Prerequisites (Optimization Engine)

Before you get started with Optimization Engine on a customer partition, go through the following steps:

• Assess the customer’s need for an Optimization Engine solution. Some of the questions that help you make the decision are:

  • Product segmentation: Does the customer segment their products based on some pricing attributes? Do they review frequently this segmentation? Do they apply specific strategies related to each segment (discount structure, discount level, minimum margin requirements…)? Do they set targets based on this segmentation and monitor the results?

  • Customer segmentation: Does the customer segment their customers based on some pricing attributes (purchase power, margin, selling channels…)? Plus similar questions to those for product segmentation above.

  • Pricing strategy: Is there a clearly defined pricing strategy to work towards? Improve margins, market share, volumes, production facility load, price perception…?

  • Price optimization: What part of the price waterfall should be optimized? What is fixed and what may vary and be optimized: list prices, discounts, net prices, pocket prices…? Does the customer have business goals and/or alignment rules to set their prices based on products, customers, others?

  • Pricing guidance: Do sales representatives have price guidance? Do they have the possibility to adjust the prices? On which criteria? Is the price guidance optimized based on business goals and/or alignment rules between products, customers, competitive inputs? Do business goals and price alignment constraints make pricing complex? Do several price guidance scenarios are evaluated to find the best strategy?

• Get customer data in the correct format to a partition.

  • The current Groovy logic uses “Datamart”.

  • List of customer’s Data Sources needed for the current use case “Waterfall Optimization”.

• Set the customer’s partition for Optimization Engine.

  • It is recommended to set your partition's heartbeat to a low value (20 s).

  • To run an optimization model, your partition needs to be allowed to use the Optimization Engine. The Optimization Engine image is automatically enabled on the partition when you deploy the accelerator using PlatformManager, with 2 CPUs and 4Gi memory. Please contact Pricefx Support if you want to increase these values.

• Describe the customer’s business problem in the form of an optimization model.

  • It is a process between the customer and the Pricefx project team to accurately describe the optimization problem. More details are provided in Problem Modeling (Optimization Engine).