Putting ChatGPT to the test in strategic sourcing

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It is increasingly common to hear or mention ChatGPT and how it is transforming people’s daily and work lives. Recently, in Colombia, the news went viral about the evaluation of the Superindustry regarding compliance with the protection of personal data related to this type of tools. The important thing is to convert these resources into support or verification tools to make the most of their potential, since it is an undeniable reality.

In the following experiment, an exercise is carried out to generate content similar to that of a previous blog, following some specific instructions for ChatGPT. Below are some of the instructions given to achieve the objective:

Establish the contextualization of the tool: Expertise in strategic sourcing to ChatGPT is highlighted as a starting point.
Write a step-by-step blog on how to achieve true Category Management with 1280 words. Observation: This generated a short text given the restriction of words and that it is not possible to have an understanding. Additionally, up to 6 steps were generated.
Write a step-by-step blog on how to achieve true Category Management with 5200 characters . Note: This resulted in truncated text given the character restriction. Additionally, the same texts as above were generated with 6 steps, an introduction and a conclusion.
Write a blog The step by step to achieve true Category Management with 5200 characters, with 3 stages, understanding, analysis and generation of strategies. Note: This resulted in truncated text given the character restriction. Additionally, the same texts as above were generated with 6 steps, an introduction and a conclusion.

¿Cuál es el texto generado por ChatGPT?

The step by step to achieve true Category Management	The step by step to achieve true Category Management
Category Management is a key strategy in purchasing and supply management that allows you to maximize the value and efficiency of product or service categories. To achieve true Category Management, it is necessary to follow a structured and complete process. In this blog, we will explore the three fundamental stages: understanding, analysis and strategy generation. Understanding : The first step to implementing effective Category Management is to deeply understand the category in question. This involves collecting and analyzing data about the category, both internal and external. Some key activities at this stage include: Internal information collection: Review the data and records available in your organization, such as purchasing history, contracts, supplier performance, costs and sales volumes. Identify relevant patterns and trends. Analysis of the external environment: Research the market, competition, industry trends and changing customer needs. Examines economic, political, technological and social factors that may affect the category. Identification of stakeholders: Identify all interested parties involved in the management of the category, both internal and external. This includes suppliers, internal departments, customers and other relevant actors. Understand their needs, expectations and objectives. 2: Analysis: Once you have gained a solid understanding of the category, it is time to conduct a thorough analysis to identify opportunities for improvement and develop effective strategies. Here are the main activities of this stage: Cost and performance analysis: Examines the total costs of the category, including direct and indirect costs. Analyzes the performance of suppliers in terms of quality, delivery time, innovation capacity, among other relevant factors. Risk assessment: Identify risks associated with the category, such as price volatility, availability of supplies, dependence on key suppliers, among others. Develop risk mitigation strategies. Category segmentation: Divide the category into smaller, more homogeneous segments based on criteria such as value, volume, complexity, or strategic importance. This will allow for more efficient and personalized management. 3.Generation of strategies: The last stage of Category Management focuses on developing solid strategies that optimize the value of the category. Here are some key activities: Defining objectives:Establish clear and measurable objectives for the category, aligned with the organization’s strategic objectives. These objectives may include cost reduction, quality improvement, increased innovation, among others. Development of specific strategies: Based on the analysis carried out, develop specific strategies for each segment of the category. These strategies may include negotiations with suppliers, development of strategic alliances, implementation of sustainable sourcing practices, among others. Implementation and monitoring: Once you have defined the strategies, it is essential to implement and monitor them. Establish key performance indicators (KPIs) to measure progress and conduct periodic reviews to adjust strategies as necessary. True Category Management requires a systematic and structured approach. Through the stages of understanding, analysis and strategy generation, you will be able to optimize the value of product or service categories, improve supply chain efficiency and obtain significant competitive advantages. By following this step by step, you will be on the right path to achieving effective Category Management in your organization.	Many companies have a division of categories for buyers and even carry out rotation strategies with the aim of promoting dynamism and democratization of knowledge. In this way, they do not generate dependencies in the event of partial or permanent absences. This model is very far from true Category Management, which is nothing more than the search for generating maximum value through a structured model, through differential analysis and a unique treatment of the category. Getting a purchasing team with Category Management can take years, but the benefits are surely enhanced. In the evolution curves of the purchasing process, Category Management is normally evident from a level of maturity in which, in addition to knowledge of the supplier market and the beginning of supplier development, there is an integration of the supplier in the generation of value. 3 stages for Category Management 1. Understanding This phase aims to obtain the greatest possible knowledge of the category, based on knowledge of the information available within the company as well as the environment. Both aspects can be executed in parallel, but they must have a fixed dedication in the buyer’s daily workday and records/documentation must be left that will be the basis for making decisions later. It is very important to generate a formality and treat this process as a specific project, clearly determining objective, scope, work schedule, involved with the respective roles and responsibilities; Basically, this part generates commitment for both the buyer and the managers and provides the necessary tools. Here there are very important opportunities such as the cataloging and cleaning of the masters, the search for the coding standards specific to the category, the registration of events with the chronology of occurrence internal and external, such as: list of suppliers, framework contracts, problems quality, mergers, identification of monopolies or oligopolies, participation in the local or international market, subsidiaries, alliances, among others. One of the most powerful inputs in this axis is the Spend Analysis, which is a very extensive chapter that will be left for later analysis. Additionally, it is important to build a Kraljic Matrix of Category suppliers where absolutely all of them can be mapped, without exception, depending on their complexity in management and their impact on the business. Regarding the market environment of suppliers of the category, it is important to know the trends in the sector, seasonality, logistical difficulties, geographical locations, consumption drivers., capacity, among others. The perfect complement in this part is Porter’s 5 Forces Analysis where we can see bargaining power, threat and rivalry. 2. Analysis After arduous work of understanding, it is very important to organize the information and be able to determine which are the key aspects for generating value. In this axis it is very important to build deliverables such as a SWOT of the category, business drivers, TCO (Total Cost Ownership) and risk matrices, with their respective action plans, controls and heat maps. On paper it is quite easy to list these activities, however, they require preparation, review, approval and version management processes. At this stage it is key to define what is achievable in the short term, in order to show results after a significant effort in terms of dedication of hours. 3. Generation of strategies In this axis and taking into account that these are sequential tasks, there is already enough information to propose real actions on the category, on the suppliers and on the actions of those involved within the company; Here strategies can be deduced such as the development of a small supplier to turn it into a strategic one, decentralize the purchase, generate productive processes within the company to replace the product, import raw materials, deliver the maquila to the supplier, carry out reverse auctions, among others. others. The possibilities here are endless, but with all the support of information from the previous exercises, it is a much simpler task and decision making becomes a matter of procedure because all the cards are exposed. The construction path is fascinating, the buyer’s involvement in this project generates commitments with the company and ultimately the value addition is superlative, let this be a motivation to start step by step to achieve true Category Management!
Generated by chatGPT https://chat.openai.com/ with the following criteria: Write a blog The step by step to achieve true Category Management with 5200 characters, with 3 stages, understanding, analysis and generation of strategies	Generated 100% by the author without any help, September 2020

