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Why do we need reference data?

Reference data helps classify and categorise information.  It is a type of Master Data, and it typically changes very slowly (if at all). Examples include:

  • Iso codes
  • Country codes
  • Product codes

Reference data doesn’t change very often hence it’s important we get it right.

To that end, one of the main things you can do with reference data is force standardisation by having people choose from a predetermined list of values. You could think of this for something like a country code or a country telephone code. Imagine people having to type their own country code in a free form textbox. Some people might put 00 in front while others might put + instead, or simply leave it blank. Let’s use Singapore as an example.

(Singapore) 97503525

(0065) 97503525

(+65) 97503525

( ) 97503525

If we can provide a dropdown of reference data for people to select their country and it automatically populates the country code for them.

That helps the person inputting that data because they don’t have to know what’s their country code. All they have to do is look it up and in this instance, select Singapore which is +65.

This standardised information can then be used by other business processes and other teams across the organisation. For example, it’ll make sure we’re not calling up our customers using an incorrect country code.

A healthcare use case

If we are prescribing drugs to patients, we have to be very careful. The wrong dosage might make someone sick. The wrong product might kill someone. And we must know what we have prescribed and to whom so we can re-stock our supplies and invoice patients for the products they’ve received.

Take Ibuprofen as a simple example. Many people take this to fight pain and inflammation. Some people take the brand name “Advil” others take a generic “Ibuprofen”. Both are the same medicine, and both will have the same benefit to our patients. If we can standardise the reference data so the uninitiated know that they can prescribe either Advil or a generic Ibuprofen safely and with the same effects, it allows us to stock multiple brands whilst still being able to search for “ibuprofen” and be returned a list of all types of this medicine that we can use.

Advil, an anti-inflammtory drug that contains ibuprofen v.s. ibuprofen itself

If we actually standardise – have reference data for each different drug and each different quantity of drug that is administered, it becomes easier for the organisation to know exactly what was prescribed and delivered to whom. As a result, they’ll know how much to bill for each of these products.

Whereas if we use different terminologies, there is the chance misunderstanding might occur. For example, I’m looking at Advil being dispensed versus ibuprofen, and I’m unable to match that up as easily as I would be if we had a common identifier, some reference data that allows us to know that both of these products are indeed the same thing.