SM5005 Chap.10 Mapping Spend to MRIO Sectors
Mapping Spend to MRIO Sectors
Mapping is a modelling decision
A spend description has to be connected to the sector classification used by the MRIO factors. Exact wording rarely guarantees an exact economic match. The analyst uses product description, supplier activity, procurement category and context to choose a sector.
That choice determines the multiplier and therefore belongs in the auditable model, not in an undocumented lookup formula.
Build a concordance with reasons
The crosswalk should retain the original and cleaned descriptions, selected sector code and label, rationale, confidence, method and reviewer. Rules may match known categories automatically, while material ambiguous records go to manual review.
Version the concordance so that a revised classification can be traced and the estimate reproduced.
Split when the evidence supports a split
Some purchases combine goods and services or cover suppliers active in several sectors. A split is defensible when contract, quantity or category evidence supports the proportions. Equal splitting merely to avoid a decision creates false neutrality.
If a split cannot be supported, choose a documented proxy and test plausible alternative sectors for material records.
Validate after aggregation
Check that mapped spend reconciles to the cleaned total, that every record is assigned or explicitly unresolved, and that sector totals make operational sense.
Review the sectors driving the footprint as well as those driving expenditure, because a smaller category with a high multiplier may be material. Sensitivity analysis should focus on ambiguous mappings capable of changing those rankings.
What this chapter covers
- 01
Descriptions to model classifications
- 02
Concordance fields and versioning
- 03
Rule-based and manual mapping
- 04
Evidence-based split allocations
- 05
Mapped-spend reconciliation
- 06
Hotspot and sensitivity review
Worked example · free
Resolving an ambiguous procurement line
- 2Preserve and enrich the source evidence.
- 2Identify plausible sector choices.
- 2Choose or split with a documented rationale.
- 2Test the material alternative.
Key terms
- Sector Concordance
- A documented crosswalk from source categories or records to model sectors.
- Mapping Confidence
- A recorded judgement about the strength of evidence for a sector assignment.
- Proxy Sector
- A model sector used when the exact purchased activity is not represented or identifiable.
- Split Allocation
- Assignment of one purchase across several sectors using supported proportions.
- Hotspot Review
- Inspection of categories that dominate expenditure or the resulting footprint.
Mapping Spend to MRIO Sectors FAQ
Should mapping use the supplier or the purchased item?
Use the activity represented by the purchase. Supplier information can clarify that activity, but a diversified supplier's industry code may not describe the specific product or service bought. Preserve both sources of evidence and explain which controlled the assignment.
When is automated mapping acceptable?
It is useful for repeated, well-defined categories with reviewed rules. Validate a sample, monitor unmatched and low-confidence records, and route material exceptions to manual review. Automation should make decisions reproducible, not make them invisible.
How do you test mapping uncertainty?
Identify material low-confidence records, choose plausible alternative sectors and recalculate. Compare both the total and category ranking. Report the alternatives when they could change the decision; immaterial differences can remain in the audit trail without dominating the narrative.
Assessment move
Create a small concordance from ten deliberately ambiguous lines. Require the original description, supplier evidence, chosen sector, rationale, method, reviewer and confidence rating for each. Distinguish a product purchase from repair, rental and a bundled service even when the same keyword appears.
Write a rule that can map repeated clear categories automatically, then test it on exceptions rather than assuming scale creates accuracy. For a composite purchase, split only when contract or quantity evidence supports proportions; otherwise keep one documented proxy and a credible alternative. Reconcile mapped, unresolved and excluded spend to the cleaned control total.
Rank both expenditure and footprint contributions, because a small category with a high factor can matter more than a large low-intensity category. Select the top material low-confidence line and rerun it under its strongest evidence-based alternative. Report whether the total or action ranking changes.
Version the concordance and preserve sector identifiers so a later model release can be joined deliberately rather than by row position. Finish by naming the specific procurement detail that would resolve each decision-relevant uncertainty. Ask a second reviewer to classify the same high-value ambiguous lines without seeing your choices, then compare both the codes and rationales.
Agreement based on independent evidence is more informative than agreement created by copying an existing concordance. Resolve disagreements by returning to transaction evidence, not by averaging sector codes or confidence labels.
