Master data is the data that appears in every system: the customer that exists in CRM, billing, support and the warehouse, in four slightly different versions. MDM is the practice of resolving those into one record with a known identifier, and of deciding which system may change which attribute. It is technical work with a governance prerequisite, because matching rules and survivorship rules are business decisions dressed as configuration.
In practice. MDM projects succeed when they start from a specific pain — duplicate customers inflating the churn rate, a supplier paid twice — and cover one entity. They fail when they start from the ambition of a single customer view across the enterprise.
Where it goes wrong. The matching threshold is set by the implementation team. Somebody has to decide whether merging two records that are 92% similar is acceptable, and the consequence of a wrong merge is a customer seeing another customer's data. That is an owner's decision, and delegating it to a configuration screen is how MDM becomes a privacy incident.