Category Management isn’t a new concept, neither is Category Strategy Creation. And still, we often see procurement teams struggling to get started with the process or following it through.
What’s holding them back? What are the hurdles and barriers those teams, or some of their team members, are facing and need to overcome?
It’s worth taking a closer look at the root causes, which, when you think about the benefit and opportunity linked to category strategy creation, shouldn’t exist in the first place. Too much is at stake in category management to accept mediocre performance.
“The move from being a category management starter to a category management improver could result in a saving performance uplift of up to 153%”
— Future Purchasing Global Category Management Report, 2021/2022
Why is it so hard to get started?
Let’s start with the individual. What does a Category Manager have to bring to the table to create a high-quality category strategy? Apart from the experience and know-how related to their category (which may be deep or rather superficial), and the contextual knowledge of what it all means for their company (which, again, may vary widely), it comes down to mastering a certain methodology and being familiar with all the analytical tools that get applied along the process. That’s quite a lot, and the more sophisticated the methodology, the greater the challenge for the Category Manager to master it.
Haven’t we all been in a situation like this? Staring at a blank sheet of paper or an empty 2×2 matrix, trying to figure out which conclusions to make out of all the bits and pieces of knowledge and expertise we have. We knew what we knew, and we had some relevant data available, yet still it was difficult to put it all together, synthesize it, and come to solid conclusions and recommendations. A level of doubt always remained about whether we factored in all the relevant aspects, evaluated the situation correctly, or drew the right conclusions out of the many possible ones. It was stressful, from start to finish — especially early on in our careers.
“In order to play it safe, and to avoid embarrassing myself, I simply decided to not do anything at all – for as long as I could get away with it. The sheer thought of having to create a complete category strategy on my own truly scared me.”
— Junior Procurement Expert, Europe-based Automotive supplier and Cirtuo customer, 2021
And why was it so hard to follow through?
A phenomenon often observed is the fact that even after an ambitious start, individually or collectively, Category Managers get exhausted along the way. To the point where they either do not finalize their strategies at all or, in an attempt to just get it over with, wrap them up quickly with severe compromises on quality, just to tick the boxes.
Rest assured that over the months-long period it traditionally takes to develop a category strategy, the good old manual way, something urgent will come up in between — repeatedly and reliably, distracting and eating up the time originally set aside for strategy creation.
It doesn’t have to be this way. And it should no longer be this way!
Enter Cirtuo Guided Strategy Creation™ – the AI-powered game-changer
Imagine having a tool at your disposal that allows you to create a category strategy while not having to care or worry about methodology and analytical tools!
- Never heard of the Kraljic Matrix, or forgot what “leverage” or “bottleneck” mean in this context? No problem — focus on the input!
- Not sure where to draw the line between “Core” and “Exploitable” in a Supplier Preferencing Matrix? No problem — focus on the input!
- Struggling with the translation of supply market dynamics coming from a 5-Forces analysis to strategic levers with the highest impact? No problem – stay focused on the input!
- … the list goes on, with all analytical tools being applied.
Imagine a solution doing all the difficult or time-consuming work in the background and automatically generating all visualizations, drawing logical conclusions based on empirical evidence, and providing precise recommendations as output, which the users then review and adjust based on the extra knowledge and insights they possess. Human intelligence being put on top of artificial intelligence.
“As a Category Manager I can finally focus solely on the input I give, its quality and accuracy, while Cirtuo guides me through the process and does all the heavy lifting for me.”
— Category Manager with three years of procurement experience, Europe-based global Pharma company, 2022
No more hurdles, no more hesitation. Everyone can start now
- Category manager purely focused on input – not on methodology
- Guided along the process – well structured, no omissions
- Recommended strategic options – built-in focus and quality
- Suggested strategic options – pragmatic and proven
- Final editing and prioritizing – Category Manager always in driver seat
- Automated visualizations and report – no more PPT or XLS
Collaboration made easy — Teams become faster and more effective
In addition, imagine a tool that allows you to compress the time period you need to create and align a full-fledged category strategy from months to weeks! From weeks to days. Down to less than one hour required for a basic category strategy. This is the new reality.
Another welcome side effect of automation: The eternal battle with PowerPoint slides and Excel charts, consuming so much time and attention at the expense of the actual content, analysis and conclusions, no longer needs to be fought. A complete strategy document, be it as a full report or as an Executive Summary, is automatically created and available for download. At any time or stage in the process. Just like that.
How much does all that combined reduce the risk of occurrence and negative implications of distractions or disruptions? — significantly! And with the finishing line so close in sight from the very start, it’s also psychologically easier to pull ourselves together and follow through to completion.
“We now have a standard methodology and collective way of working, and category managers are being constructively challenged in their way of thinking and current level of understanding of their category.”
— Stephane Morel, Novartis; THE PURCHASER Magazine Issue 09, March 2022, Page 78
Imagine how much easier it will be to collaborate with category team members, when any of them have permanent access to all the information and the latest version of the category strategies in real time! If a sudden unexpected event takes out the capacity of one category team member working on a strategy, any other team member can seamlessly step in and continue the strategy creation. Facilitating teamwork and enhancing collaboration across functions has never been easier.
