Category Archives: Technology

PRGX – The Biggest Analytics Provider You Don’t Know!


For those that do not know it, PRGX would appear to be one of a select number of dominant services provider in the niche market for recovery audit services — a market that unlike other procurement services faces tremendous price pressure for its core recovery, statement and related auditing and profit recovery services.
the doctor and the prophet, PRGX Intro on Spend Matters Pro (membership required)

In particular, PRGX would appear to be a recovery audit specialist for the global retail sector. And that is what they are, but that is not all they are.


PRGX has started to remake itself quietly from within — out of necessity, given these broader market trends — building and acquiring technology capabilities in the spend analytics and supplier management areas, both to expand its relevance and to start driving automation and scale in its core business.

PRGX has built the most complete, and in many ways the most advanced, analytics and recovery solution for the retail sector and, in doing so, has built one of the most complete and advanced analytics and recovery solutions for just about any sector that buys and relies on goods. Pharma, Manufacturing, and Aerospace and Defense, just to name a few, could all benefit intensely from the out-of-the-box PRGX solution.

This is because it has evolved it’s application from a simple recovery analytics application to a full featured analytics solutions with modules for:

  • Payment Analytics
  • Spend Analytics
  • Product Analytics
  • Recovery Avoidance Analytics
  • Supplier Information Management

With the latter two coming through its recent acquisition of Lavante.

It can analyze what you paid (payment analytics), what you should have paid (recovery analytics), what you are spending (spend analytics), how much that is costing you and profiting you on a product level (product analytics), and what suppliers are supplying that product and how they are performing (SIM with a hefty dose of SPM).

And it can do this analysis end to end around a product or category, and allow you to simultaneously see what you ordered, spent, overspent, took in on sales, lost on returns, and profited when all was said and done. It’s one of the most powerful analytics solutions you don’t know about. Stay tuned — there is more to come!

It’s Not an AI Hype Cycle – It’s an AI Hype Wave!

Is it yet another AI hype cycle? This question was posed by Vinnie Mirchandani over on deal architect and it’s a good question.

AI has been the dream since the 1950’s when computing was just beginning and Alan Turing defined the famous Turing test (which is, sadly, not necessarily enough anymore because parallel computing and wide-scale sampling of real conversations can be used to pass the Turing test in many situations), but we’re not there yet. Enhancements to computing power, storage, and algorithms have made automated reasoning programs exponentially more powerful than they were sixty years ago, and today’s predictive capability is essentially unmatched … with many algorithms outdoing the best human experts.

But they are still not intelligent. They’re all based on data and trends which, for the most part, are predictable, and that’s where they excel — but where they are not, or where those trends can change on a dime, they still fail … some times spectacularly. Plus, if the data is incomplete or bad, they don’t always see this … and predict a wrong outcome. Human experts, on the other hand, can see missing data, outrageous trends, and when trends are inflecting in unexpected ways.

We’re nowhere near the point where we can even truly start using AI with a straight face, and, as per a quote from Yann LeCun, the director of AI research at Facebook, as quoted by the deal architect, despite these astonishing advances, we are a long way from machines that are as intelligent as humans — or even rats. So far, we’ve seen only 5% of what AI can do. And I’d say that 5% is an overstatement.

But, as the deal architect has indicated, we are seeing a huge increase in they hype about AI. As indicated by the deal architect, IBM has been marketing Watson since before it should have been announced, technologists are claiming that AI can replace entire fields, and Cambridge University has created a Center for the Study of Existential Risk to study extinction-level risks that can emerge from technological advances (like AI). Apparently, the hype is back … but the reality is that it never went away. It’s a continuous wave that crests and troughs and crest and troughs … it never goes away. The believers, for better or worse, won’t let it. There hasn’t been a decade where the hype hasn’t increased unnecessarily since the 50’s, and we’ll never see the end. Because until someone makes a true quantum leap, it will continue to be gradual progress, decade after decade, and the hype will continue ad-nauseum.

Has the Death of the Enterprise Suite Been Exaggerated?

There’s a big movement towards best of breed in many Procurement, and a bigger promotion on the part of many vendors towards such a movement. It makes sense, given that there are few suite vendors in the space compared to point-based best-of-breed vendors, which constitute the majority of vendors. But does that mean that the end of the enterprise suite is near?

Over on deal architect, the disruptor asks are enterprise suites dying? He notes the big disconnect between vendor and customer talk, including the facts that:

  • the last generation of vendor suites disappointed
    and that most customers ended up buying a number of “ring fence” applications and customizing the packages to meet their needs
  • the concentration of dollars with a handful of suppliers led to “lock-in” and bad vendor behaviour
    and the promise of economies from vendor reduction just stayed a promise
  • enterprises are finding a wide array of cloud applications
    that they themselves are weaving together

And these are true, and yes many burned CIOs are now anti-suite, but does this mean the suite is dead? There are still a number of managers and executives out there with the one-suite solution dream. Plus, as best-of-breed solutions pile up, the number of solution providers an organization has to deal with gets unmanageable for those CIOs who are under-staffed and under-resourced. So even if they don’t like the current suite providers, as too many solution providers creep in, they’ll like that situation even less.

