Category Archives: rants

Two Hundred and Twenty Nine Years Ago Today …

The first foundations were laid for the patent pirates with the introduction of the first U.S. patent to Samuel Hopkins for a potash process. While patents are a necessary evil to protect the investments of real inventor and corporations that have to spend millions upon millions (sometimes to the tune of hundreds of millions) to produce a truly new technology, software patents are an unnecessary evil that allow the pirates to plunder millions upon millions of dollars from rivals with fundamentally different products (but covered under an interpretation of a sufficiently abstract description) and prevent true innovation in our space.

It’s been a downhill trend ever since the first software patent was issued 51 years, 3 months, and 8 days ago as it was a mere 4 years before the software patent pirates saw an opportunity when the first software patent case went before the courts a mere four years later.

That’s right, we’ve had almost five decades of pirates in cyberspace, and you thought malware was the big problem?

How to Get Past Applied Indirection

As per our recent series here on SI, when most vendor sales rep start to claim they have AI, they are really just telling you to your face that they are trying to mislead you into thinking their trivial automation, simple fixed ruled-based workflow, and/or classic statistical projection capabilities are much more advanced than they really are, hoping you won’t ask what AI really stands for when they use the acronym.

Given that your number one priority is to get more spend under management (SUM) and that this priority is only realized with the help of modern platforms, you’re going to be dealing with a lot of sales reps for years to come, especially since, at best, you’re on a generation 2 platform (and, to be honest, if you have anything, odds are it’s really generation 1), and that just doesn’t cut it anymore. So you’re going to have to find the right platform for you.

Now, the good news is that you have help narrowing down that shortlist with the help of Spend Matters Solution Map, co-designed and, in core areas of platform technology and Strategic Procurement Technology, scored by the doctor, and that as part of this narrowing down, we can help you identify vendors with the foundations for real AI, as well as, if we’re lucky, select capabilities that fall in the domain of assisted intelligence.

But just because we can give you a partially pre-qualified short-list (which can be tailored to your specific organizational needs by way of the Customer Map offering), that doesn’t mean that the vendor sale reps still won’t try to stretch the truth or, in some cases, even lead you astray on aspects of the solution we don’t score. So you will still have to deal with some level of applied indirection even if you’re proactive enough to take our advice and start with the right short-list. (Which can also be based on unbiased customer scores as well as in-depth analyst scores across up to 700 discrete platform capabilities to make sure you start off with the best candidates, among which will be the right solution for your organization.)

But if you’re not one of the lucky supply managers able to convince your boss to let you spend the money on this exercise (which can be carried out by your favorite consulting partner who will help you properly weight the various capabilities given your organizational maturity and need), then you’re going to not only get hit with quite a few sales reps stretching the truth, but a few outright lying (because they know you don’t have any validated data points to go off of), and not feeling a tinge of guilt because they told you up front they were selling you with AI (which you didn’t ask them to define) that really stood for applied indirection, and not the assisted, augmented, or artificial intelligence that you mistakenly assumed it stood for.

So how do you spot it? And get past it?

Here are some tips and tricks to do just that.

1. Ignore their claims, get a demo and ask them to walk through through how it supports your organizational process, which you will lay out the day before

Yes, some vendors have become quite good at combining (robotic process) automation, rules-based workflows, and statistical algorithms to fake AI, to the point that you might think there is actually some machine learning under the hood and, at the very least, they have assisted intelligence technology in the worst case, and probably augmented intelligence that will take your team to the next level. But not very many vendors fall here (and in the grand scheme of things, the reality is that very few vendors fall here), and very few demo masters can pull off a faked end-to-end process demonstration.

2. Have your own data files ready to go!

If they are claiming auto-contract parsing and clause extraction, have some contracts in the correct format (PDF, Word, etc.) ready to go at demo time, that you did NOT give the vendor advanced knowledge about, and ask them to upload and walk you through the process live. Or if it’s a 3-way invoice match process, have matching POs, goods receipt, and invoices in whatever standard they support (cXML, EDI, indexed PDF, etc.) ready to go as well and ask them to suck them in and process them in front of your eyes.

If they survive this, even if it’s not real AI, it’s very advanced automation and an extensive knowledge-base supporting the rules-based workflow, which may be all your organization needs to advance its SUM and get success.  (For example, you don’t need AI for spend categorization – an expert can map your spend to 98% accuracy in 3 days with the right tool even if you are an F500 and then as exceptions come in, you have an expert create overrides, which get fewer and further between over time. Plus, unless we are far, far into the tail, 2% of spend in the category doesn’t even make a dent.)

