Category Management
Get control over the complex world of IT Purchasing
Category management is the practise of segmenting the organizational spend to mirror how individual market places are organized. The purpose is to examine how organizations use the products, goods and services within a particular category, within the market place and with individual vendors.
The IT Category can be defined as a seperate part of your business expenditure, which you approach as a single integrated market for the supply of your IT products and -services.
Category Management leads to maximisation of value
Category management is a structured process for maximising value. To this end, the category manager does not focus solely on commercial expenditure, but work together with IT and Business Management with the aim of generating efficiency and profit at the same time. IT Procurement is divided into different levels of subcategories mirroring the different IT towers in the organisation (Infrastructure & Cloud, Network, Application & Hardware Management, Managed Services and Consultancy).
Each of these marketsegments has its own particular approach to maximise its added value. These specific strategy depends on the current IT-portfolio and future market vision of the organisation.
Why is Category Management important?
The IT - and business stakeholders collaborate with the Procurement category manager to obtain budget optimalisation and efficiency (lower prices, more quality for less money, better faster cheaper).
The IT market place is getting larger and complex, as purchasing functions source more globally with many suppliers. Today we are more aware of the brand or specification we want, and the best place to get it at best quality and price. An active category management framework allows IT, business and purchasers to work together around the world and get control over the complexity of a diverse global market of IT providers.
The dramatic value improvement for category management lies in terms of reduced cost and risk, increased innovation, brand value, greater effectiveness and stronger competitive position. It can make a clear contribution to the EBITDA.
The PACT approach for Category Management
We work close together with all stakeholders from IT, Business and Procurement to perform the following activities:
- Demand Analysis of the Business need (CMO, Quality/Quantity/Use, Must Have/Nice to Have)
- Supply Analysis of the market (Competitors, cost structure)
- RFI, RFP, RFQ or any other purchasing strategy
- Supplier Selection and Fair Value Determination
- Risk Analysis and IT Contracting
- Contract implementation and IT vendor management
Results after introducing IT Category Management
Introducing IT category management transforms supplier cooperation from fragmented purchasing to a strategic, cost-effective approach. Duplicate buying disappears, contracts are assessed for risks, and economies of scale deliver lower prices. At the same time, you gain clear insight into costs per subcategory and a more focused, fit-for-purpose IT portfolio.
Category management also strengthens customer focus. By aligning your IT offering with the needs of both external customers and internal users, you improve service relevance and increase end-user satisfaction.
Internally, your organisation benefits from greater control and transparency: you see exactly where budget, time and resources go, and you steer more effectively. Supplier relationships shift from ad-hoc transactions to long-term partnerships that actively support your digital innovation.
Finally, category management improves consistency and quality. Central governance ensures a more uniform IT offering and better interaction between suppliers, supported by approaches such as SIAM (Supplier Integration and Management), to strengthen collaboration across your IT ecosystem.
Conclusion
IT category management reduces costs, boosts performance, builds agility, and is helping your organisation to stay competitive, adapt faster, and take a strategic, future-ready approach to IT and Procurement.
succes story
Do you want to know more about IT Category Management?
Discover how Category Management makes your IT Sourcing more efficient, secure and future-proof.
