The Value of Data-driven Category Management: A Case for Teaching Data Analytics to Purchasing and Supply Management Students

Abstract:As companies look to differentiate themselves with the help of their suppliers, the need for robust and sophisticated purchasing and supply management (PSM) processes that allow for informed decision-making becomes increasingly important. These processes often rely on sophisticated data analytics to inform the design of a company's category management strategy, such as its supply network design, its supplier relationship management, and its supplier performance management. Therefore, data analytics skills are crucial for PSM professionals. To foster these skills, we developed an innovative approach for teaching students how to use data analytics tools and techniques in PSM through the use of a teaching case called "Savingtools." This case, developed in collaboration with a company undergoing a PSM transformation, illustrates the value of data-driven category management in PSM. The case further demonstrates the principles and tools related to PSM data management, spend analysis, and classification, and allows for in-depth data analysis, including visualizations. Our approach has been shown to effectively enhance student learning and comprehension, and we believe that it prepares future supply chain leaders while advancing PSM pedagogy.