Strategic sourcing

Smash Sourcing Silos with Category Management

Smash Sourcing Silos with Category Management

SIG University Certified Sourcing Professional (CSP) program graduate Silver Chaudry discusses how category management takes sourcing initiatives out of silos to create shared objectives and continuous processes across business units that drive efficiency.


Category management is a strategic and collaborative approach to procurement involving the segmentation of related goods and services to proactively manage and consolidate spend, track savings and identify areas of improvement. Category management was first developed in the 1980s, evolving from strategic sourcing but differing as it is an end to end process where the analysis is continuously refreshed to keep up with changing market trends. (Strategic sourcing was typically reactive in nature, conducted for immediate requirements and taking place as a one-time event.) Category management also places emphasis on supplier development, where category managers work closely with suppliers to foster innovation and achieve superior outcomes.

>>Get the Guide to Understanding Category Management<<

Silver Chaudry, Sourcing Manager

SIG Speaks to Carlos Burgos, Director, Indirect Procurement, College Board

Carlos Burgos will present at the SIG Procurement Technology Summit

What is your role and what are your day-to-day responsibilities?

I am Director, Indirect Procurement, and my role is to manage indirect categories of spend. Those categories include office supplies, office equipment, maintenance and repairs, office services, HR and our contingent workforce program, among others. 

In my role I strive to reduce dependencies on sole-sourced vendors, automate processes by migrating where possible to a digital delivery, manage down our expenses and leverage our suppliers to come up with solutions that challenge our business operations. At the end of the day, I’m tasked with transforming our operating model to deliver an improved stakeholder experience with greater flexibility and at a lower cost.

What is something that you wish more people knew about sourcing and procurement?

I wish people knew how rewarding this profession is. We get to work on a variety of different projects that are challenging and unique. We get to work with all departments and divisions within our organizations, as well as work with all levels of employees from the CEO to entry-level colleagues. We play an integral part in putting solutions in place that affect our business operations, supply chain and ultimately our viability as a company.

In your opinion, what are 3 skills that sourcing and procurement professionals of tomorrow must have?

The 3 skills that sourcing and procurement professionals of tomorrow must have:

Carlos Burgos, Director, Indirect Procurement, College Board

SIG Speaks to David Bittner, Pre-Sales Director, Icertis

David Bittner will present at the SIG Procurement Technology Summit

What is your role and what are your day-to-day responsibilities?

As a Pre-Sales Director at Icertis, I am a solution consultant. I work collaboratively with companies to understand their unique business challenges and uncover the specific value Icertis solutions will provide. Often, I explain and demonstrate the “art of the possible.” Many folks think of contract software solutions in terms of a module or repository with authoring tools, and I help them see the bigger picture of the true value an enterprise-level contract management system can provide.

What is something that you wish more people knew about sourcing and procurement?

For folks outside of sourcing and procurement organizations, I wish more people knew how critical the sourcing and procurement functions are to a business. The contracts that sourcing and procurement professionals deal with every day govern every dollar spent and are essential to optimizing the business and accelerating commerce. But it’s not only about the dollars, cents and saving money. It’s also about reducing risk by working with the right suppliers with mutually beneficial terms and ensuring that everything is captured and tracked in contracts. I see sourcing and procurement as a longer-term, strategic function, not just tactical.

David Bittner, Pre-Sales Director, Icertis

Utilizing Soft Skills to Navigate Change Management

Kimberly Morelli discusses how essential components such as soft skills and change management can be.

SIG University Certified Sourcing Professional (CSP) program student Kimberly Morelli works at Driven Brands. She shares how essential components such as soft skills and change management can be and how she is implementing newly polished tools and best practices to tackle organizational challenges.

In the CSP program, students focus on the hard and soft skills of sourcing, including strategic sourcing and outsourcing methodologies, as well as best practices in negotiations.


