Configuring Value Levers

Objective

After completing this lesson, you will be able to set up and manage value lever groups including activating, inactivating, deleting and defining confidence-level ratings for strategic sourcing.

Configuring Value Levers

Value levers help the category manager find ways for an organization to influence its key value drivers, such as boosting sales, cutting costs, improving efficiency, strengthening supplier relationships, and reducing risks. These actions ultimately increase the company’s value in both the short term and the long term.

Category management administrators can create value lever groups and develop specific value levers that category managers can link to their categories. For each value lever, you can also assign a confidence level rating on a five-point scale for segment recommendations—Strategic, Bottleneck, Leverage, and Routine.

The ratings you set are used to generate value lever suggestions when lead category managers connect these categories with value levers. You can assign either the same or different confidence-level recommendations for the category segments. The system generates value lever recommendations based on the confidence level you specify and the segmentation of the selected category.

Confidence-level ValuesPercent Match Between the Value Lever and Category
ExcellentIndicates a more than 80% match between the value lever and the category.
Very GoodIndicates a match of 60 to 80% between the value lever and the category.
GoodIndicates a match of 40 to 60% between the value lever and the category.
FairIndicates a match of 20 to 40% between the value lever and the category.
PoorIndicates a less than 20% match between the value lever and the category.

To configure Value Lever Groups:

  1. Choose the Manage Configurations tile.
  2. Choose Value Lever Groups from the Strategy and Plan tab drop-down.Image of the Value Lever Groups selection.
  3. Choose Create and enter the name of the value lever group in the Name field.
  4. Use the drop-down to select a confidence-level rating.
  5. Choose Save.Image of steps 4 and 5.

You can search for a specific value lever group using the Search bar, edit a value lever group with the Edit button, and delete a value lever group by clicking the Delete icon available for each group in the table. You can also sort and filter the list of value lever groups.

To delete a value lever group, find the group you want to remove and click the Delete icon that appears for that specific group. This will delete all associated value levers.

To associate a value lever with a group:

  1. Choose the value lever group.
  2. Choose Create to add a value lever in the right panel.
  3. Enter a meaningful name for the value lever.
  4. Choose Save.Image of steps 3 and 4.

To delete a value lever associated with the value lever group:

  1. Choose the value lever group that you wish to delete.
  2. Select the Delete icon from the Value Levers panel located on the right side. When you remove a value lever group, all related value levers are also removed. Image of the delete icon.

Category management administrators can activate or deactivate value lever groups and value levers for use in the SAP Category Management solution.

To inactivate a value lever group:

  1. Choose the Manage Configurations tile.
  2. Choose the Value Lever Groups from the Strategy and Plan tab drop-down.
  3. To inactivate a group, choose Edit in the Value Lever Group panel.
  4. Select Inactivate for the desired group.Image of the activate and inactivate options.

Note

To reactivate a value lever group or value lever, locate the inactive group or value lever and choose Activate.

Summary

To effectively manage categories and improve key value drivers like sales and efficiency, category managers use value levers. Category management administrators can create and assign these value levers, along with confidence-level ratings, to categories to generate recommendations. Confidence levels indicate how well a value lever matches a category, ranging from ‘Excellent’ with more than 80% match to ‘Poor’ with less than 20% match. These recommendations help category managers strategically enhance company value.