3. Get a real data scientist / tech expert in on the demos.

Someone who has utilized real AI technology to ask tough questions about algorithms, platform foundations, data stores, and so on. If the provider can’t furnish good answers, there’s probably not too much under the hood.

4. Talk to mature customers.

You want customers who have been with the provider 3+ years, implemented and worked through the full platform offering, executed difficult Sourcing / Procurement projects, had a few failures the provider needed to respond to quickly, and so on. They can give you an idea of how advanced the system has been in practice and how good the provider has been on improving it. And if they give you a good recommendation, even if the system is not as advanced as the vendor claims, there’s probably something there.

It’s easy to not get fooled if you remember that the proof is in the pudding, and if the pudding is good, there are repeat, happy eaters of it.

The Supply Management Paradox

The best supply chain is invisible, but an invisible supply chain gets no recognition in your average company.

This is the one lesson they don’t teach you in Operations Management or Supply Chain 101, probably because they don’t want to discourage you given the upward battle we still face in our chosen discipline of Supply Management.

The sad reality is that your average employee in your average company, and even your average C-Suite executive in too many companies, has no knowledge of this paradox. Just like your average person is unaware of Bernoulli’s Paradox or even the Birthday Paradox.

At an average company, the majority of the supply chain function is invisible from most employees. Good show up at the warehouse, then get shipped to the office / store locations. When an employee needs a new laptop, tablet, or phone, s/he logs into the company portal and selects one of the pre-approved options and the item is on her desk within 2 business days. The sales guy places the order, and the customer gets it when promised. No one knows how much research and time goes into identifying appropriate suppliers, negotiating contracts, signing contracts, placing purchase orders, negotiating change orders, receiving goods, performing quality spot-checks, receiving invoices, matching everything, making sure the right goods get to the right locations, coding restock alerts / automated orders, handling returns (and ensuring credits are received and replacements arrive on time), handling switch overs when a new source of supply needs to be brought on, ensuring industry regulations are not violated, ensuring sustainability goals are met, ensuring there is no third party child labour in the supply chain (or anything else that could tarnish brand image), and so on. Hundreds, if not thousands, of hours have to go into making that “one click laptop replacement” work as desired.

Plus, in a well researched, planned, and smoothly executed supply chain, raw materials and components show up almost just-in-time (JIT) at the plant that is producing your goods. Then the boxes are waiting at the other end to package them, and as soon as the boxes are filled, the palletizer is there to pallet them. As soon as the pallets are full, the pallet jacks are waiting to load them unto the truck that just pulled up to take them to your distribution centers. Etc. Etc. Engineers don’t have to worry about raw materials or components being late or in insufficient supply. Loading dock personnel don’t have to worry about needing extra temporary storage as the trucks are there when the order is complete. Etc. Etc. Not only do they not have to worry about supply chain functions beyond their jobs, but your job looks like it’s the easiest job in the world because, like magic, everything (and everyone) is there when they need it. As a result, the better your supply chain runs, the less respect you get in an average company for doing a “hard” job because you make it look so easy.

That’s the supply management paradox, and one of the reasons many of us still don’t get No Respect.

Still Looking for that Supply Management Usability Guide!

Long-time readers will know that there are a lot of guides out there as to what a good Supply Management solution for Sourcing, Procurement, etc. should do — including a lot of advice on this topic here on SI and over on Spend Matters, but not many guides. And while the doctor did write rather extensively on the topic of usability in Sourcing, Supply Management, Procurement, and P2P over on Spend Matters Pro, there are still very few guides for usability. (Searches in major search engines still come up few and far between, even after our first post on the topic here on SI seven years ago).

As per our last post, if the provided software was so obvious and easy to use that even a fifth-grader could figure it out, then the issue of “ineffective instructions” is a small one. But the reality is that, even with most platforms that are attempting to adopt consumer-style interfaces, most procurement and logistics software is still reasonably complicated due to the complex nature of what a Procurement or Logistics package capable of supporting global trade needs to do.

The thing is, even though the functionality is well understood, the best way to lay out the functionality, and underlying workflow, is not well understood in comparison and, unfortunately, if one company builds an interface that is too close to a competitor’s for some standard functionality, instead of the formation of a standard, in America, we get a frivolous lawsuit (courtesy of the patent pirates). So even though there should be design standards, there usually aren’t.

