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Defining Spend Analysis 3.0: The path from spend summaries to deep insights

06/23/2021 By

In Spend Matters’ last two PRO articles in this series, we talked about how spend analysis today is a bit like George Costanza in Seinfeld’s world. He’s something you have to laugh at, not with, when he tells us we're buying computer mice, not furry lab mice, even when we are a global Pet Emporium — a shockingly common scenario found in first-generation auto-categorizers in (primarily) second generation spend analysis solutions. We summarized how, with proper use, the best 2.x solutions will provide value, and in the hands of a true expert, more value than a skeptic might expect. Previously, we hinted at the core capabilities of spend analytics 3.0 in our fist post and identified some core requirements of such a system in our last post when we outlined some key value-generating scenarios that are not possible in 2.x systems, or at least not possible to the extent necessary to extract the full value in the data.

Yet without the full power of spend analysis within your grasp, you'll never know just how much value you're not capturing — an amount that could be multiples of what you are paying for a solution that is supposed to help you identify, and even prevent, overspending. That’s why, in this post, we fully define the capabilities of a 3.x solution and lay clear how it differs from 1.x and 2.x solutions by specifically defining what those solutions do (and thus do not) offer. Then, once we have made clear the levels, we provide an extensive list of analyses that can only be accomplished by Spend Analysis 3.0.

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