How to apply the category management cycle?

• Initiate project (if required)
• Define initial scope and objectives
• Engage stakeholders and gain support
• Identify and secure resources and access to specialist skills
• Form cross-functional team
• Map stakeholders and create stakeholder management plan
• Build a project timeline

• Create communication plan
• Define data/information and knowledge management requirements
• Define roles and responsibilities (RACI)
• Confirm initial scope, potential benefits and risks
• Conduct a formal ‘stop and think’ before proceeding e.g. gate review with senior business stakeholders

• Category Management
• Category Management Strategy
• Stakeholder Management

• Risk Management
• Risk Mitigation
• Team Competency Assessment

Research

• Define scope and purpose and source(s) of research. Agree roles and responsibilities

Conduct research and data gathering for:

• Product
• Portfolio
• Supply market. Undertake RFI if needed.

• Relationship history
• Conduct internal stakeholder needs analysis and determine strategic business priorities

Analysis

• Derive competitive insight – Porters 5 Forces / Capacity and Demand Analysis/Switching costs/ SWOT analysis/ Pricing Behaviour/ Industry Competitiveness
• Derive economic insight – value chain mapping/costs structures/cost modelling/margin analysis. Life-cycle costing

• Understand supplier capability and preferencing
• Determine category sourcing characteristics
• Understand the corporate responsibility

• Screen and prioritise opportunities
• Identify potential suppliers
• Determine desired relationship type and segmentation approach
• Qualify suppliers
• Conduct impact assessment (include corporate responsibility and CSR/sustainability factors i.e. social, economic and environmental impacts
• Assess the capability of the internal procurement process to deliver suggested changes
• Share proposed opportunities with significant stakeholders

• Screen and prioritise opportunities
• Identify potential suppliers
• Determine desired relationship type and segmentation approach
• Qualify suppliers
• Conduct impact assessment (include corporate responsibility and CSR/sustainability factors i.e. social, economic and environmental impacts
• Assess the capability of the internal procurement process to deliver suggested changes
• Share proposed opportunities with significant stakeholders

• Develop sourcing strategy/route to market and other recommended changes
• Quantify expected benefits
• Define resource and costs implications
• Quantify risk and develop mitigation plans
• Prepare detailed implementation plan

• Define relationship management and governance structures
• Confirm segmentation approach, relationship profiles and roles
• Confirm transaction process
• Conduct a formal ‘stop and think’ before proceeding e.g. gate review with senior business stakeholders

• Create service/specification and requirements
• Conduct market enquiry (RFI/RFQ/Pitch)
• Analyse responses
• Select preferred suppliers
• Negotiate
• Select supplier
• Contract with supplier

• Mobilise other strategy change initiatives
• Measure and communicate progress
• Manage transition risk
• Initiate relationship management process
• Deliver training for new/changed resources/systems/processes
• Apply supplier segmentation rules

• Manage and evaluate internal relationships
• Manage performance; non-conformance events, problem resolution, learning
• Manage supplier contract
• Manage supplier contract variation and changes
• Manage supplier contract termination

• Measure and review performance
• Communicate with stakeholders and suppliers
• Manage ongoing risk and continuity planning
• Manage transactions (fulfilment); demand notification, aggregation, forward demand planning, supplier allocation and payment
• Apply audit and controls

• Identify improvement opportunities
• Deliver continuous improvement actions; benchmarking, problem analysis, competitor analysis, supplier networking and development
• Capture/share learning and knowledge
• Consider internal/external events which change, challenge, provide opportunity or risk procurement deliverables

• Continue to align strategy and business needs (e.g. through the planning process)
• Communicate progress in delivering strategy and benefits
• Conduct formal ‘stop and think’ to re-affirm strategy effectiveness or as a result of a major internal or external trigger event