And even when the best-of-breed providers finally figure it out, since most of their UIs are built on decade(s) old technology, updating the UI is no easy feat. Especially when the new generation of employees, the millennials, are expecting consumer like interfaces. But who has anything close to this? Coupa with parts of the core platform (which has been built and re-built repeatedly to be easy to use around core Procurement functionality) and advanced sourcing (built on TESS 6 built from the ground up to be eminently configurable); Zycus is on the right path with their dew drop technology, but it will take a while to upgrade the entire platform; Vroozi with their mobile-first philosophy is quite usable for what it does; Keelvar with their configurable automation-based workflows; and GEP with their new user-centric UI vision are not just a few examples, but the majority of examples.

In comparison in the S2P game, Ivalua is getting close with their configurable workflows, but it’s still not obvious how to configure the platform to make it obvious to junior users; Wax Digital is one platform on one code base and pretty simple (but based on older Microsoft tech that takes time to upgrade); Determine, based on the old b-Pack platform is very configurable, but older technology and far from a modern look-and-feel; and Synertrade is really outdated (but very powerful).

And if we go beyond the big names, when it comes to the smaller vendors, except for a few of the newer best-of-breeds, like Bonfire and ScoutRFP, usability has always been a second concern and while a few of the smaller vendors are updating their UI (like EC Sourcing which should be much more modern with a year), most vendors are definitely not there yet.

Hence, since most platforms aren’t consumer like, and not likely to be figured out 100% by junior users without training, we still need that Supply Management Technology usability guide — especially since none of the platforms mentioned above with “modern” interfaces have the same workflows for the processes they support.

And what about the poor organizations who still have a mishmash of five generation one or two systems with inconsistent interfaces and workflows? What hope do they have of making sense of the full inter-related capabilities of their systems? Very little.

And while the doctor knows more than ever that the very nature of software, which is always evolving, makes such a guide difficult (and that this particular challenge is compounded by the fact that America still allows software to be patented so the pirates can plunder), but there should be at least some standard workflows and processes that all sourcing, procurement, and logistics software should attempt to follow in a reasonably standard way. It would make things easier for all supply chain partners, minimize unnecessary stresses and bumps, and help us evolve the profession as a whole. But alas, it will probably be another seven years before we get close to a real usability guide.

Enterprise Software Companies Do Need Media Relations (Re-Post)

This post initially ran five years ago, but since the PR frenzy is back (as a result of the M&A frenzy), this needs a re-post!

In yesterday’s post, we insisted that Enterprise Software Companies DO NOT need Public Relations, because they do not. Why? Simple. They DO NOT sell to the public. They sell to big corporations. Big corporations are not the public.

Also, the messaging that you need to sell to a CFO is nothing like the message that you need to sell to an impulsive consumer. Good business is all about productivity, progress, and Return On Investment. Good public relations is all about feeling, connection, sexy, environmental responsibility, or anything else that happens to be the buzz of the day. Good enterprise relations is all about results. Public relations, like consumer advertising, is in constant flux. But the basics of good business never change.

However, the advertising channels through which business advertising have exploded, not only as a result of the rapid expansion of the ubiquity of the world wide web, but of social media as well. As a result, the complexity of media management has increased dramatically. The fundamentals haven’t changed, but the amount of work required to coordinate and manage the effort has. Not to mention the knowledge required to strategically place your advertising and messaging to stand out amidst the noise, which consists not only of a constant stream of advertising and messaging from your competitors but analysis, third party reviews, and random comments. It’s a media jungle, and unless you have a team of full time pros to manage it 24/7, you need help. Even if you do have a team, you probably need guidance.

A good Media Relations Team will help you:

  • Identify the Right Channels
    Which traditional print and online web publications are right for you?
    What are the right channels to advertise your coverage?
    Who are the right people at these outlets to reach out to?
  • Tailor the Message
    While you need to craft and own your message, you also need to recognize that different individuals at different publications who control different channels are interested in different parts of the message you have to deliver. To get your message heard, sometimes you have to focus in on the part that will get a crier’s attention.
  • Spread the Message
    Parts of your message have to spread through others, but thanks to the social media revolution, other parts have to be spread by your organization through social media channels. Managing these can be a full time job, and not the best use of your limited resources. This is best left to an expert.

In other words, you need help, but the help you need is not Public Relations. It’s Media Relations.

And if you really need someone to talk to in order to help you elicit your messaging in a collaborative fashion, hire a subject matter expert (SME) whom can also offer you project management, product development, or thought leadership consulting services. This will jump start those efforts as the subject matter expert will not only be fully familiar with your messaging, but with your modus operandi as well. As a result, there will be little to no learning curve for the SME when it’s time to start the project management, product development, or thought leadership creation. This will pay off in spades as you’ll get your project, product, and/or thought leadership done faster, hit the market faster, and see a significant return faster.

So when it comes to getting help, get the right help. Even if you don’t thank me for it.