Activity 26
Category plan

Overview

The category plan summarises the strategy developed by the category team and projects how the category is likely to be managed across the next three- to five-year planning horizon. As such, it is a ‘live’ document that needs to be updated (and version controlled) with developments as they occur within the category.

It is considered best practice to share the category plan with key stakeholders and invite continual input and feedback, so that it becomes a living document that is reviewed and updated as needed. In organisations where category management is well established, there may be a central repository of category plans that are accessible by all those impacted so they may make contributions from time to time. However, all changes and amendments to the plan should be carefully controlled and monitored.

Category managers may be periodically called upon to present their plans to their leadership team and stakeholders, inviting questioning and scrutiny. It is thought that this process tests ideas and robustness, and ultimately should enhance the viability of the strategy document.

Elements

The category plan may be used as a communication tool across the organisation; therefore it will need to be professionally presented and easy to read and follow. Typically the contents might have a structure as follows:

Executive summary – A consolidation of all salient facts contained within the plan. It should be an ‘at-a-glance’ briefing so that the reader can quickly pick up on key aspects of the strategy and review progress within the category.
Category overview – The type of goods/services under review, how the category is segmented, its geographical scope and top-line expenditure. This could be an abridged version of the category profile (Activity 9).
Key stakeholders – This lists the key personnel involved within the category and the potential impact of the strategy on their activities.
Analysis – A summary of the key findings extracted from the analysis section of the category management process (e.g. SWOT, STEEPLE, etc.). Supporting detail should be contained within the schedules/annex section.
Category strategy – This is a high-level view of the selected strategy or strategies, such as a renegotiate, outsource or find dual supply.
Project Plan – Key milestone activities and dates, together with resource requirements. This could also include risk and dependency flags. The detailed plan is often presented in Gantt chart format and any associated reporting documentation should be contained within the schedules/annex section.
Benefits – This lists the main benefits to be gleaned from implementing the category, together with time frames for realisation.
Implementation – This is the date for delivery/handover to a ‘business-as-usual’ operational environment, and so it may include a transition plan.

So what?

In addition to acting as a strategic planning or approval document, the category plan is widely used by category teams to showcase their work. If central repositories exist (e.g. an organisation’s intranet), then access will be enabled for all those that maybe interested or want to contribute to the category management process.

It is useful source of consolidated information and allows the reader to gauge how a strategy may be evolving over time. It also helps the author of the document to embrace a structured approach to planning, with the added benefit of providing an audit trail of activity.

The category plan is also a great selling tool, as it evidences to others within the business the professionalism and hard work of those involved with a category management project, while providing a sense of rigour and strategic thinking behind the process.

Category management application

Provides a consolidated overview of the category strategy
Enables key stakeholders to view and contribute to the strategy
Acts as a promotional tool for the function
Is a point of continuity in the event of change in team membership
Provides an audit trail for the project

Limitations

It is common that some form of category plan be developed by those managing the category management process; however, the size and depth of the plan will vary enormously from organisation to organisation. Some favour a very short ‘one-pager’, whereas others prefer as much detail as possible, which can literally run into ‘hundreds of pages’. Consultants often suggest a more comprehensive version, regardless of category size; however, this can be off-putting and potentially time wasting when there is only a small value at stake.

There is also the issue of category plan presentations, which are classically held in front of a function’s leadership team. These can be traumatic events for some category team members, when panel participants become too critical or opinionated rather than being constructive and helping the team to improve. From a governance perspective, these should be limited to ‘decision panels’.

In short, category planning can become a prolonged industry in itself and, without active management, risks distracting from the actual job of operational execution and delivery.

Template

The following template can be used to develop the category plan:

Template 26: Category plan