Effective Master Data Management Starts With UNSPSC Classification
If you are working in a large automobile manufacturing company, you are well versed with the fact that your company has to deal with many spare parts on a daily basis, in order to ensure smooth production and timely delivery of all its vehicles. Being a target-based business, the company also has to manufacture a designated amount of vehicles per day, and hence, requires all its parts to be available at hand. Therefore, in case of an emergency call back of dispatched vehicles for maintenance, if a single concerned part cannot be located immediately on its system, it can result in severe losses for the company and also invites negative reaction from the target audience. Such a situation generally occurs when the business does not have the right MDM tools at hand. Moreover, businesses are also hesitant to introduce any new classification model, because they are unaware if the new system would actually benefit them. This is when they look out for a tried-and-tested classification system, which is not only accepted globally but is also very effective. At such times, the only proven classification system that comes to mind is UNSPSC classification.
UNSPSC classification, also known globally as the 'United Nations Standard Products and Services Code' is available to the public and is free to use. Moreover, the system does not have any copyright restrictions whatsoever. Being an international commercial standard, the classification allows businesses to maintain a well-defined framework, while they classify their products, finished goods and other services. The coding and segregation system was introduced globally in order to ensure a proper streamlined structure, while classifying products and services. This structure will also guarantee that the products comply with industry naming standards, for better sorting and accessibility across the enterprise. Being hierarchical in nature, UNSPSC classification structure paves the way for effective spend analysis, with provisions for rolling up and drilling down. This also benefits long-term data initiatives such as material master data management and data quality improvement.
With the help of proper UNSPSC classification, businesses can experience newer and improved forms of product categorization and discovery, with the help of proper:
Resource Discovery-
The company can now identify the location and stock part availability of regular suppliers. This also helps them find the presence or absence of certain required products or services, with the help of their MDM tools and systems.
Spend Analysis-
On adopting UNSPSC classification, the business will be equipped with a 360-degree view of all the spend occurring across the company as a whole. Thus, they will be able to analyse and rectify errors and excess expenses, eventually helping them to capitalize on data quality management.
Product Segregation-
With UNSPSC classification, you will be able to classify all the similar products and services into one unique bracket for ease of access and availability.
Jessica Banks is a recognised author and editor at a renowned data management company. Her articles are read by many well-known master data management vendors.
