The Point by Buyers Meeting Point
Book Review: Category Management in Purchasing (3rd Edition)
Just over 18 months ago I reviewed the second edition of Category Management in Purchasing by Jonathan O’Brien. (You can read my original review here). When I recently learned there was to be a third edition, I was unsure what I would be able to say in a new review that would add to my earlier observations.
I found it interesting to read O’Brien’s commentary, not only on the progression of this title, but on how he sees it fitting in with his other work. I don’t personally know of anyone who has written more substantial procurement books than O’Brien, and knowing that he sees a subset of them as being connected is an interesting idea. Category Management in Purchasing, along with SRM and Negotiation for Purchasing are seen by the author as his ‘trilogy’. Knowing that changes how I would approach any of the books in the group.
Far from this 3rd being a simple re-run of the same old information, O’Brien has added some significant sections to the book that make it relevant for a larger audience. A considerable new section is dedicated to governance via the 5 P’s of people, proficiency, promote, payoff, and programme. Part of how the governance model plays out organizationally is through a steering committee that reports to the C-suite and facilitates all category management projects in the organization.
O’Brien also specifically addresses category management for small and medium sized enterprises, making the point that while they may not be able to achieve the same level of leverage and scalability through category management that larger companies can, there is still significant opportunity for improvement.
Like anything O’Brien has published, the case studies and visuals are key. Of particular value are the detailed competency charts for those in category management positions.
In addition to the new areas of content, the reading I have done and the discussions I have participated in over the last 18 months called sections to my attention that I passed over the last time I read the book.
Category Management in the Public Sector
Public sector procurement organizations have to balance the need for fairness and transparency with the desire to engage suppliers earlier in the process, such as in advance of issuing a bid. Whenever collaboration is seen as a possibility, organizations must expect it to bring some change, and the public sector’s deliberately slow change process stymies the potential of such opportunities.
The Future of Procurement, Purchasing and Category Management
I found it particularly interesting that there are two looks into the future. One is focused on broad trends in energy, geopolitics, the environment, economic trends, etc. The other digs into the trends of greatest concern for procurement. This section of the book, placed near the end, is worth the purchase all on its own.
AND is the key word when it comes to procurement’s future challenges. No longer are we striving for cost and quality (although O’Brien does predict the re-emergence of Quality Assurance as a high priority function). Now a product, service, or solution has to meet cost and quality and sustainability and risk and diversity requirements. There are more constraints and more objectives and more at stake – all with the potential for more upside. We need suppliers who are agile and flexible if we hope to become either ourselves – and of course all of this needs to be facilitated by the right commercial framework.
Dare we now wait for the 4th Edition?