The main difference between master data and reference data is that master data is the data shared by multiple systems, applications, and processes in an organization while reference data is a type of master data that is used by other data fields.
Generally, master data and reference data are two types of data. The master data can include reference data or some other type of data that organizations agree to share. Business critical data, such as customer data and product records are some examples of master data. Another example of master data is analytical data such as market feeds.
Key Areas Covered
1. What is Master Data
– Definition, Functionality
2. What is Reference Data
– Definition, Functionality
3. Difference Between Master Data and Reference Data
– Comparison of Key Differences
Key Terms
Data, Master Data, Reference Data
What is Master Data
Master data refers to the data shared across an organization. There are various types of master data. For example, an enterprise around the globe uses enterprise master data, whereas marketplaces around the globe depend on market master data. In addition to the above, reference data is also a type of master data. Customers, products, employees, materials, suppliers are also master data.
The major process to increase the quality of master data is by managing master data. Moreover, analysis outcomes and reports highly depend on the quality of master data. Usually, central repositories store master data. Single or multiple other systems use this data. As multiple groups use this data, there can be copies of the same data. It can lead to data inconsistency. Therefore, it is important to have an agreed-upon view across the organization.
What is Reference Data
Reference data is a set of permissible values, and other data can use reference data. Also, this data does not change frequently other than occasional revisions. Standard organizations define reference data. For example, assume country codes according to the ISO 3166-1 standard. Furthermore, units of measurement, corporate codes, fixed conversion rates such as temperature, length, width and calendar structure are some examples for reference data.
Difference Between Master Data and Reference Data
Definition
Master data is the data that represents the business objects which contain the most valuable, agreed upon information shared across an organization while reference data is data that define the set of permissible values to be used by other data fields. Thus, this is the main difference between master data and reference data.
Consist of
Furthermore, master data consists of key business entities, while reference data contains permissible values and attached textual descriptions.
Changes
A change in master data is always managed as a part of existing business processes, whereas a change in the reference data values may require an associated change in the business process to support the change. Hence, this is another important difference between master data and reference data.
Examples
Data of customers, products, employees, materials, suppliers and vendors are some examples of master data. In contrast, units of measurement, country codes, corporate codes, fixed conversion rates, and calendar structure are some examples of reference data.
Conclusion
Generally, master data and reference data are two types of data. Master data is the data that has a common definition across an organization while reference data is the constants that define permissible values for data. The main difference between master data and reference data is that master data is the data shared by multiple systems, applications, processes in an organization while reference data is a type of master data that is used by other data fields.
References:
1.“Master Data.” Wikipedia, Wikimedia Foundation, 27 Apr. 2019, Available here.
2.“Reference Data.” Wikipedia, Wikimedia Foundation, 17 Aug. 2018, Available here.
Image Courtesy:
1.” icon ” By Gaelen Pinnock (http://scarletstudio.net/) – These files were designed by a private consultant for the University of Cape Town’s eResearch Centre (CC BY-SA 4.0) via Commons Wikimedia
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