Activity 29
Project management

Figure 5.6 Project management

Overview

Project management is the discipline applied to ensure delivery of the category strategy on time and in line with the business requirements. This could, for example, include the introduction of a new supplier, the implementation of improved contract terms or the outsourcing of an existing business process.

Arguably there are two ‘projects’ within category management: (1) the development of the category strategy (which we have encapsulated in Stages 1 to 4) and (2) the subsequent implementation of the solution and realisation of benefits. Both stages require project management skills to ensure timely delivery of the project objectives.

A key factor that distinguishes project management from any other kind of management is that it has a final deliverable and a finite timespan. Therefore, the category team member undertaking this role will need to have a broader range of skills due to the complexity of managing both people and process to the same end point.

A formal project management approach, together with an accompanying plan, is highly beneficial where there are numerous interdependent tasks and teams spread across several functions or companies, which are common occurrences when working within a category management environment.

Elements

A project management plan for delivering the category solution helps the team to steer a course towards its final destination. It is especially useful to have a comprehensive version at implementation stage, with the purpose being to:

• describe the aims of the implementation and expected benefits, including any assumptions or constraints in relation to delivery;
• outline the processes that will be used to monitor and report on the status, handling of risks, change progress and so on;
• ensure stakeholder buy-in and commitment;
• provide detail regarding time and dependency, for example, via a Gantt chart.

In its simplest form, project management for categories will include the following:

• Project aims – The reason for the project. At implementation stage, the project aims could range from ‘embedding the supplier with key stakeholders’ to ‘capturing cost savings through process improvement’.
• Project deliverables – These are the tangible items that will ensure the needs of the key sponsors/stakeholders are met and will include time estimates, such as achieving a 10% cost savings within six months.
• Project schedule – A list of individual task activities, together with how long they are estimated to take, who will complete them, any interdependencies and important milestones along the way. There are many software packages that can support this part of the plan.
• Resource requirements – This is the identification of the resources required, if necessary by name or skill set, along with their responsibilities within the team.
• Communication plan – Who needs to be kept informed about project progress and how this will be communicated. Normally there will be various reports with differing levels of detail for the multitude of stakeholders.
• Risk management – The systematic identification, monitoring and mitigating of risks. Note that it may be necessary to cross-reference this with other risk registers/logs that may be in existence.
• Quality guidelines – Assessing the level of quality required from the output. Note that the definition needs to be detailed and measurable so that achievement can be recorded and recognised.

So what?

Category management borrows many of the tools and techniques originally developed as part of the project management philosophy, mainly because of the solidity and exactitude they provide. For example, the project charter (Activity 1) and STP (Activity 13) templates create a firm foundation from which to kick off the category process.

The latter stages of a category project can sometimes be delayed, derailed or abandoned if not correctly managed, and a detailed implementation project plan will help drive results. There is an important link with ‘governance’ here, which relates back to all of the things you reviewed in Stage 1 (Initiation). If the category governance is set up correctly in the first place, then the implementation of the end solution is so much easier!

Category management application

• Provides a structured approach to managing the later stages of the category project
• Assigns roles and responsibilities for delivery of the category strategy
• Helps maintain stakeholder buy-in and commitment
• Supports the category management risk register and other essential governance
• Supports the benefits-realisation process
• Allows for project plans to be seen as ‘best practice’

Limitations

While the ability to drive projects to their ultimate conclusion is seen as an essential competency for category managers, many fail to apply project management methodology and too often confuse planning with scheduling, when in fact both are required.

Those with a procurement background can fall short when it comes to the ‘people’ element of project management, tending to focus much more on the execution of tasks rather than on utilising soft skills to encourage and motivate others to achieve their deliverables, which can lead to ‘change failure’.

Not adapting the project plan is also a common problem, with category managers sticking far too rigidly to the original timescales and eager to ‘bank’ the savings, though this may not be practicable.

Finally, one of the main reasons that project management can get overlooked is due to the crossover with governance that was addressed during Stage 1 (Initiation). This is an oversight. Project management does not duplicate category management governance; it supports and enhances it. Category teams would be well advised to overlook this essential component at their peril.

Template

The following template may be used as a project plan to support the implementation part of the category management process:

• Template 29: Project management implementation tool