated well with the audience. In fact, at the beginning of the session there was still a big crowd of people standing outside the room waiting for entry, but as the room was already completely full they could unfortunately not attend for security reasons.
I would like to apologize for the fact that some of you were not let in. And to make up for this at least a bit, I'd like to share the news with you in the SAP Community. (The slides below are actually the ones that I used in that Sapphire roadmap session.)
Please note that the roadmap disclaimer indicating that future items are subject to change applies.
Solution Introduction
To get started, let me very briefly explain what SAP Master Data Governance (MDG) is, and which topics it addresses.
MDG is an application to manage master data, it provides preconfigured, domain-specific master data governance to monitor, find and correct data quality issues. You can either centrally create, change, and distribute, or you can consolidate master data coming from different systems in your complete enterprise landscape.
SAP MDG is one application for all master data. It is not only for SAP master data. It does come with a lot of out-of-the-box, domain-specific capabilities that are, of course, based on SAP’s data models and business logic. But it is also a platform that is used by many customers to build master data governance processes on extended data models and completely custom-defined master data domains.
From our customers, we understand that the purpose of master data management is really to improve the quality of master data and to get a corporate-wide understanding of master data, so that they can run and optimize their business on top of it.
As you might know, companies are taking different approaches to MDM. For example, some allow for de-central ownership of master data, and create a common understanding by using master data consolidation to create key mapping between detected duplicates and to create a golden record. Others prefer central ownership of master data and distribute master data that is always created in high quality. Some companies decide to take a de-central approach for some domains – like customer master data, for example – and a central approach for other domains – like when introducing new products, for example. And on top of that, many companies constantly monitor how the quality of master data evolves. And then they react, if they find issues.
SAP MDG supports all these approaches and also all combinations of these approaches in a very integrated and organized way, and this is very much appreciated by our customers. This allows you to combine approaches as required to cover all use cases and all implementation styles, for a complete enterprise master data management program with just one solution: SAP MDG.
Strategy and Vision
Our strategy and vision for MDG is very consistent over the last years. And we are very successfully executing along this vision. And you will also see that it is not an isolated strategy just for MDG. Our MDG product strategy is embedded into SAP’s broader business solutions strategy as well as the SAP BTP strategy.
Our roadmap for MDG is driven by – our core beliefs – and by trends that we see in the market. We believe, SAP can provide much more value to our customers than just any MDM tool provider, because we understand how master data is used in business context. We create benefits for our customers leveraging this understanding. We can provide master data management capabilities that truly support all domains, all industries, and all approaches, embedded into the business. We have proven this with SAP MDG, and we will continue to deliver on this unique promise.
In addition, we see certain trends in the market. And I will talk about these trends in more detail on the next slides. On this slide, I just want to highlight how interrelated these trends are.
For example, new sources for trusted data in the cloud, or data sharing in business networks in the cloud, will allow for more automation in keeping your master data records up to date.
Or take the fact that Digitization demands for higher volumes and better quality of master data, and hence needs more automation in master data management.
As we all know, the market for business application software is moving towards modular applications and towards the cloud. For most companies, this move to the cloud is not one single step. And to allow for a step-by-step journey, modularization is a key enabler, that allows to move also MDM capabilities to the cloud step-by-step, as required by the applications.
Let’s come to the first trend: Cloud. When business applications are moving to the cloud, the master data itself needs to be provided there. And this is of course possible with MDG today. But in addition, we will continue to provide cloud-based master data integration services on the SAP Business Technology Platform. And we will build out data quality services as microservices in the cloud. Like today we are offering Address-Validation-as-a-Service against always up-to-date address directories, in the cloud.
I already mentioned that a stepwise move of business applications to the cloud demands for a modular approach to MDM. We are addressing this need with federation of MDG. This will by the way also help to meet the increasingly local compliance regulations.
Modularization and cloud consumption will also enable our customers to get to a positive return on investment much faster and to grow their enterprise MDM program exactly in the pace needed for their strategic business initiatives.
I think we all agree that master data is the key resource of any digital transformation. We will enhance MDG to help companies to become more intelligent, more agile, and to always process data compliantly.
Digitization will demand for modular, specialized business applications and we will help to provide harmonized, high-quality master data to these applications to enable end-to-end processes for Intelligent Enterprises. The key drivers that we are focusing on in MDG are automation enablement, efficiency, and master data quality management.
In the modular application landscape of the future, it will be a challenge to provide frictionless digital processes. SAP’s Business Technology Platform will be the foundation to achieve this. SAP One Domain Model as the common language and SAP Master Data Integration for SAP and non-SAP integration will enable this.
