Category Management in the Federal Government
Each fiscal year the Federal Government is challenged to accomplish strategic goals while reducing spend and operating more efficiently. As part of the drive for continuously increasing improvement, the Federal Government is moving towards utilizing Category Management, a procurement paradigm which is projected to save taxpayers in excess of $18 billion by the end of FY 2020. To support agencies in their drive towards Category Management implementation, Caladwich Consulting has developed a framework specifically regarding Category Management in the Federal Government. The link below provides informational material which lays out exactly what Category Management is, how it applies to the Federal Government, and a framework for implementation developed for agencies to follow. This information is designed to provide a foundation for new category managers while laying out some of the tools and methodologies available to more senior practitioners.
Click the image above for the Caladwich Category Management White Paper
A Successful Approach to Federal Category Management – The Caladwich Framework
Successfully implementing CM in the Federal Government requires conducting multiple initiatives and actions concurrently, while adhering to OMB guidelines and agency policy. Caladwich Consulting, in cooperation with Federal partners, has developed the Category Management Implementation (CMI) Framework, a set of streamlined, repeatable steps that Federal agencies can consistently apply when implementing CM in their organizations. The Caladwich model takes the five stage CM theoretical approach and collapses it into four practical capability areas that federal agencies can effectively implement. The CMI Framework is designed to help Federal agencies reduce costs, decrease time spent on transactional purchases, and allow them to operate in a more efficient manner.
The CMI Framework is based on a series of phased capability areas, allowing Federal agencies at any stage in the category management lifecycle to confirm they are meeting the requirements for successful implementation. The CMI Framework is an iterative approach, building on the successes of previous projects while allowing flexibility for updated guidance and lessons learned. The CMI Framework allows a Federal agency to implement and sustain category management across four capability areas:
Initial Assessment: The initial assessment identifies ideal areas for cost savings through data review, spend analysis, and category segmentation. The team also conducts project planning, stakeholder assessments, and kick-offs for follow-on phases.
Endstate: Spend Visibility, Comprehensive CM Requirements, Stakeholder Integration
Develop CMI Plan: The CMI Plan serves as a comprehensive set of guidelines covering training, communication, schedule, risk management, and objectives. This focuses on simultaneous development of outreach, training, and policy planning while ensuring that category management is not performed in isolation.
Endstate: Comprehensive action plan for all category management activities
Execution: The team will utilize the analysis and plans developed to conduct BIC contract consolidation, policy guidance, and other acquisition support activities. The team will also conduct training and outreach to the larger organization, explaining the requirements and benefits of CM for its successful adoption.
Endstate: Improved Spend Under Management, Utilize more BIC contracts, Consolidate existing contracts, Cost Savings
Manage Performance: Category Management focuses on the continuous governance and oversight of the spend categories through contract management, supplier relationship management, and performance (metrics) management. This allows organizations to identify opportunities for improvement and further savings upon each iteration of category management.
Endstate: Continuous improvement under BIC contracts, Maximized Cost Savings
Category management is simple in theory, but difficult in execution. A successful implementation requires understanding of requirements, spend, careful planning, change management to create acceptance and adoption among the Federal agency, and detailed oversight of the process. The Caladwich CMI Framework provides a roadmap to successful execution through meeting OMB guidelines, reducing spend, and improved procurement efficiency.