Stage 5

Implementation

Overview and benefits of this stage

The fifth and final stage of the category management process is all about the execution of the category strategy that has been developed so far. In other words, it is about putting into practice all of the plans and activities that were signed off at the Stage 4 (Strategy) gateway.

In effect, this stage is mostly about managing change both internally and externally, project managing individual initiatives and ensuring that they are implemented and that the benefits are delivered and sustained.

Each of the activities that we have outlined in this section lead on to considerably larger topic areas in themselves. Project management and change management are candidates for separate handbooks in themselves and, arguably, if the category strategy has been as far-reaching in its breakthrough as we discussed during Stage 1 (Initiation), then significant investment needs to be made into making these strategies effective.

It is often the case that consultants for category management have been known to abandon their clients at this stage of the proceedings, leaving them the invidious task of putting into practice all of the ideas and strategies that looked so good on paper. Implementation and application are the hardest aspects of managing a category, whereas all of the preceding activities that lead up to developing a strategy effectively can simply involve hypothetical ‘blue-sky’ thinking and are by comparison far easier.

This stage is about actually doing the work and making the change happen. It requires robust integrated stakeholder relationships and clarity of leadership to navigate through the project plans with purpose. This is where you will find out whether you really do have full stakeholder support and supply-market leverage to implement your plans. Effectively, this is ‘proof-of-concept’ stage.

Needless to say, the success of this stage (i.e. delivery of the business requirements in terms of benefits realisation) rests fully on the rigour of the previous stages. Short-circuited research, ineffective analysis or half-cut strategy will immediately expose you and your organisation, so if there are any doubts, now is the time to revisit the category strategy to ensure you have 100% confidence in the success of the outcome!

Extra explanation and theory

There is relatively little new theory about this stage; it’s about practical application and implementation. There are six critical steps that organisations need to work through in order to put their category strategies into effect and reap the required commercial benefits, as follows and as illustrated in Figure 5.1:

Figure 5.1 The category implementation cycle

Step 1: Category strategy – This requires the development of the overarching strategy for the category of spend in scope, as defined by the category management process Stages 1 to 4 so far. This first implementation step requires clarity of strategy and good definition in terms of a well-documented and supported rationale.
Step 2: Business acceptance – Having ‘signed off’ the category strategy within the category team, its steering group or the overall category sponsor, the strategy must next gain the support and ‘buy-in’ of the stakeholder community. This is usually internal to the organisation but can equally be extended to external stakeholders, such as customers, distributors, agents, regulators, investors and other alliance partners. It should be noted that strategy ‘buy-in’ is totally different from strategy ‘sign-off’ and requires a far more sophisticated approach to stakeholder engagement and management by the whole category team.
Step 3: Action plans – Once widely accepted, the category strategy needs to be broken down into individual, bite-sized initiatives and project milestones. These tend to have a shorter time frame than the overall category strategy and take on an ‘incrementalism’ approach to strategy implementation. By keeping these action plans shorter and more focused, they help maintain momentum towards the delivery of the overall strategic goals. Shorter initiatives and milestones tend to be more achievable and therefore can introduce a degree of flexibility to the overall implementation, which is essential in the modern business environment, as well as help keep the category team motivated!
Step 4: Personal objectives – Having identified individual tasks and milestones, these action plans need to be embedded into the personal objectives of those responsible (and accountable) for delivery. This creates a sense of business ‘traction’ on the category strategy and helps to ensure there is personal commitment from a core team for the overall implementation.
Step 5: Change management – The process of implementation is now ready to start, and change management is the underlying critical success factor within this. You will look further at aspects of change management in the forthcoming activity in this section of the handbook. It is, however, a complex and multilayered subject that requires careful planning and execution to create (and sustain) a new way of working. In general, the bigger the levels of breakthrough value that you wish to have delivered, the greater the complexity and challenge of change management.
Step 6: Benefits realisation – The final step of the implementation cycle is to reap the benefits that come from the new ways of working. Again, there is a whole activity dedicated to discussion of this within this stage of the category management process. It should be remembered that benefits are far wider than just financial, and should be built around the core business requirements that you originally identified when starting out in Stage 2 (Research) of building your category strategy. You should be aware that many stakeholders within your organisation may question the validity of the benefits if they remain intangible or ill-defined. Creating an effective measurement and monitoring system to support the demonstrable realisation of business benefits is therefore fundamental to the measure of success of your category strategy!

Practical hints and tips

1 Make sure your category strategy has very clear, defined goals and objectives that are widely understood and accepted across your stakeholder community.
2 Break down the category goals into shorter and more manageable, ‘bite-sized’ chunks so that implementation is easier to control.
3 Maintain open dialogue and engagement with all of your stakeholders, clearly prioritising around those with greatest influence and interest in the area of category spend.
4 Identify the drivers and values of key stakeholders so that you can harness their support, buy-in and commitment to the changes that you want to make.
5 Most people don’t like surprises, so it’s worth keeping an open culture within your implementation team. Clandestine approaches to change management really don’t work in the modern business world.
6 Be prepared to adapt to the changing world around you (both internally and externally). This is fundamental to the success of your implementation. An agile and responsive reaction to environmental changes will help keep your strategy fresh and relevant for the business.
7 Make sure your measurement and monitoring systems for business benefits are robust and accepted by the wider business and your stakeholders.

Summary of activities

There are seven key activities outlined within this stage of the category management process. Unlike the four former stages of category management, most of these activities represent additional supporting processes:

1 Action planning – This is a simple but effective planning tool used for breaking down activities and projects into individual tasks and actions so that responsibilities and deadlines can be assigned and monitored.
2 Implementing change – The process of moving the organisation (and associated stakeholders) from the former operating model across to the new ‘target’ operating model. This process involves both behavioural and technical aspects, recognising that people and culture are just as important to address as the actual operational aspects of implementing the new strategy for the category.
3 Project management – To support the change, this introduces a fundamental set of management techniques that help implement the new operational model in a planned, timely and coordinated manner.
4 Benefits realisation – The process of identifying, recording, monitoring and reporting the tangible benefits associated with implementing the category strategy. While this is often financial, it does not always have to be. Improvements in customer retention, brand awareness, product quality and service delivery (to name but a few) are equally legitimate benefits that do not possess an automatically cashable sum.
5 Continuous improvement and review – This is the follow-up process of monitoring and enhancing the newly implemented category strategy so that the benefits gained can be built upon and improved.
6 Supplier management – Linked to the concept of continuous improvement, supplier management is the process of managing third-party vendors and service providers to ensure they continue to deliver the required levels of performance that allow the category strategy to deliver the forecasted benefits.
7 Post-Project review – The final process of reviewing the development and implementation of the category strategy as a team and with key stakeholders so that lessons can be learned, successes can be shared and future improvements can be planned for. This process also enables the steering group and sponsor to plan the next generation (iteration) of category development, so that the ongoing continuous nature of category management is preserved.

What the gateway needs to consider

There is no gateway review for the fifth and final stage of category management, but we shouldn’t assume this infers the end of the category management process. The Post-Project review activity is the last activity in the process, but as category management is iterative, it should also serve as a catalyst for scheduling the initiation of the next category management cycle in the near future and thus for commencing the next generation of strategy development.