Episode 10: Technology procurement category planning
- Embedded IT
- Oct 14, 2024
- 4 min read
Updated: Jan 16
How to approach technology procurement category planning
If you’re new to Embedded Insights, it’s worth starting with what technology is before revisiting procurement and delivery models.
Technology procurement is often seen as a routine task centred on buying products or services. In reality, it is a strategic discipline that stretches far beyond cost and requires a deep understanding of what is being bought, why it is needed, and how it will be managed over time. When done well, procurement improves efficiency, reduces risk, and strengthens supplier relationships. When rushed or overlooked, it can become one of the biggest sources of waste and operational burden.
This guide breaks down the core elements of technology procurement, from gathering requirements to managing suppliers and building a long-term category strategy that helps organisations make better decisions.
Understanding what procurement really involves
Many still think of procurement as simply buying things. But effective procurement goes much further. It involves understanding what has been purchased, maintaining long-term supplier relationships, and planning future buying activity intelligently.
Technology adds another layer of complexity. Products change quickly, purchasing cycles are large and often expensive, environmental considerations must be factored in, and finding the right skills can be difficult. A strong procurement approach accounts for all of these factors rather than focusing solely on price.
The importance of planning ahead
Leaving buying decisions to the last minute is one of the most common causes of procurement failure. Without time to explore the market, ask the right questions, or understand the true requirements, organisations risk buying the wrong thing or spending far more than necessary.
Category planning helps avoid this. By looking at what exists today, what contracts are ending, and what will be needed in the future, organisations can build a three-to-five-year view of their technology requirements. This creates space for smarter decision making, better negotiations, and fewer surprises.
Gathering detailed requirements
Buying technology is rarely as simple as picking an item from a website. Most purchases involve technical, operational, commercial, and regulatory considerations. Clear, detailed requirements are essential.
These should include:
What the product or service needs to do
Where it will operate
How it will integrate with existing systems
Any compliance or regulatory needs
Performance expectations
Operational constraints
Environmental considerations
If requirements are unclear, suppliers will fill the gaps themselves, leading to misalignment, wasted time, or solutions that simply do not work. Writing requirements down in depth before any supplier conversation is one of the most important steps in the process.
Researching suppliers before engaging
Once requirements are defined, research becomes critical. Before speaking to a supplier, organisations should understand:
Their financial stability
Relevant certifications or accreditations
Case studies and industry experience
Market reputation
Fit for purpose against requirements
Approaching suppliers too early creates unnecessary sales pressure and wastes time. A well-researched shortlist ensures conversations are focused and productive.
Managing the supplier engagement process
Engaging suppliers becomes straightforward when the groundwork has been done. Clear requirements lead to clearer proposals, more accurate pricing, and better comparisons between suppliers.
Negotiation can then focus on value rather than ambiguity. This includes cost, performance, service levels, and long-term support.
Contracting with confidence
Contracts are often viewed as a necessary frustration, but they are vital in protecting an organisation from risk. Technology contracts must address:
Data privacy and GDPR considerations
Location of data storage
Operational processes and responsibilities
Hardware provenance and manufacturing considerations
Commercial risks and liabilities
A well-written contract should be something that can sit silently in a drawer, but when needed, it must give the organisation clarity, protection, and a clear escalation framework.
The importance of supplier relationship management
Buying the product is not the end of the journey. Many procurement teams falter by failing to maintain ongoing supplier relationships.
Supplier relationship management should track:
Operational performance
Financial stability
Issues affecting other clients
Cultural and behavioural alignment
Risks emerging over time
Strong relationships reduce risk, improve service, and ensure suppliers continue to act in the organisation’s best interests. Procurement is no longer about beating suppliers down on price but about building partnerships that support long-term success.
Building an effective technology category strategy
A category strategy ties the entire procurement process together. It outlines:
Current contracts and suppliers
Spend and contract expiry dates
Supplier importance, often tiered from critical to low-impact
Market trends and emerging technologies
Risks affecting the supply chain
Long-term purchasing plans
A good strategy is not just inward-looking. It must also consider broader market factors such as cloud pricing changes, the rise of artificial intelligence, sustainability pressures, and geopolitical risks like supply chain disruption.
By understanding where technology is heading and aligning this with the organisation’s IT strategy, procurement teams can anticipate change rather than react to it.
Gathering the right data and engaging stakeholders
Two foundational elements underpin every category strategy:
1. Reliable data
Organisations must document their contracts, supplier lists, spend data, expiry dates, and supplier risks. Without this baseline, planning is guesswork.
2. Strong stakeholder engagement
A stakeholder map helps clarify who is influential, who is responsible for specific projects, and who must be involved. Procurement and IT strategies must align, otherwise decisions can become misaligned or redundant.
Technology procurement is far more than buying products. It requires detailed requirements, early planning, strong supplier engagement, careful contracting, and ongoing relationship management. A well-built category strategy brings all of this together, reducing risk and improving long-term value for the organisation.
If your organisation wants support with developing a technology procurement strategy or improving category planning, get in touch.
