Large organisations typically have multiple masterdata silos, each containing core business hierarchies. Each silo addresses an individual business need and tends to be controlled by separate individuals within the organisation. For example, there will be separate teams responsible for the general ledger, budgeting systems, reporting systems and consolidation systems. Indeed the challenge is often greater than this, with different divisions of the organisation maintaining completely independent Chart of Accounts (CoA).
The relationship between these applications and teams is often hierarchical, with those higher in the organisation forcing change to those lower down. This can be termed a master-slave relationship and results in significant problems for any organisation. Changes to the master system drives reactive change to slave systems and changes to the slave systems jeopardises the integrity of the numbers reported. The result is a manual and inefficient process with all changes requiring significant testing prior to implementation.
Organisations can solve this problem in a number of ways. The larger service providers would advocate a change and conversion program to the underlying ERP and EPM solutions. This approach is often unwieldy, lengthy and requires significant change management. More importantly it is incredibly costly. If the main objective of your organisation is to standardise financial reporting, not to align business processes and technology, then a far more effective and cheaper approach is to implement a governance and change management process that aligns reference data between the various silos. These governance solutions enforce business rules, run pre-emptive checks against related data and will highlight the impact of a change on all systems.
Oracle Hyperion Data Relationship Manager (DRM) is a very powerful masterdata management tool that can be used for this purpose and Oracle Hyperion DRM allows organisation to centralise and standardise their masterdata into a single location.