The step by step to achieve true Category Management

Category Management is a key strategy in purchasing and supply management that allows you to maximize the value and efficiency of product or service categories. To achieve true Category Management, it is necessary to follow a structured and complete process. In this blog, we will explore the three fundamental stages: understanding, analysis and strategy generation.

Understanding :

The first step to implementing effective Category Management is to deeply understand the category in question. This involves collecting and analyzing data about the category, both internal and external. Some key activities at this stage include:

Internal information collection: Review the data and records available in your organization, such as purchasing history, contracts, supplier performance, costs and sales volumes. Identify relevant patterns and trends.

Analysis of the external environment: Research the market, competition, industry trends and changing customer needs. Examines economic, political, technological and social factors that may affect the category.

Identification of stakeholders: Identify all interested parties involved in the management of the category, both internal and external. This includes suppliers, internal departments, customers and other relevant actors. Understand their needs, expectations and objectives.

2: Analysis:

Once you have gained a solid understanding of the category, it is time to conduct a thorough analysis to identify opportunities for improvement and develop effective strategies. Here are the main activities of this stage:

Cost and performance analysis: Examines the total costs of the category, including direct and indirect costs. Analyzes the performance of suppliers in terms of quality, delivery time, innovation capacity, among other relevant factors.

Risk assessment: Identify risks associated with the category, such as price volatility, availability of supplies, dependence on key suppliers, among others. Develop risk mitigation strategies.

Category segmentation: Divide the category into smaller, more homogeneous segments based on criteria such as value, volume, complexity, or strategic importance. This will allow for more efficient and personalized management.

