What is Category Management?
Category management is a strategic process where an organization divides its spending into specific areas featuring similar or connected products. This involves categorizing both direct and indirect commodities or services and analyzing their value, volume, and vendors. By doing so, it becomes possible to identify the sources of high costs and determine where focus and priority should be directed.
Importance of Category Management
Implementing category management brings significant benefits for organizations, surpassing the
outcomes achieved through traditional transactional-based purchasing methods.
- ✓ This approach directs procurement resources to concentrate on specific areas of
spending.
- ✓ Additionally, category management provides a data-driven foundation for
decision-making, empowering professionals to make informed choices that align with
organizational objectives and deliver real results.
- ✓ In times of market uncertainty, such as economic downturns or global disruptions,
category management becomes an invaluable tool for businesses seeking to build agility
and resilience and mitigate risk.
Our Process
- 1. We secure enduring advantages from the initial sourcing phase throughout the entire lifespan of the project, including troubleshooting and mitigation of supply risks.
- 2. We formulate a data-driven strategy for Category Management. Our team interprets the collected data to consistently operate within a category. They put in place a system to ensure continuous collection and accessibility of this data.
- 3. Employing our tools, we develop comprehensive action steps to monitor the Key Performance Indicators (KPIs) of each category and its suppliers.
- 4. This approach ensures you have reliable and precise data and information to establish an ongoing checklist for improvement.
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