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Data cataloguing challenges every asset-intensive company should…

Data catalogue is an organised collection of your data assets retrieved from different data sources. To understand this better, imagine you’re browsing through a nifty online catalogue of your favourite apparel store. It doesn’t just show a lengthy description of each clothing item which can be overwhelming and confusing. It assembles relevant attribute details like price, in-stock availability, measurements, and colour combinations into rows or columns for easy viewing, thus helping you in buying decisions.

Just like the online apparel catalogue, a data catalogue allows your professionals to find the right data asset in the list and examine the systematically-organised attributes so they can use the information in day-to-day job functions as well as for analysis and decision-making.

Now, let’s zoom into an important data asset for every asset-intensive organisation—direct and indirect materials.

Direct materials make up part of a finished product. In car manufacturing, windscreen wipers are direct materials as they’re fitted into cars, where cars are the finished product.

While indirect materials or MROs (maintenance, repair, and operations items) consist of components and consumables that contribute to the production of finished goods. Some examples are lubricants that oil the welding machine to weld cars, and nuts and bolts that hold the machinery together. Put simply, they don’t go into the finished product.

An organisation would have thousands of these materials, making them notoriously harder to track—let alone catalogue!

Let’s deep dive into major challenges faced by asset-intensive organisations in dealing with material cataloguing.

Large volume of free-text PO entries

Free-text purchasing refers to any purchase order (PO) line item for a material that bypasses structured catalogues and standard procurement procedures. The material description is manually filled out along with the mandatory master data fields in the requisition or PO. This becomes the norm in the absence of a structured governance process and becomes uncontrollable when high-criticality materials are needed to prevent imminent breakdowns.

Companies having a large volume of free-text POs would need to expend time and resources in categorising and cataloguing these items. They’d have to go through each free-text entry, parse the description, and populate it into suitable attribute fields.

Oftentimes, people spend more time describing and populating procurement-related data, neglecting maintenance-related data like lead time and inventory levels. So, the team in charge has to look for the missing details and fill them in to complete all the catalogue fields.

It’s no surprise companies dread this herculean task ahead of them.

Duplicate materials

Failure to have a process to record and track materials could lead to duplicates across multiple sites and plants. And free-text PO entries could make it worse. People could be purchasing and recording the same materials over and over again, albeit under different part numbers and suppliers. Without any form of governance and validations, the vicious cycle continues.

This is one big-ticket item that your cataloguing team will have to deal with. It’s a huge effort to sift through the material items, identify duplicates, rationalise which entries to keep, and deduplicate them.

But this endeavour goes a long way in reducing costs associated with the storage and upkeep of these duplicate materials.

Cross-team collaboration

While you may recognise that your cataloguing project needs to be driven by business people, it gets more interesting when the involvement of multiple business areas is required.

For materials, inputs from Procurement, Inventory, and Maintenance teams are needed as they have different facets of information to catalogue. Bringing them together is crucial so you can have a comprehensive catalogue that serves as the go-to place for people along the supply chain to work with and get value out of it.

Without a cohesive plan to identify and engage key personnel from various teams as well as get their time and commitment for this project, your cataloguing timeline and deliverables could be at stake.

Compliance with industry standards

There’s also the ultimate question of which material attributes to be catalogued. True, you may be in the business long enough to discern which fields are relevant for this purpose, but it’s worth aligning them with industry standards as well as adopting the naming conventions.

You should structure your catalogue according to standards like ECCMA (Electronic Commerce Code Management Associate), UNSPSC (United Nations Standard Products and Services Code), or ISO14224, depending on the industry you’re in. For example, ISO14224 is more suited for Oil and Gas companies.

With standardised and consistent naming conventions, you’re able to clearly describe your parts when communicating with people across your organisation as well as suppliers, hence avoiding confusion and misunderstanding.

Again, aligning with industry standards requires a lot of effort, which explains why companies prefer to come up with their own structure.

What’s the way forward

Despite all the challenges posed, the benefits of having a standardised material catalogue that your people can use far outweigh the cost, time, and resources involved.

First, you’ll need to have a master data management system that prescribes the foundational structure of your catalogue. This is followed by setting up rules to restrict the items that go in while adhering to the defined taxonomy such as parsing the attributes from available material descriptions, checking for duplicates, and assigning mandatory fields.

Another important consideration is establishing the data governance process for catalogue updates to ensure ongoing data quality. There’s no point in having a complete catalogue at the get-go, only to have the data accuracy and quality deteriorate in the long run. You can build workflows to assign personnel to review and approve materials’ creation and updates.

Leveraging cognitive intelligence for repetitive tasks like data remediation and enrichment of attributes can also save a lot of time and hassle.

And how do we exactly do this? Check out this blog to find out more!

Author: Shigim Yusof