Lean-Agile Procurement
From Supplier, Sales Point of View
Why Lean-Agile Procurement
Volatile, uncertain and often unpredictable Market conditions demanded unprecedented levels of adaptability within and between organizations. Lean-Agile Procurement (LAP) provides it and is the first Approach, that combines Agile Values & Principles to take strategic Sourcing to a new Level.
LAP seeks to overcome the following key challenges in strategic sourcing:
Misalignment / misunderstanding (internally and externally) due to focus on paperwork and documentation
Transactional nature of Rfx including hand-offs between departments where often different people are responsible for sourcing than those for delivery
Complexity/unknowns where requirements are more hypothetical, and often change. Subject matter experts need to be involved as procurement can't make the assumption to know of the details up front and understand it all anymore, e.g. on issues like ESG, AI
Long lead times, which in turn lead to expensive and time consuming change requests in delivery, because the world has changed in the interim.
Value Proposition
of LAP
For complex project requests, that can't be offered easily, Lean-Agile Procurement offers a collaborative approach to sell and deliver better outcomes faster
The Canvas a
1-Page Proposal
Proposing for a tender documentation of a Strategic Sourcing Case takes too long to write, are seldom really aligned with the customer, and often lead to missunderstandings. A lose-lose situation!
When you're going really fast and under conditions of extreme uncertainty, you need dynamic models, not static plans.
The Lean Procurement Canvas replaces long and boring proposal and tender documentations with a 1-page, that takes 60 minutes to create and gets respond.
Sales is a Business Driver!
Commercial roles such as procurement / sales / etc. are responsible for up to ..
.. 80% of turnover in the private sector, and up to ..
.. 15% of GDP in the public sector / government
This makes the importance of improving these commercial functions and the direct, positive and powerful impact they have on the business obvious. In more recent times procurement is becoming much more significant and strategic in its impact on the environment and society!
Early Involvement & Collaboration
At its core is the cross-functional Agile delivery team, that's also responsible for sourcing. The business owner is always leading the team and sales, as well as the vendors delivery team members are involved from the start. In our experience, the mere fact of having all the skills in place improves time-to-market by 100%! - Using LAP with Scrum as the operating model for the joint delivery team has shown to improve time-to-market by up to 800% for strategic business cases!
Combined with an Outcome-based Contract, that is based on Agile Vallues & Principles, and supports Agile Collaboration, Coping Uncertainty and minimizing Risks via short Feedback-/Delivery cycles and collaboration while delivery are promises of LAP.
Criteria for success in need of your support
Before acceptance of invitation to a joint co-creation workshop the supplier checks the guardrails like requested budget, solution, timing with it's capabilities, availability, etc.
Requested supplier ask all question to clarify the approach and concerns e.g. about protection of his IP's, etc.
Requested supplier shows up to a joint co-creation workshop (often called Big Room Workshop) with core-team members of the potential delivery team, decision takers, lawyer, sales, etc. so that he's able to co-create a proposal on the spot.
Supplier respects given working agreements and e.g. request for honesty, tranparent, etc. to build trust in any manner such as e.g. improving a draft of a contract, or be open about buffer/margines, risks / concerns, etc.
Team members of Supplier should be available >2days a week too
Realistically forecasted budget adds positively to business/procurement satisfaction
Challenging the buyer-side as well as other suppliers in a constructive way is very welcome to improve the solution design, approach, etc.
Typical Results reported by Organizations using LAP
100-800%
Improved Time-to-Market
50%
80%
of usual Effort
Risk Reduction
9/10
Recommendation Rate
Benefits with LAP
Up to 10X improved lead time from request to answer / award via Cross-Company Collaboration via a workshop
1 hour effort for the first 1-page proposal
Freedom how to solve an expected outcome within agreed 'guardrails'
Coping Uncertainty and minimizing Risks via early involvement of delivery team even during Sourcing
A contract on the same eye-level, that supports agile ways of working in delivery
No Penalties, Change Management for small changes and other unnecessary overhead
9 out of 10 Satisfaction Rate between supplier & buyer