So, while suites haven’t lived up to their promise, as Procurement organizations try to support their operations end to end with platforms, they are going to want less providers, not more. While they may not centralize on one suite, chances are they will want to centralize on a small number of multi-application vendors, and isn’t that just the definition of suite?

The Big Bad Blockchain

It’s not just the big bad wolf you have to worry about, it’s the big bad blockchain … especially when it becomes disassociated with bitcoin.

Bitcoin, which is neither good nor bad (it’s just another currency), is powered by a special type of blockchain — one that is decentralized, open, and auditable by anyone using the system. And one that is extremely hard to alter because altering a block (to steal the currency) would require not only require that every other block after it were regenerated, but all copies of such block (and there can be multiple as all nodes participating in the decentralized system can store a copy of the block) be replaced simultaneously.

Theoretically, this can be used to record supply chain transactions because we could create a virtual currency for any real world unit we want to trade (such as CELLcoins, RAMcoins, etc.) but could also encode other related information in the hash and serve as a fully auditable record of ownership of the corresponding products end-to-end, source-to-sink, but this would require that a similar, truly open, system be developed.

But right now, when you get down to it, the most “open” blockchain proposals are akin to the most “open” supplier networks … and there are no truly open supplier networks. Every supplier network of note in existence is owned by a for-profit company and even those with “open” APIs or “open” integration are not really “open”. Yes, there is an API that third parties can integrate into, but in every case there is a “catch” — either the integration is limited or integration is only permitted at a “price”. It’s not open and free — and “openness” is only “open” as long as the network decides they are “open”.

If any company owns the blockchain, then it is not truly open, and not truly decentralized, open, and auditable by anyone and everyone. And that is necessary for a true block chain solution. So until a global non-profit conglomerate with Procurement punch and tech-chops steps up and creates a truly open, decentralized, non-corporate controlled block-chain solution, let’s stop pretending blockchain is the solution we’ve been waiting for … because all we’re going to get is a prison for our data that will come with hefty prison maintenance fees. And then we won’t just be talking about how “Ariba doesn’t have customers, it has prisoners” [Spend Matters]. We’ll be talking about how BlockChain Company X has everyone’s supply chain data as prisoner.

So while you continue your Bitcoin Buoyancy, we’ll keep our expectations realistic.

Procurement is Global. Platforms should be Global. Truly Global.

And, in particular, as previously noted, those platforms should form the foundation for Virtual Procurement Centres of Excellence. But just acquiring a platform is not enough. It has to be adopted — and not just in the center of excellence, but in every local purchasing department around the globe.

This means a global rollout, but not an instantaneous one. Big bang roll-outs usually end up in big blow-ups. The biggest supply chain disasters in history have often been the result of big-bang ERP or technology projects that tried to update the entire system all at once, often in a bet-the-company endeavour. Such a project even brought down a 5B company. (Remember Foxmeyer? Probably not, but that’s because a big bang ERP project resulted in a big bust.)

Now, a global Procurement platform roll out is not replacing the ERP and a failure likely wouldn’t bankrupt the company, but it certainly would be very costly and knock Procurement back into the dark ages it’s trying to crawl out of. So it has to be done right. So how do you do it right?

1. Take it in steps.

Start with just enabling the center of excellence so that the Procurement leaders can get familiar with the platform before the questions start rolling in. After all, they will be the trainers, leaders, barkers, and bugle-men of the solution, and need to be prepared the lead the charge. After that, enable just a few locations at a time until each is up and running.

2. Get the data model right before a single implementation.

Remember, you have to control the information and financial chain with the platforms, and this will require integrating with data from dozens, if not hundreds, of systems and sources. Without a good data model, integrations will be difficult and time consuming.

3. Identify the systems of record for each data component.

The days where the ERP is the system of record are long gone in leading organizations. These days, organizations have a financial system as the system of record for invoices and payables, a supplier management system for supplier (and sometimes catalog) data, local catalog management for products and services that are primarily sourced locally, a CAD/CAM system for product designs, a MRP system for custom product designs, and so on. Make sure the integrations with each of these core platforms is complete and accurate before using the new system for the first Procurement event.

4. Define small test projects that can be used to evaluate the implementation adequately before continuing with the roll-out.

Pick a few representative, but not mission critical, projects that can be completed in weeks (not months or years) that will adequately test the system, define milestones and checkpoints, and evaluate at each stage. Only continue when any issues or bugs are identified and corrected.

5. Make sure you have experienced, expert help for the roll-out.

Each office will have its own particular process needs, regionalization (in terms of language and currency), audit trail requirements, and so on. Expert help can not only help you identify these requirements but appropriate system configuration options for maximum performance and minimal complexity at each location.

In other words, create a reasonable plan, with expert help, and stick to it. Things will generally go smooth if you realize that, like every evolution before, the advancement of the Procurement function is a journey. You can’t always afford to stop and smell the roses, but you can’t afford to run through the thorns either.