My enrollment in the CSP Program from SIG University has proven to be timely and I am excited at the opportunity to have lessons that can be readily applied to our procurement organization. I also was heartened to find emphasis by SIG on positive supplier relationships versus an adversarial stance as used to be popular. The procurement team I am on has been in a state of transformation over the past few years, shifting from transactional buying to category management with a specific focus on increasing our sourcing processes. I found the CSP program to have laid a strong framework that is applicable to my organization, both in procurement and business areas.

Kimberly Morelli, Senior Category Manager

Talking to Your Tail Spend – Chapter 4: Frameworks to Manage and Find Savings

Find savings and learn how to build a strategic sourcing framework to help you manage tail spend.

This is the final chapter in our tail spend series and we’ve covered some significant ground to understand what tail spend is, why it happens, and the potential issues with ignoring it or managing it in the wrong way. In this final chapter, we'll explore the ways you can find savings in your tail and how to build a strategic sourcing framework to help you manage it going forward.

To get up to speed, you can read the entire Talking to Your Tail Spend series on our blog:

Amy Fong, Principal - Procurement and Purchase to Pay Advisory, The Hackett Group

This Month at SIG - July 2019

Golden hour sky sunset with city rooftop view background

If you’re looking for an excuse to escape the summer heat, SIG has some ways to help you bide the time inside with video-based learning, industry research, webinars and Career Network updates.  


SIG University

There’s still time to enroll in one of SIG University’s certification programs that can be completed on-demand in five, eight or 12 weeks. Our certification courses will expose your team to leading-edge training in strategic sourcing, third party risk and supplier relationship management. SIG University faculty are practitioners who hold senior leadership positions in the sourcing space and the courses are structured for a variety of learning styles.

To enroll yourself or your team, download the course catalog to get started.

14th Annual CPO Report

For 14 years, Zycus and Ardent Partners have captured the experiences, performances, perspectives and intentions of procurement executives. This report includes benchmark statistics, analysis and recommendations that procurement teams can use to better understand the state of procurement today, gain insight into best practices, benchmark their performance, and improve their operations and performance.

 

July Webinars

Source-to-Pay in 60 Days: Digitize to Drive Maximum Process Efficiency
July 11
Presented by: Zycus

Stacy Mendoza, Digital Marketing Manager

The Guide to Understanding Category Management

Procurement can efficiently manage spend and continue to achieve cost savings through the adoption of category management.

Cost reduction continues to top the list of priorities for procurement. As nations engage in trade wars and protectionist policies and extreme weather continues to cause disruption in supply chains, procurement will need to adopt new strategies to meet business objectives and goals.

Procurement can efficiently manage spend and continue to achieve cost savings through the adoption of category management, which is the process of categorizing goods and services and then managing these categories as "business units" to achieve improved outcomes in the most effective and efficient way. 

Category management was developed in the 1980s and takes a project management approach to sourcing to achieve improved outcomes, which is structured, measurable and drives continuous improvement. It is used in both the public and private sector, and while there is no standard categorization or grouping requirements, a general rule is to group goods and services that have similar characteristics. Organizations can use the United Nations Standard Products and Services Code to group categories or it can develop its own homegrown models.

Category Management is Not Strategic Sourcing

Category management is not to be confused with strategic sourcing, although category management evolved from the overall strategic sourcing approach. Some of the main differences between category management and strategic sourcing include the following:

Stacy Mendoza, Senior Marketing Manager

Tips for Buyers and Providers to Build Stronger Business Relationships

Best practices and tips for strategic buyer-provider relationships.

The relationship between buyers and providers can be a tricky one, especially when operating across multiple continents. Speaking during a podcast interview with Dawn Tiura, Sean Delaney, Vice President of Sales for cloud platform Determine, draws on his experience as both a buyer and provider to share best practices for relationships that are sustainable and strategic.  

WORK ON YOUR SOFT SKILLS

Technical expertise is valuable, but your ability to establish a rapport with customers is important for sustainable relationships. “Candor is important because there's a large degree of personal credibility that buyers are putting on the line when selecting a vendor," says Delaney. "That needs to be understood as a seller and we need to make sure that we don't break that trust. That's our role.” 

Stacy Mendoza, Digital Marketing Specialist