3.Generation of strategies:
The last stage of Category Management focuses on developing solid strategies that optimize the value of the category. Here are some key activities:

Defining objectives:Establish clear and measurable objectives for the category, aligned with the organization’s strategic objectives. These objectives may include cost reduction, quality improvement, increased innovation, among others.

Development of specific strategies: Based on the analysis carried out, develop specific strategies for each segment of the category. These strategies may include negotiations with suppliers, development of strategic alliances, implementation of sustainable sourcing practices, among others.

Implementation and monitoring: Once you have defined the strategies, it is essential to implement and monitor them. Establish key performance indicators (KPIs) to measure progress and conduct periodic reviews to adjust strategies as necessary.

True Category Management requires a systematic and structured approach. Through the stages of understanding, analysis and strategy generation, you will be able to optimize the value of product or service categories, improve supply chain efficiency and obtain significant competitive advantages. By following this step by step, you will be on the right path to achieving effective Category Management in your organization.

Many companies have a division of categories for buyers and even carry out rotation strategies with the aim of promoting dynamism and democratization of knowledge. In this way, they do not generate dependencies in the event of partial or permanent absences.
This model is very far from true Category Management,  which is nothing more than the search for generating maximum value through a structured model, through differential analysis and a unique treatment of the category.

Getting a purchasing team with Category Management can take years, but the benefits are surely enhanced. In the evolution curves of the purchasing process, Category Management is normally evident from a level of maturity in which, in addition to knowledge of the supplier market and the beginning of supplier development, there is an integration of the supplier in the generation of value.

3 stages for Category Management

1.
Understanding

This phase aims to obtain the greatest possible knowledge of the category, based on knowledge of the information available within the company as well as the environment. Both aspects can be executed in parallel, but they must have a fixed dedication in the buyer’s daily workday and records/documentation must be left that will be the basis for making decisions later.

It is very important to generate a formality and treat this process as a specific project, clearly determining objective, scope, work schedule, involved with the respective roles and responsibilities; Basically, this part generates commitment for both the buyer and the managers and provides the necessary tools.

Here there are very important opportunities such as
the cataloging and cleaning of the masters,  the search for the coding standards specific to the category, the registration of events with the chronology of occurrence internal and external, such as: list of suppliers, framework contracts, problems quality, mergers, identification of monopolies or oligopolies, participation in the local or international market, subsidiaries, alliances, among others.

One of the most powerful inputs in this axis is the
Spend Analysis,  which is a very extensive chapter that will be left for later analysis. Additionally, it is important to build a Kraljic Matrix of Category suppliers where absolutely all of them can be mapped, without exception, depending on their complexity in management and their impact on the business.

Regarding the market environment of suppliers of the category, it is important to
know the trends in the sector, seasonality, logistical difficulties, geographical locations, consumption drivers., capacity, among others. The perfect complement in this part is Porter’s 5 Forces Analysis where we can see bargaining power, threat and rivalry.

2. Analysis

After arduous work of understanding, it is very important to organize the information and be able to determine which are the key aspects for generating value. In this axis it is very important to build deliverables such as a SWOT of the category, business drivers, TCO (Total Cost Ownership) and risk matrices, with their respective action plans, controls and heat maps. On paper it is quite easy to list these activities, however, they require preparation, review, approval and version management processes. At this stage it is key to define what is achievable in the short term, in order to show results after a significant effort in terms of dedication of hours.

3. Generation of strategies

In this axis and taking into account that these are sequential tasks, there is already enough information to propose real actions on the category, on the suppliers and on the actions of those involved within the company; Here strategies can be deduced such as the development of a small supplier to turn it into a strategic one, decentralize the purchase, generate productive processes within the company to replace the product, import raw materials, deliver the maquila to the supplier, carry out reverse auctions, among others. others. The possibilities here are endless, but with all the support of information from the previous exercises, it is a much simpler task and decision making becomes a matter of procedure because all the cards are exposed.

The construction path is fascinating, the buyer’s involvement in this project generates commitments with the company and ultimately the value addition is superlative, let this be a motivation to start step by step to achieve true Category Management!

Generated by chatGPT
https://chat.openai.com/ with the following criteria: Write a blog The step by step to achieve true Category Management with 5200 characters, with 3 stages, understanding, analysis and generation of strategies

Generated 100% by the author without any help, September 2020