Reimagining category management: from job title to strategic, data-driven business function

Modern procurement experts emphasise that successful category management hinges on disciplined design, reliable data, and people-led change, transforming it into a strategic business function rather than just a job title.

At its best, category management is less a job title and more a disciplined, data-driven way of organising procurement so categories function as miniature business units. That is the central observation in a Spend Matters interview with Robert Driessen...

, CEO of WTP Buynamics, whose platform aims to give procurement teams rapid visibility into costs and market prices. According to the Spend Matters report, Driessen says the long-standing problem has been that “Category Management was mostly a job title rather than a real process or discipline.” He argues the difference today is the routine linking of processes to data, which has made CatMan insights “far more powerful, making it possible to deploy CatMan more effectively.”

Those who implement CatMan successfully, practitioners and advisers say, focus on three interlocking imperatives: sensible category design, reliable data, and people-led change. Driessen frames the trade-offs plainly: apply CatMan too broadly across tens of thousands of products and it becomes high-level assortment management rather than deep category stewardship; split spend into too many categories and the organisation demands an impractical number of specialists. “In short: the key lies in selecting the right number of categories,” he told Spend Matters.

The need for disciplined design is echoed by leading procurement vendors and industry bodies. According to SAP, category management groups goods and services by shared characteristics such as type, value, supplier or risk, and when executed well can deliver improved insights, increased savings, reduced risk exposure and greater procurement efficiency. GEP’s guidance similarly positions CatMan as a strategic approach that aligns business objectives with supplier capabilities to optimise total cost of ownership and strengthen supplier relationships.

Technology, Driessen says, is an enabler but not a panacea. He cautions that “AI without data is nothing,” and that the foundation of improved CatMan is “reliable data.” Spend Matters records him emphasising that while there are “plenty of solutions available, but relatively few that cover the entire process,” the pragmatic answer is to combine tools that produce the most relevant outputs for a given organisation. That view mirrors advice from the Institute for Supply Management, which highlights spend analytics, automation and AI-powered insights as enablers, but stresses clear roles, precise data and disciplined communication as prerequisites for scaling CatMan.

Driessen expands on the kinds of visibility category teams need: beyond spend analytics, effective CatMan requires sightlines into suppliers, customers, logistics, marketing effectiveness, costs and revenues. WTP Buynamics seeks to answer that demand through continuous cost modelling: “cost models are continuously and automatically updated, ensuring you always have the latest prices,” he told Spend Matters, adding that his platform layers “the sustainable impact of production to the economic manufacturing cost of a product” so purchasers can weigh price against environmental impact at the category level. That approach aligns with increasing market emphasis on sustainable procurement: Tradogram and ProcureDesk note that CatMan can help organisations identify environmentally preferable alternatives and meet ESG commitments while SAP highlights improved adherence to sustainability objectives as a CatMan benefit.

Practical implementation challenges are largely organisational. Driessen places change management, training and onboarding at the centre of success: “Ultimately, it comes down to people.” Industry guidance supports that emphasis, GEP and ISM advise dedicated category teams and active stakeholder engagement to build credibility with finance, operations and legal colleagues.

Driessen also warns against inward-looking performance measures. “Don’t get blinded by your internal figures and returns. Always benchmark them against external market developments,” he told Spend Matters, arguing that without external comparison “you might think you are doing well while your competitors are performing ten times better.” WTP positions its market-benchmarking capabilities as a response to that risk.

Viewed holistically, CatMan sits at a high point in procurement architecture: when treated as a separate business unit it subsumes spend analysis, cost modelling, supplier management and sustainability goals. Industry guidance from SAP and GEP portrays the same hierarchy, category strategies should shape and be shaped by supplier capabilities, risk profiles and broader corporate objectives.

The practical takeaway for procurement leaders is straightforward. Use Category Management to concentrate decision rights and analytics at the right level of granularity; invest first in reliable, joined-up data; combine best-of-breed tools where necessary rather than seeking a single monolithic solution; and treat implementation as a people-centred change programme. As Driessen put it in the Spend Matters interview, without external benchmarking and continuous data refresh “you are doing category management in the land of the blind.”

Source: Noah Wire Services