And this will provide our customers with a very high return on their investment into master data quality, because BTP’s common data foundation will allow to then broadly apply artificial intelligence as well as analytical scenarios to all data, and this is then powered by high quality master data provided by SAP MDG. This means that every investment that you put into improved master data with MDG, will pay back significantly in all your data-driven scenarios on top of BTP.
We actually also see clear proof of this interrelation of digitization and investments into master data management, as many of the current SAP S/4HANA transformation programs at our customers are using SAP MDG to prepare this fundamental move for their company.
As discussed, digitization is one of the key drivers for automation in MDM. We will leverage SAP’s deep knowledge in business applications, analytics, and business networks, to reduce the need for manual tasks in achieving high master data quality.
We are leveraging third-party data providers to drive automation in master data creation. We are providing ways to predict master data attribute values from application context, and we plan to continue to use more artificial intelligence to support master data quality tasks. This will help to reduce the human effort in MDM and will help to avoid errors created by humans, and to avoid the effort it takes to correct these human errors.
This kind of automation will need an agile, rapidly-scaling MDM solution, that can be extended fast, scales quickly, and easily integrates with new systems, new business processes and new data types. We think, on the long run a modular approach to MDM will be more effective to meet this agility, more effective than a monolithic approach.
Let’s now focus on Federation. I have pointed out earlier how a more modular application landscape requires a modular approach to MDM and what other benefits in agility, speed, efficiency, and TCO we expect from that approach. Therefore, we provide this additional deployment option for MDG.
This can be an option for companies that plan to balance central and decentral MDG processes instead of using a fully centrally managed MDG approach.
This can for example be an alternative for very heterogeneous companies running very differently set up business processes and application systems in their landscape, and for example also multiple differently configured SAP S/4HANA systems.
We believe in providing choices and non-disruptive journeys for our customers. That is why this additional deployment option is not only for new customers but can also be used by existing customers by adding to their current implementation and safeguarding their investments into SAP MDG.
As of today, most companies are using one single MDG system to centrally-manage the master data for the complete enterprise. And everybody can of course continue to do so. But for some companies, one single monolithic MDM system for the complete company already today provides some challenges. And as we discussed, this will even increase in the future.
The new approach with a federated MDG landscape will allow these companies to go for a more modular approach. They can for example get their MDM journey started at very low initial investment by just subscribing to a highly standardized Software-as-a-Service solution just for core master data attributes. And then in the future they can grow into a platform approach. Or they can federate out to more application-specific deployments of MDG.
We believe that we will provide companies with a faster time to value, with increased flexibility that enables a broader MDM scope, and with a lower Total-Cost-of-Ownership.
Federation allows companies to execute master data management as central as possible, but also as local as needed by the diverse parts of the organization. They can really govern the data at the place where it is best understood. For more details, you may want to read the blog post about the benefits of federation.
SAP offers choices how to consume SAP Master Data Governance across the cloud and on premise. Companies can hence decide for their deployment approach of choice.
On the left-hand side, you see SAP MDG on SAP S/4HANA, private cloud edition – which can also be deployed on premise. This version is typically used for multi-domain, centralized governance across complete enterprises. It has pre-delivered business content across various domains (for example, business partner, customer, supplier, material, financial data), and there are solution extensions from SAP Partners. This version comes with a very flexible framework to extend processes or create custom master data objects that even meet the very complex needs of the largest enterprises.
In the middle, there is SAP MDG on the public cloud version of SAP S/4HANA. This is typically for organizations who are focused on consumption in the public cloud, and who are running SAP S/4HANA in the public cloud. This version is currently focuses on business partner, customer, supplier, and product data. It is easy to consume and provides the processes for the very broad underlying S/4HANA data model.
And then, SAP Master Data Governance, cloud edition – on the right-hand side – is a software-as-a-service kick-start solution for the governance of core Business Partner data.
We will continue to enhance all three versions of MDG. As you can read on the bottom of the page, the strategy is that all versions of MDG will have the same broad coverage of master data management processes across central governance, consolidation, data quality management and so on.
The two differences are: first, in the data model – which is either the very broad data model provided by SAP S/4HANA, or it is the core data model of SAP Business Technology Platform. And the second difference is on the way how you can consume MDG, from a very easy to consume SaaS solution in the public cloud (on the right-hand side) to a robust private platform that supports even the most demanding customizations of the largest companies of the world (on the left side).
