For When Speed is of the Essence: Project Procurement With Agile

Introduction

Procurement. It's a fancy word, with a very simple meaning. Project procurement management is all about obtaining things. Resources, in Project Management terminology. Project procurement management differs from project resource management in that it's about managing what you intend to get, rather than allocating what you already have. Acquiring new resources is absolutely critical to any business, and by extent, any project. Resources, from a business perspective, are just about anything, after all- labor, equipment, raw materials. They all have to come from somewhere, and that's where procurement management gets involved. Let's take a look at it in more detail.

Procurement Management in a Nutshell

Procurement management is a critical part of any business's project management plan. Any project's success depends on it's ability to source the resources it needs in a timely fashion, and make sure they're good enough to fit the bill. Procurement management involves many separate tasks, depending on the nature of the business utilizing it and the project its meant to be used with, but often includes the following:

• Determine the criteria for selecting suppliers

• Handle contracts and documentation for orders and requisitions

• Outline constraints and trends in supply and demand

• Include a cost-benefit analysis

• Identify stakeholders and the criteria to satisfy them

Procurement can be a daunting process. Paperwork aside, managers have to handle risk, seek out vendors, make deals, manage commitments, and more.

Procurement with Agile

So now that we have a general idea of what procurement management actually is, we can start talking about the methodologies used with it to help get the job done. This is where Agile comes in. As you probably know by now, Agile's not restrained to procurement management, or even the field of Information Technology, where it came from. Just like it has in many other areas, Agile can be a huge help in procurement management, particularly when contrasted with traditional methodologies.

Why Agile?

Why pick Agile methodologies in the first place? Well, there's a high chance your project already uses Agile methodologies in the first place. It's growing more and more popular, even expanding outside of its original use in software. But also, Agile's nature make it very well suited for many parts of project management, especially procurement. This is because by its nature, procurement management is very difficult to plan long-term. There's just no way to read the future and know what's going to be needed. The very field itself is fast-paced, and so a speedy, maneuverable methodology like Agile provides can make all the difference.

Furthermore, Agile's a team player's methodology. It focuses very much on collaboration, transparency, and openness- key concepts in procurement management. It can help improve team synergy and trust, and this trust rubs off on suppliers and vendors you interact with, ensuring better collaboration and business.

Agile vs Traditional Methodologies

Agile is a fast paced methodology, so it should be no surprise that it stays that way in procurement management too. The steps of the process are de-formalized, and many are combined or performed asynchronously. This is a huge boon to the speed of the procurement process in general, and more speed is always welcomed when sudden requirement changes need resources fast!

Additionally, Agile procurement methodologies don't have to replace traditional ones. If traditional methodologies work better in your team or project, that's ok! You can implement some Agile methodologies, or none. You can mix them or match them- they're flexible, and it's ok to pick whatever works for you.

Traditional procurement tends to be a bit stiff and rigid. Vendors are locked to projects. Contracts are confrontational or even antagonistic. Agile throws all of that out of the window, focusing instead on collaborative, reflexive, and speedy work that maximizes team and supplier relationships and rapidly responds to changing needs without throwing a wrench into the whole machine.

The Inherent Value of Agile

Agile's iterative nature holds more unseen bounties. Because work is done in iterative sprints, your team can recognize the flaws of one sprint, and with its closing retrospective, make plans to fix them in the next, encouraging innovation. Furthermore, Agile's focus on open, transparent team communication tears down a rigid and intimidating hierarchy and makes room for better understanding and communication- something that goes on to effect suppliers positively too, not just your teams.

Risk management, already something that was part of the traditional process, is incorporated into the Agile process by default. Because risks are assessed at the beginning of each sprint, and monitored throughout the process, Agile can be even more effective than traditional methodologies simply because it is able to regularly manage only the scope that immediately matters.

[Figure 1: An example of an Agile data dashboard] Landau, P. (2023b, February 10). Project Procurement Management: A Quick guide. ProjectManager. https://www.projectmanager.com/blog/project-procurement-management-quick-guide

During Agile's sprints, a lot of data is collected, be it from preliminary estimates, forecasts, or generated during the sprints themselves. But because Agile sprints iterate so frequently, this data is also up to date and reliable. This is a huge benefit to teams and managers alike, and can be used to improve processes and determine weak points. To this end, many project managers utilize software that displays this data in dashboards that update in real time.

Conclusion

Hopefully, all of that sounds pretty good to you. Furthermore, hopefully you can walk away from this post with a better idea of what Agile can do for your procurement process. Agile can help your team innovate and enhance their own processes, and bring about more open and clear communication and collaboration to the procurement process, greatly speeding the work that must be done, and ensuring high quality work throughout the whole duration of the process.

Resources

ProcurePort. (2023, January 23). Agile Procurement: What it is and how to implement. ProcurePort Blog. https://blog.procureport.com/agile-procurement-definition/

Del Vecchio, L. (2024, February 28). Agile Procurement: How to apply agile in procurement. Planergy Software. https://planergy.com/blog/agile-procurement/

Team, O., & Team, O. (2023, September 30). The Basics of Agile Procurement: A Step-by-Step Guide for success. Oboloo. https://oboloo.com/blog/the-basics-of-agile-procurement-a-step-by-step-guide-for-success/

Landau, P. (2023, February 10). Project Procurement Management: A Quick guide. ProjectManager. https://www.projectmanager.com/blog/project-procurement-management-quick-guide