I’m often hard on Big X (in general), specifically when it relates to analytics or AI, because I regularly get insight into high project costs with low chance of return, see too many failure stats (where they get the lion’s share of the projects), and know that they struggle to attract the best people in those cutting edge technologies (as there is too much demand across the market, and too few STEM graduates, who want to go to the Big Tech Powerhouses like Alphabet or Meta or Microsoft, or, in AI, Open-AI or to a wild-west startup).

However, I’ve always noted that

• my opinions are restricted solely to these areas (and not in general, and not even tech in general),
• I believe they are often the best choices for many other projects, and
• sometimes they are the best choice. You just have to do your homework. (Some of these Big X have recently acquired smaller providers that built a team of experts in analytics and/or AI and now have some of the best experts in the world!)

But since I just wrote a very critical opinion piece on the (marketing) direction of specialist suite software vendors (when I’m normally just praising best of breed vendors), I’m going to turn the tables and write a very positive piece on when you should use Big X. Even if it may seem sometimes that I’m against them, especially if I’m on a rant (and you have to remember, SI is a blog for information and entertainment purposes, not a paid analyst site!), I’m not. For the most part, especially if engaged properly, you can get a lot of value from a Big X, and, furthermore, sometimes get value you can’t get any other way!

(I’m just critical of non-value, and jumping all in on a new technology / digitization project with a Big X without blindly investigating both the project and the Big X’s proposal is usually not the right way to get value. And yes, in this situation the blame for any failure should fall on the company that didn’t do its homework and not the Big X.)

So here are three ways to get value out of a Big X, guaranteed and risk free if you approach it right:

• Strategy: especially
  • Corporate: corporate strategists don’t work for companies, and the best don’t work for small niche consultancies, they work for Big X companies where they do these types of projects for big clients all the time; and only the Big X have enough of an archive across their talent to build up patterns that work and project real industry trends
  • Marketing/Sales: there are a lot of niche marketing shops for small scale consumer marketing, and a few for global marketing, but a lot of these shops are for executing a plan, not all can create one, especially if it needs to be co-created and tie into a corporate strategy
  • Operations: operational excellence is most often found in two places: business schools and Big X. ‘Nuff said.
  • Global Accounting/Tax Efficiency: what small, or even mid-sized, firm is going to have global knowledge of current and upcoming accounting and tax regulations and rates and can advise you on how to expand in a tax efficient manner?
  • Supply Chain Design: it takes a lot of people to have a lot of knowledge of all of the countries a multi-national will need to source from in its extended supply chain and sell to; this knowledge will rarely be found elsewhere (some of it from data subscriptions, but you still need access to human expertise on every country you are considering)
• Process Redesign: the next step after operational strategy is process redesign, and these firms have deep insight into best practices across the board, detailed playbooks for conducting these projects, and deep insights into what is working and not;
• Gap Analysis: if you don’t need a total operational process redesign, but just improvements, or technology to fill the gaps, they can just do a gap analysis and find weaknesses, make recommendations, and help you outline technology needs, and even help you create a good RFP to send out to potential vendors (however, unless you do your homework and provide them with good, deep documentation up front on your processes and systems, they will have to do a lot of manual labour to build that picture and that will result in an expensive RFP; but again, most of the cost will be on you and not them)

And, of course, used right,

• Technology: not all technology is bleeding edge, and there are only a few categories at any given time where there just isn’t enough talent to go around, which is why our only concern is advanced analytics and AI projects (especially where you don’t know what you need^*)
  • Enterprise Product Selection: all Big X, which serve big companies, have deep expertise in tried-and-true enterprise applications; moreover, they tend to have partnerships that give them deeper insights than other providers, which can be very beneficial in your selection process;
  • Select Emerging Product Selection: many Big X are investing in technology players that are up and coming that they see as next generation enterprise solutions; they have deep insight into the products they are investing in (but, as you can expect, limited insight beyond publicly available information into solutions their competitors are investing in)
  • Enterprise Product Implementation: they not only have deep insight into enterprise products, especially in the back-office (ERP, Finance, AP, etc.) and supply chain (planning and logistics), but deep implementation experience in the platforms as well; plus they have detailed step-by-step guides that even the most junior hire can follow and succeed
  • Partner Product Implementation: they know their partners well, especially since they usually won’t take on a partner unless it has a training program to train the implementors or a support team for the implementors
  • Appropriate, Well Defined, AI & Analytics Projects: we rant here all the time because most companies ultimately get this wrong (most Big X, most Suites, and definitely most clients); the reality is that the technology has progressed so far so fast that there are very few that understand just what is out there, where it is and is not good, and how it applies to different market/company situations; the reality is that with all of the recent dynamic shifts in markets, supply chains, and demand, and sometimes a complete lack of consistent, historical, data to base on analysis on, standard methodologies don’t always work anymore; you need experts, there are not enough to go around relative to explosive market demand, and you need the right expert for your problem; and even if the right expert exists at the provider you select, you will only get the right expert if YOU define the problem appropriately;
    this being said, with many Big X companies now acquiring specialist AI and analytics firms, as well as world class experts, there are a number of projects they are very well suited for — but you have to define the right project and make sure it’s right for the firms you invite

… and for most of these areas, you’ll struggle to find more than one or two niche companies that can deliver the same value, if you can find any at all! (And they only have the manpower for so many big projects compared to a Big X.)

In other words, we aren’t against Big X, and in fact recommend them regularly (just like suites we also pick on in our opinion pieces) we are against automatically using them for advanced technology projects that aren’t well defined, where they may not have the right expertise available for your problem at hand.

And we’re tired of the high failure rates, so if you don’t know what you need, stick to what they know well and always deliver on to your satisfaction until you know what you want!

^* The reason for high tech failure rates usually boils down to two fundamentals. 1) Lack of Preparation and 2), as THE REVELATOR would say, an equation-based technology led platform approach vs. an agent-based human led solution approach. Preparation is key. If you don’t know what you need, and specify it clearly, you can’t expect the provider to know what you need, make the right interpretations, put the right proposal together, and assign the right people when you accept it. (And this goes for all providers, not just Big X.) This means that the Big X proposal writer is forced to make assumptions and then make a plan and assign resources based on those assumptions. And if they are wrong, because you did not provide the right clarification either in your request or your acceptance of the proposal, the project will not deliver the results you expect with the indicated time and effort, leading either to cost overruns, time overruns, or, if you’re not on the ball, complete failure. And, if the Big X did their best to understand your needs, it’s your fault, not theirs, but it’s still another failure.)