Recent and Planned Innovations
I would now like to focus on some recent and planned innovations, and explain how these relate to our product strategy. You might have already noticed this little graphic on the top right side. This always highlights, which part of our strategy is addressed by which innovation.
The first recent innovation that I would like to cover is about federation and modularization.
What we have recently enabled is that you can use the 2023 version of SAP MDG on SAP S/4HANA as the core data owner in a federated MDG landscape. And you can also use this version of MDG as Application Data Owner in federated MDG.
The benefits that we generate with this new innovation are of course the benefits that we communicated for federated MDG: you can build an enterprise-wide approach to master data management that allows for de-central freedom to manage the data where it is best understood – in the context of de-central applications. But nonetheless you get all the advantages of a centralized approach to master data management.
How do you set up such a federated MDG? You switch on MDG capabilities on all relevant systems. Then you define the ownership in one central place. You pick the one system that is your core data owner, and you define which application data owner is responsible for which part of the data.
And that’s it. After you have set this up, based on the process templates you choose in each system, MDG will orchestrate the processes across the various data owners, so that every system manages the part of the data that it owns.
The next innovation that I'd like to focus on is a key enabler of multiple topics on our roadmap. Hence the broad reference to our strategy in the top right corner.
In Q4 2023, we have provided the so called “cloud-ready mode” in MDG. This is an additional option how to use the master data governance processes like central governance, mass processing, consolidation and data quality management.
We leverage SAP’s next-generation development model for cloud-ready and enterprise-grade applications, which is referred to as “ABAP Cloud”. This is a very modern software architecture that uses FIORI as the UI technology, SAP HANA and Core Data Services for the data model, and cloud-optimized ABAP language for the business logic.
One key benefit for our customers is that this helps to implement a “clean core” strategy in order to make their enterprise-scale implementation upgrade-safe and ready for the cloud. Another aspect is that we plan to offer that same modern architecture across all versions of MDG across on premise and cloud. For example, if a company is using multiple deployments of MDG in a federated landscape in the future, they can leverage extensions that they have made in one deployment approach, then also in their other MDG instances. Or they can continue to use extensions in case they transition MDG capabilities from on premise to the cloud.
This cloud-ready mode architecture is the foundation for innovations such as federated master data governance with MDG on S/4HANA as a core data owner, which I just talked about. And this improved architecture also allows us to introduce new capabilities in MDG, like flawlessly integrating trusted data from external providers directly into the user interfaces and the processes of the end-users, which you see as a screenshot on the right-hand side. I will actually come back to data provider integration on a later slide.
But for now let's concentrate on cloud-ready mode.
As said, we introduced the cloud-ready mode in MDG on S/4HANA 2023. We allow our customers to switch on the cloud-ready mode per domain, if they like to. The current focus is on the Business Partner domain. On the right-hand side, you see a screenshot how this looks like in the SAP Customizing IMG.
This switch will convert all processes based on the Consolidation and Mass Processing framework to the new architecture and allows to do single processing also on that framework. And in parallel, you can still use central governance in classic mode in parallel, if you prefer.
After switching it on, the modern architecture allows for a very consistent process design and very consistent user interfaces across all MDG processes – everything in SAP Fiori. And it allows for true end-to-end automation of processes. For example, at every step in all relevant processes, customers can branch out into a workflow to involve the right experts or to bring in automation like automatic validation and approval, or like enrichment via automatic population of attributes. And there is flawless navigation for users between mass processes and maintenance of single records within the mass processes.
And this modern architecture also allows for seamless integration of new capabilities, like data provider integration, federation, or also graphical visualization of running MDG processes – even across systems.
More information regarding cloud-ready mode in SAP MDG can be found in this blog post.
Data provider integration is another recent innovation that we brought to market in 2023. It is about automation with the help of trusted external data. We had provided first scenarios in our product version SAP MDG, cloud edition. And now with the 2023 version it is also available to our customers in the version of SAP MDG on SAP S/4HANA. We offer creation and enrichment of business partner data based on reference data from our partner Corporate Data Quality, who has access to more than 70 sources of trusted business partner data around the globe.
As pointed out before, the target is to help our customers increase the automation in master data management. You should be able to leverage high quality data that is provided by trusted sources or that you share with other companies in a community approach. As of today, we offer creation and enrichment of single records. In the future, we also want to enable mass scenarios with automatic updates of changes coming from the data providers. We also want to provide out-of-the box connectivity to other providers like Dun & Bradstreet and to enable companies to connect their own data provider of choice.
Let me also share information about some planned innovations for the near future. The first set of innovations is about artificial intelligence.
