# Master Data for Planning

Master data is the foundational reference data that every planning process depends on. When planners talk about "the product hierarchy" or "lead times," they're talking about master data — the relatively stable attributes that give structure to the transactional data flowing through IBP.

Get master data right and planning becomes a matter of judgment and strategy. Get it wrong and every cycle starts with arguments about whether the numbers can be trusted.

Product master data is the backbone of demand planning, supply planning, and financial reconciliation. Every plan rolls up, breaks down, or filters through the product hierarchy.

Each plannable item needs a minimum set of attributes:

The hierarchy determines how items roll up for planning, reporting, and meeting discussions:

SKU → Subfamily → Family → Category → Division → Business Unit

Why hierarchy design matters:

• Demand planning — Forecast accuracy typically improves at higher aggregation levels. Planning at family and disaggregating to SKU is a common approach.
• Reporting — The hierarchy defines what shows up on the IBP scorecard. A poorly designed hierarchy means the wrong items get grouped together.
• Meeting focus — The IBP demand review discusses exceptions at the family level. If families are too broad, important signals get hidden.

Customer master data enables demand segmentation by channel, account, and geography — critical for understanding where demand is coming from and applying the right service strategy.

Ship-to → Sold-to → Account → Channel → Segment

Why it matters:

• Demand planning by channel captures different demand patterns (e-commerce growing at 15%, wholesale flat).
• Service differentiation — key accounts may warrant higher fill rates, which drives inventory policy by customer segment.
• Allocation logic during constrained supply depends on customer priority tiers.

Supplier master data becomes critical as IBP matures beyond internal planning to incorporate external constraints. This data feeds directly into procurement planning.

For critical materials, maintaining supplier capacity data enables supply risk scenarios — "What if Supplier A can only deliver 70% of contracted volume?" This feeds directly into scenario planning.

The BOM tells planners what components are needed to build each finished good and in what quantities. It's the bridge between demand plans (finished goods) and supply plans (components and raw materials).

What the BOM tells planners:

• Component dependencies — Which raw materials and sub-assemblies are required, and in what ratios.
• Make vs. buy splits — Which components are manufactured internally vs. purchased.
• Common components — Items used across multiple finished goods, creating demand aggregation opportunities and risk concentration.
• Yield and scrap factors — Adjustments for expected material loss in production.

BOM accuracy matters because:

• Inaccurate BOMs produce incorrect material requirements, leading to shortages or excess.
• Capacity planning depends on accurate routings and BOMs to project resource requirements.
• Cost roll-ups for financial planning use BOM quantities multiplied by component costs.

Routing data defines how products are made: which work centers, in what sequence, and how long each step takes. Combined with calendar data, this enables capacity planning at the RCCP and CRP levels.

Planning implication: Rough-cut capacity planning (RCCP) uses simplified routings at the critical resource level. Detailed CRP uses full routings. Start with RCCP — most IBP processes never need full CRP detail.

Cost data is essential for translating operational plans into financial projections — the "I" in IBP.

See Financial Planning for how cost data feeds the IBP financial reconciliation and Supply Chain Costs for a deeper treatment of cost structures.

Master data without governance degrades over time. IBP depends on data that is accurate, timely, and consistently maintained.

Every data domain needs a clear owner:

Master data changes — a new product launch, a hierarchy restructure, a lead time update — must flow through to plans in a controlled way:

• Define a change request process: who can request, who approves, what's the effective date.
• Changes mid-cycle should be flagged so planners understand why numbers shifted.
• Major hierarchy changes should be timed to coincide with the fiscal year or a natural planning break.

Schedule quarterly data quality reviews covering:

• Product hierarchy completeness — are all active items assigned to a family?
• Lead time accuracy — do planning lead times match actual receipts?
• BOM accuracy — spot-check 10-20 high-volume items per quarter
• Discontinued item cleanup — are inactive items flagged or archived?
• Cost data currency — are standard costs updated at least annually?

• Data Foundations — What data IBP needs at each stage of maturity and how to assess data readiness.
• Capacity Planning — How routing and capacity data feed resource planning.
• Procurement Planning — How supplier master data supports procurement decisions.
• Financial Planning — How cost data enables the financial reconciliation step.