SCM Flashcards
What is Category Management?
process of governing and managing categories of goods, works, and services.
What is the objective of Category Management?
define the sourcing and category strategy to guide procurement activities in the business.
What is the Kraljic matrix?
used as a first-level lens to categorize procurement items sourced by the organization.
How does the Kraljic matrix categorize items?
based on their impact on the business and supply risk.
What are bottleneck items?
have a low profit impact but high supply risk.
What are routine items?
low risk and low impact on organizational profitability.
What is category portfolio management?
the process of managing a group of categories as a portfolio.
What is category segmentation?
process of dividing categories into smaller groups based on common characteristics.
What is business alignment?
the process of aligning procurement activities with the overall business strategy.
What is a category strategy?
a plan for how to manage a specific category of goods, works, or services.
What is local content
the percentage of goods, works, or services that are sourced locally.
What is the purpose of periodic review of procurement categories?
to ensure that they are aligned with business needs and supply risk profiles.
What is the advantage of using the Kraljic matrix?
it provides a simple and effective way to categorize procurement items.
What is the disadvantage of using the Kraljic matrix?
it may oversimplify the complexity of procurement categories.
What are the characteristics of bottleneck items?
- low profit impact
- high supply risk.
