The most effective Category Management aligns the goals of your procurement organization with the requirements of your business stakeholders.
Addressing the approach to Category Management is one of the best things your Procurement organization can do to significantly improve the value it creates.
This is used to set an aggressive, but achievable, category vision that identifies where the business stakeholders and procurement want the category to be in three years.
Identify the stakeholders within a category to determine their level of support and influence - drive for active and open engagement. Establish the objectives of the Category Management approach.
Mapping the category and subcategories (spend, suppliers, geography, stakeholders, business requirements) providing a deeper understanding of the category spend within the organization and insight into potential opportunities.
Assess performance of the existing suppliers against the business requirements and determine areas for improvement.
Develop a comprehensive view of the broader market for the category including key suppliers, market share, risks, opportunities and capacity. Assessing the market dynamics of the category provides insights into how your organization is positioned in the market.
Use strategic tools, outputs from the earlier steps of the process, and stakeholder input to determine the multi-year vision and strategy for the category. After that, you can identify clear priorities to implement.
The end result of the Category Management process is a prioritized portfolio of projects (based on value, complexity, effort, time and risk) to be executed to implement the category strategy.