Future Purchasing Advent Calendar Window Eight

Posted 08/12/2016

“Financial investment is the no. 5 driver of category management performance. Yet only 30% of respondents say they have enough…”

Our analysis demonstrates this is the fifth most important driver of category management and ultimately firm performance.  The statement was “Our financial investment in Category Management is sufficient to deliver our expectations”.  Overall only 30% of respondents agreed their financial investment in category management was sufficient to deliver their expectations.  So we have a situation where returns could double or triple, or more, depending on your company’s starting point, so the business case is relatively easy to make, but financial investment to enable it for more than two thirds of respondents is not enough.

Interestingly even the Leaders did not have a positive response to this either, with 53% of them saying the investment was not enough to fully deliver, which is why they also still feel opportunity is left on the proverbial table. This compares with 24% of Followers.

New Year’s Resolution No. 8: Our analysis demonstrates that obtaining investment is a top driver of performance and should be targeted as a priority if you are one of the 70% of organisations that have yet to do so.  The scale of change required to implement category management can be substantial. Ongoing headcount budget may be required due to increases in the number and experience levels of the team. External support may also be needed to provide new methodologies and ongoing training and coaching. Organisations often recognise the opportunity for change when a new CPO is appointed. They construct business cases that directly link the investment in category management to an uplift in savings from the function along with other benefits.

Investment in category management makes the transition from Follower to Leader more likely to happen and quicker. So along with the advice for making a business case in New Year’s Resolution No. 2, to show the potential return, make sure you outline what investment you need in people, systems and processes as well.

You can click below to download our 2016-17 Global Category Management Leadership Report Executive Summary.

Tagged by topic: Category Group Planning , Category Management , Category Management Survey

  by Allison Ford-Langstaff

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