Sunday 23rd Oct 2016 - Logistics Manager

Public sector must adopt category management for purchasing

Public sector organisations must embrace a modern category management approach to their procurement if they are to achieve the cuts in the public spending review, according to Jonathan O’Brien, director of  procurement specialist Positive Purchasing.

The pressure to make savings quickly throughout the public sector has never been greater, he argues in an article entitled “In the public good”. 

While O’Brien reckons Sir Philip Green’s recent efficiency review is the best attempt so far to highlight inefficient public sector procurement across a range of goods and service  he says the big question will be whether the massive savings identified in the report can be achieved.

Under category management third-party spend is segmented into discreet categories according to their market-facing nature. It means full data on bought-in goods and services must be collated and analysed, supplier markets properly researched and contracts negotiated for items aggregated across disparate parts of the organisation or, in the case of the public sector, potentially across several very different organisations.

O’Brien, author of the book “Category management in purchasing”, says: “The mandate for such radical action is established. The government and senior management throughout the public sector are by now well aware of the need to modernise and streamline procurement strategy. The key to success is for public sector organisations to take a different view of what excellent procurement means in practice.”