4 Facts That Makes Reference Data Special

If you do not have much experience in managing master data, it is advisable not to underestimate the simplicity of its structure. It should be treated differently from other data because it has its own management needs. Here are some details explaining the value of data:

It presents values with definitions or meanings

An essential contribution of baseline data is that it presents actual values that include definitions or meaning. The complexity of these definitions can be comparable to the complexity of entity and attribute definitions.

There are data types that may contain different values but with similar definitions. For example, a bank may have several thousand accounts with different account numbers and although each account number is unique, the bank may have provided a single definition or meaning for all of them.

Since this data allows the meaning or definitions to follow its values, these values are then able to control the logic of the program. This is also the reason why this data is often linked to a company’s guidelines. Thus, in order to have a sound business guideline, it is essential to learn how to effectively manage master data.

It does not show the parties with whom a certain institution deals.

Some reference data requires details of the parties or things a company deals with, but it does not display them. The purpose of requesting details is that they are needed in the database in order to categorize other data that can best describe that company’s transactions.

Its values are not prepared within a company.

A unique attribute of this data is that its values are generally not created within the company. For example, there are country code groups managed by the United Nations. For this reason, a company does not need to develop its own data values for a certain data table.

Highly exploited in all databases

A major attribute of this data is the fact that it is commonly used throughout the database, in one organization’s databases as well as in the databases of several organizations. A currency table can be associated with other tables containing financial amounts in the database. This association is useful in that it determines the financial amount of the currency which can then lead to an understanding of the currency scale.

The benefits of effectively managing master data have led many companies to focus on learning about their particular management needs. Don’t be fooled by the simplicity of its structure and don’t treat it in the same way as other types of data. Knowing its uniqueness or diversity is a very essential step in the management process.