{"id":3119,"date":"2023-09-22T15:11:15","date_gmt":"2023-09-22T13:11:15","guid":{"rendered":"http:\/\/engstromer.com\/?p=3119"},"modified":"2024-09-05T18:12:05","modified_gmt":"2024-09-05T16:12:05","slug":"category-strategy","status":"publish","type":"post","link":"http:\/\/engstromer.com\/de\/category-strategy\/","title":{"rendered":"Category strategy lived, and how to get there"},"content":{"rendered":"\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

<\/p>\n

\n

\u201cProcurement category software can accelerate reaching your goals. As I help clients with procurement savings, I notice when the forest is not seen for all the trees. It is great that procurement heroes can put out fires, but aren\u2019t we better with an institutionalized category strategy, and fewer fires?\u201d<\/strong><\/h2>\n<\/blockquote>\n

<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

You have a category strategy in your mind, perhaps also in PowerPoint. Some of your sub-categories are in a catalog, for consistent application and evaluation. As you apply category strategy, reality kicks in: stakeholders inform you late in the process (or not at all!); misclassifications and misuse of systems confound processes. <\/span>All the while, pressure is on you to deliver value and savings.<\/span><\/h4>\n

Procurement category software can accelerate reaching your goals. As I help clients with procurement savings, I notice when the forest is not seen for all the trees. It is great that procurement heroes can put out fires, but aren\u2019t we better with an institutionalized<\/b> category strategy, and fewer fires?<\/span><\/h4>\n

This is the kind of work I do. I am passionate about procurement transformation and do as much of it as I can, together with going for the in-year savings that my clients also want.<\/span><\/h4>\n

Procurement has come a long way<\/span><\/b> since it took the needs of businesses, as they came, to simply execute them. I no longer see order-takers as I advise clients in procurement. Instead, evolved procurement organizations are partners to their businesses, advise on sourcing options, and engage increasingly early on sourcing projects. <\/span><\/h4>\n

Ideally, category strategies are set up front<\/b>, to assess and conclude once, or periodically every few years, instead of at each sourcing occasion. Even complex categories such as BPO and CAPEX can be embedded in strategy. With them, one just needs to have better foresight about the evolution of the process and build in the flexibility needed, starting with early involvement by Procurement. <\/span><\/h4>\n

Having those strategies is ideal, but I rarely see them; the typical case is that I hear about them<\/b>. It happens so often that there must be significant hurdles to create and commit to them. Once I created a client-specific training for the process of how to create category strategies, but even with that it didn\u2019t intuitively spur strategy creation work; it needed to be actively driven.<\/span><\/h4>\n

As evolved as procurement has become, with or without strategies, I also see discrepancies between how things should be and how they are. This lies in the nature of the situation and is noone in particular\u2019s fault: in the instance, stakeholders want autonomy<\/b> in their decision-making; they only rarely source and do not worry too much about how. Procurement professionals don\u2019t always have a seat at the table, making it difficult for sourcing policies and strategies to work effectively. Exceptions undermine change work. Under these circumstances, investment in systems and processes is hard. <\/span><\/h4>\n

In the decade that has passed since I was a sourcing manager and providers were pitching their software to me (I would typically politely decline), procurement support has improved greatly. Its implementation used to be a project, and data wouldn\u2019t be fully integrated. Traditional procurement software was similar to ERP, getting over-customized and eventually no longer invested in. The difference in usability now vs. then is that the mapping stage has now been\u00a0automated<\/b>; implementation is more like using a wizard. Multiple sourced data can now be made sense of<\/b> using more flexible interfaces and used for decision-making<\/b>, with less intervention from Excel and PowerPoint. <\/span><\/h4>\n

There is business discussion about nudging<\/b>, making it easy for people to act right, rather than just instructing them and hoping for the best. This can be applied in procurement transformation as well. There is power in nudging for the right choices, giving positive marks for compliance, driving overall engagement, and leveraging positive peer pressure to give recognition for good results and right behavior. Since it is \u2013 let\u2019s be honest \u2013 a little mundane to order consulting services again or to go buy something more for the production line or hospital, those \u201chere is the solution for you\u201d<\/i> messages and processes really do matter<\/b>. You want your category strategies integrated and well-working.<\/span><\/h4>\n

Well-working automation doesn\u2019t mean all at once, but there are things that can be done in one go, things we need for crafting strategy well:<\/span><\/h4>\n