As you might know, we already use AI in MDG for data quality rule mining. The system can investigate your current master data attribute sets and can propose potential new data quality rules that you might want to also put into your rule repository and that you might want to enforce wherever data enters your system.
But this slide here is not about the existing Business Rule Mining. This is about two new scenarios that we plan to provide with the Feature Pack Stack 2 for MDG on S/4HANA 2023 later this year.
On the left-hand side you will see the two scenarios highlighted in orange: The first one is called “Summarize Changes”. This feature will help you in change request processing to get an overview of unsaved and saved changes in natural language (of course using a Large Language Model). This feature can for example help people who intend to do master data changes. They can check in a natural language summary whether they have changed everything they intended to. Or also for people who are approving master data changes by others: they get a natural language explanation of the requested changes.
The second scenario is called “Assisted Change”. The idea here is to allow to change master data attributes with as little effort as possible, so that applying changes to a master data object is time efficient. Here, a user can make prompts in natural language to do attribute changes. For example, for people who are
less trained or less experienced in master data management, this means that they can have an easier way to communicate the intended change to the system and they are then guided towards the right attributes in the data model that reflect their intended change.
The last planned innovation, that I'd like to highlight today is business partner hierarchy management. The target here is an application-agnostic legal business partner hierarchy. But don’t get this wrong: this is not only about manual maintenance of a hierarchy. This also about automation of this process.
The idea is that you can use data sources like external data provides to retrieve legal hierarchies (like a Dun & Bradstreet family tree) and that MDG can load that data and solve conflicts, for example if there are incompatible changes.
Of course, there is also manual maintenance and processes to ensure the governance of the hierarchy changes, but we also plan for automatic derivation of your own representation of a legal hierarchy based on the external data, and you should also be able to consolidate changes coming for example from file uploads or other sources.
And then we plan for replication of the hierarchy information using SAP Master Data Integration services on BTP, so that applications can consume these hierarchies. And SAP is of course also planning to provide the consumption of these hierarchies in various applications as part of the roadmap for these applications.
We have just recently provided the initial version of this capability in SAP MDG cloud edition (with Release 2405), we plan to also provide this in MDG on S/4HANA (most probably in the year 2025, and we plan to further expand this capability as outlined above.
Finally, here is an overview of all the innovations that we plan over the next few years. All this information is also available via the SAP Roadmap Explorer.
This slide reads from left to right, starting with recent innovations on the left-hand side and then the planned innovations along the years 2024, 2025 and 2026.
I know that this is perhaps a little bit of an eye chart, and I would anyways recommend that you take a detailed look at the Roadmap Explorer. For now, I have highlighted some of the most important planned innovations in a larger font:
This year we plan to provide the legal business partner hierarchy that I just mentioned. And we are actually working on integrated processes for end-to-end supplier management across SAP MDG and the Ariba portfolio. By this we plan to integrate governance and approvals as well as automation and 3rd party integration directly into Ariba’s processes for purchasers and business users.
In the years 2025 and 2026, we plan to enable all relevant MDG processes for business partner data on SAP S/4HANA cloud, public edition. This includes the option to use S/4HANA public cloud as an application data owner in a network of federated MDGs. So far, we have offered that option for S/4HANA on premise and private cloud.
In addition, we intend to focus a lot on the product domain, this includes the cloud-ready mode architecture across all versions of MDG as well as federation for the product domain.
And in parallel, we are working on further platform capabilities, like providing SAP MDG, cloud edition on BTP also as Platform-as-a-Service (today it is offered as Software-as-a-Service) and providing the cloud-ready mode option also for custom-defined objects.
And then there are all the other planned innovation that you saw on the slide before that you can investigate in detail in the SAP Roadmap Explorer online.
To summarize, SAP Master Data Governance is the one solution for your entire enterprise master data management program. It is an application that provides preconfigured, domain-specific master data governance. At the same time, it is an open platform to extend and build, in order to manage your own master data domains for all SAP and non-SAP landscapes.
And SAP MDG is also a key enabler that will help you get ready for your future business transformations. Many things are already available today, but we also discussed all the innovations on our roadmap for MDG that follow our main themes of automation, and federation to enable our customers’ digital transformation and their path to the cloud.
Our roadmap for SAP MDG will focus on unlocking these additional benefits for our customers, while maintaining our core belief that SAP can do more than just provide a toolbox for master data management.
To stay on track with what's going on in SAP MDG, simply follow the SAP Community Topic Page for SAP Master Data Governance and join the Q&A and discussion forum.
Best,
Markus
