Office of Small and Disadvantaged Business Utilization (OSDBU) Linda Alexander-Giles Laura J. Stanton Mark Day May 21, 2015 HHS Acquisition: Ready. Resourceful. Responsive. Category Management

U.S. Department of Health and Human Services Category Management/formerly Strategic Sourcing Buying Smarter Acquisition Gateways or “Hallways” Demo Questions and Answers AGENDA

U.S. Department of Health and Human Services What is Category Management ? o Federal Rebranding “Strategic Sourcing” to “Category Management (CM)” o Emphasis Managing Categories of Spend - Federal Buying as a Single Enterprise o Increase Efficiency and Effectiveness, Savings, Reduce Duplications o Use Existing Strategic Sourcing Initiative - Federal and HHS Contract Vehicles Available o Support Small Businesses goals and participation 3

U.S. Department of Health and Human Services Strategic Sourcing vs Category Management 4 Strategic SourcingCategory Management Goal Achieve savings: implement specific strategies around spend and vendor consolidation, standardization of requirements and specifications, and price benchmarking and negotiation Small business: Meet or exceed small business goals Maximize value for spend: reduce total cost of ownership (TCO), generate supply chain-wide savings, reduce risks, improve supplier and operational performance, and boost innovation Small business: Meet or exceed small business goals Frequency Project driven: initiated once in three to five years based on internal demand or supply market changes Continuous: ongoing series of projects identified and prioritized based on regular analysis and reporting Methodology Standard methodology: typically based on a seven- to nine-step methodology starting with assessment and ending with vendor selection and implementation Broad framework: ongoing cycle of establishing baseline and goals, developing a strategy for category improvement, project execution, and performance management Value Sourcing savings: annual savings through planned demand reduction and average purchase price reduction, tracked through finance and sourcing systems Value for spend: achievement of strategic objectives, including spend under management, price savings, TCO savings, improved supplier performance, innovation, and user satisfaction

U.S. Department of Health and Human Services Principles of Category Management o Optimizing existing contract vehicles (including replacement or elimination of duplicate or underperforming contracts) & driving more optimal use of contract vehicles o Improving data collection efforts and analysis to drive improvements in categories of spend to increase savings and reduce duplication o Leveraging industry/commercial intelligence and key partner relationships o Maximizing customer insights and relationships to bring more spend under management and improve offerings and value o Growing and sharing expertise 5

U.S. Department of Health and Human Services Buying Smarter Drive Innovations - Prioritize Efforts for Buying Smarter Maximize Contracting with Small Businesses Strategic Sourcing/Category Management/Acquisition Gateways –Strategic Sourcing – Leveraging Volume Buying –Category Management Managing commonly purchased areas of spend Collectively developing heightened levels of expertise and sharing best practices Providing acquisition, supply and demand management solutions. –What are Acquisition Gateways Evaluate/Report/Utilize Past Performance Information Increase Transparency of Contractor Business Integrity Data (e.g., Federal Government does business with reputable firm) (FAPIIS) Improve Vendor Relationships 6

U.S. Department of Health and Human Services Category Management Contact Linda Alexander-Giles ASFR/OGAPA Category Management Program Manager (202)

U.S. Department of Health and Human Services 200 Independence Avenue, SW. Washington, DC QUESTIONS 8